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Our Goals For 2021

Now that we’ve entered the first full week of 2021, it’s time to explore our goals for the coming year.  So what are our goals for 2021?

Pandemic Changes Will Have Long Term Repercussions

Let me start by saying 2021 represents a period of immense change.  There are those out there that believe things will go back to the way they were pre pandemic.  Frankly, they are wrong. 

I can’t guarantee you what future years will bring.  I have my own predictions .  But fundamentally I know regardless what is coming will not be the same as today or pre pandemic.  Even if the vaccine clears the threat of Covid, the memories and habits formed from living in the pandemic will remain.

*For those that follow us on Twitter, I still strongly believe the vaccine will not get full traction until March or April.  Distribution of pharmaceuticals is one of my specialities, so this is not a shot in the dark.  But as also noted I have no inside knowledge of either Vaccine manufacturer.    So while I expect things to stabilize this year, I’d predict that to happen in the second half.

2021, A Year of Change

Closer to home, my situation is going to experience significant change this year.  First we have the non financial.    Early in the year we have some major legal proceedings scheduled related to foster care.  These proceedings will decide where we go from here.  Nothing is a sure thing currently, and likely the process forward regardless of direction will be somewhere between months and years.  But these legal proceedings will set the tone going forward.

If you remember from previous posts foster care has a financial aspect to that future.  Depending on direction it could lead to adoption assistance from my employer, paternity leave, and tax breaks.  .   It could also lead to completely different financial situation if it does not work out.  After all the financial situation of managing 2 kids is different from 3, even with foster care stipends.

2021, Job Unhappiness

Anyway enough of the heavy stuff.  Frankly my world is changing with or without foster care.  I entered 2020 enjoying my job.  The only question in my mind was how long I’d stay put.  I’ve moved up within my company every 2 years from the last 14.  But either way I was content to stay put because I was receiving significant pay increases and enjoying what I did.

Fast forward to 2021, and I’ll be honest, I’m unhappy with what I’m doing.  While my employment has remained intact, and my income has even increased , my work world has been turned upside down.  My wife thinks some of this is the lack of travel. I went from 25% business travel to I haven’t been on a plane since March.  

I suspect it’s more then that.  The problem with “work from home” is everyone wants to prove their worth.  The result of that change is a massive number of people creating low value work to prove their usefulness.  And sadly as the man in charge I am left managing all that extra stuff rather than changing the world.  It’s left me burned out and less happy with work.

2021, Income Shifting Again!

Add to that my income shift.  Prior to 2020 I had significant golden handcuffs in the form of RSUs.   But the last 2 years my management has shifted my pay to base pay and cash bonus’.  My golden handcuffs are gone.  

A note, I do still have a bit of a golden parachute.  My contract stipulates a significant severance pay and I also receive significant vacation time due to my years of service.  I also like my coworkers and appreciate how my employer treats people.  So there are reasons to stay with my current employer.  I just know it’s time to look for a new opportunity one way or other.  Internal or external, I know my employment will change soon and the hurdles for external are much reduced.

Reduced Income Ahead!

Along those lines my income will be way down in 2021 if the status quo remains.  My base pay kept up with inflation this year, so there is no raise relief.  

My company’s stock is double what it was in 2020.  I can’t see it continuing to rise at this rate.  The value is also nearly half of the value of what it was this year.  So RSUs are not going to save us in 2021.   

That really just leaves cash bonus’ as an income driver.  Again my employer has put in place plans to reduce cash bonuses.  I have no way to predict if this will happen, or if like 2020 they will be reinstated near the end of the year.  In either case that would have to be a heck of a bonus to equal this year’s income.

Wife’s Income is Also Not Stable

My wife’s income is a little harder to predict as well.  This year was a record high.  But my wife has only one customer, and her contact at that customer is changing.  So it’s hard to predict if that business will continue at the same rate.

So let’s assume for 2020 income will decline by 20%.  I won’t count my chickens on a job change before, you know, I find the right opportunity.  Ouch!

2021 Expenses Also Down

On the expense front however I see another decline from normal.  While not as steep as 2020, many of the headwinds that keep us from spending on vacations and kids activities will remain into 2021.  Also with the new travel trailer I suspect most vacations we do take will be renting campsites.  A dang sight cheaper if you ignore the fixed cost of the trailer .  I’ll conservatively estimate expenses will decline 10% from the 2019 baseline.  

Reduced Savings Ahead!

Combined I’m expecting savings to equal about 1.5 years of expenses rather than the normal 2x.  Note this prediction also assumes that nothing fully settles for Foster Care in 2021.  Any change could seriously blow up our predictions.

Reduced Return Ahead!

