Happy New Year!
It’s official, 2012 is in the books and 2013 is here! In light of the new year, and to mark my first complete year with this blog. This month’s update will be a bit different. Instead of looking at how my portfolio grew or shrank compared to the prior month, lets take a look and see how I did over the entire year. After that, I’ll look back and see how I did on the goals I set for myself at the beginning of 2012, and finally, I’ll set some goals for the year ahead!
First things first, though. Let’s take a look at the numbers…
2012 Portfolio Review
Roth IRA: $17,660 (+17.61%)
Traditional/Rollover IRA: $9,205 (+23.46%)
At the beginning of 2012 I wasn’t even contributing to my IRA’s because I had just bought my house and was unsure of how my finances would really look. I started contributing a small amount each month starting in the spring and plan to significantly increase my IRA contributions for 2013. Giving that I didn’t contribute a ton of money to these balances, I’m very happy with the growth of the balances (especially given the S&P 500 returned just over 13% for the year!).
401(k): $3457 (+522.88%)
I admit…that percentage was fun to type. However it’s obviously heavily skewed by the fact that I was only a few months into my job at the start of 2012 and had basically nothing saved in my 401(k) at that point. Excluding my contributions my 401(k) returned 8.7% last year. That lags the S&P 500, but I have a bit more of a conservative mix in my 401(k) than in my IRA’s. I touched on this in a prior post, but basically I don’t view my 401(k) as a true “long-term” investment because I don’t see myself staying at my current job for an extended period of time. So I focus more on preservation until the time comes where I do leave and roll the balance over into my IRA.
Cash: $7356 (+33.75%)
Not much to say here. Just sticking to my budget and saving out of each paycheck!
$519 (Started Investment in July 2012)
I guess I should count this with my cash performance, as that’s where it started the year! So far I am invested in 20 different loans over at Lending Club (+1 from last month). As the borrowers I am invested in pay on their loan, I reinvest that money back into more loans. So the number of loans I’m invested in as well as the speed with which I can add more loans should increase over the coming year.
I’m still in the trial phase with Lending Club, but so far I have zero complaints. Each borrower has paid on time each month, and the money shows up in my account like clockwork. My net annualized return for my Lending Club investment is 9.34%. If the good experience continues (and I expect it will). I will be taking more money out of cash and putting it towards my Lending Club investment.
Total Portfolio Value: $38,197 (+33.90%)
I have to admit, I didn’t think I did that well with my investments over the past year. Seeing my investment portfolio grow by almost 34% puts a smile on my face, and gives me a high hurdle to clear in the coming year for sure!
Review of 2012 Goals
I know I got a bit lazy and stopped updating my progress on these goals each month, but I didn’t forget about them! Here’s how they turned out:
1. Get A New Bank – My bank had stripped away its rewards program on checking accounts and not long after instituted a monthly fee for checking accounts. I’m glad to say I kicked the to the curb in favor of Charles Schwab Bank who not only charge me no fees. They refund all my ATM fees and pay interest on my checking account balance! - PASS
2. Optimize My Accounts – I did