Return is another place where my metrics are going to suffer.  If you recall I routinely measure our safer income return with the goal to maximize our yield.  Well last year those yields were already declining.  I took action at the start of the pandemic to lock in CDs before the fall.  And I also dumped some funds into I-bonds.  So I kept about a 2% return in 2020.  

I don’t expect to do that well in 2021.  I still plan to buy I-Bonds, but that return will be closer to 1.5% currently, and could get much worse.  Given the volatility I really don’t feel comfortable setting any sort of goal here. Just be aware I will do anything I can in this area while still keeping my safe investments “safer”. 

Real Estate Investments are Temporarily On Hold

I do plan to continue to hunt for real estate investments.  But I also feel like this investment class is a bit overheated at the moment.  For diversity I want to invest outside my home market.  But the way the housing market was in 2020, there would have been no time to do diligence from afar.  I’m not comfortable enough to just jump in without doing some deep analysis.  Which means the market has to get a little less frothy for me to weigh in.  I am hopeful sometime in mid to late 2021 this will occur. 

Donations to Hold Steady in 2021

So far this list is a poor picture of the future.  Lower goals and a whole bunch of murkiness.  Well at least there is still a lower bound to the scenario given the parachute I mentioned.  So one metric I do expect to stay stable.  I expect to continue to donate 5% of our income, and perhaps more.  I’ve already started for the year with my first cash donation to the Food Bank of Delaware .

Credit Card Hacking Reduction

Credit Card hacking is another area that I expect to be reduced.  The reality is I use most cards for travel.  So without travel there is little motivation to do a lot in this space.  I recently signed up for the Discover IT card, which doubles their cash back as achieved over the first year.  So at worse I will focus on maximizing that yield.  I still want to get the Chase Sapphire Reserve a second time and also have my eye on one of the branded American Express Platinum Cards.  But honestly I won’t be moving on these cards until air travel opens back up so I can maximize the charges and the benefit usage.

2021 Blog Goals

Which brings us to the blog.  My goal here is more of the same.  Pay the hobby bills while buying me a beer or 2.  From a posting perspective the goal is to give you a post every few weeks.   I have started to write ahead again, so I suspect this will be a doable goal.

That’s it, a year of transition for us.  So what are your 2021 Goals?

5 Comments

  1. Joe
    Joe January 4, 2021

    Good luck with everything. It sounds like 2021 will be a very busy year for you.
    I don’t have a lot of goals this year. A lot of them were carried over from last year. Mostly, just continue saving and investing. I also need to revamp my site and go see my parent in Thailand.
    I just hope things will go back to somewhat normal by summer. It’s really hard to do anything with everybody home.
    Best wishes.

    • FullTimeFinance
      FullTimeFinance January 5, 2021

      I’ve gone several years in a row with carry over goals. Things can’t stay the same forever.

      I hope things work out for the summer and your trip to Thailand. Best Wishes.

  2. TPM
    TPM January 4, 2021

    I hear you on the frothiness of real estate. I was looking for an investment properties but every property gets bid well over asking and they are all way overpriced. I decided to just pay off the mortgage instead.

    Good luck on the job hunt. I decided to not look yet, if ever, unless the Mrs. loses her job. She has a nice parachute to grab onto also.

  3. Q-FI
    Q-FI January 5, 2021

    Hey bud – well uncertainty for everyone in 2021… haha. And I see you are no exception.

    Best of luck with the fostering/adoption. I know that is a long murky road for how things play out. Plus the emotional grind of it is probably the hardest.

    Sorry to hear the job has lost some sparkle. It seemed you were enjoying your work quite a bit for a while, which in my opinion is such a big boon to happiness. That’s interesting with the RSUs shifting – was that a management decision on compensation structure? The plus, is like you said, less restrictions to leave. Although, after being at a company for a long time, it’s hard to take that first step. That was one of my big mistakes in the past, not moving on from a toxic company soon enough and demanding my fair market value.

    Good luck and I look forward to seeing how 2021 shapes up for you.

    Oh yeah, what’s the status on your trailer?

    • FullTimeFinance
      FullTimeFinance January 5, 2021

      The trailer is built except for a few pieces as they have some supply chain issues. Not a big deal as I’ve asked them to hold the trailer until March so I don’t have to pay to store while it snows.

      The RSU shift is just a factor of the way performance reviews are done at my large company. A manager, having been one at the company, gets a pool of money for pay raises, cash bonuses, and RSUs. The pay out is a zero sum game between you and your coworkers. They have to split those buckets across their reports.

      2 Years ago I took this new job and was vastly underpaid in terms of the company’s own metrics on target base pay. So I got most of the raise bucket and very little of the RSUs, otherwise I’d probably have had the entire allocation for the team. This year I got the cash bonus as my income began to enter a more reasonable level for my job and the company reduced the RSU allocation for 2020.

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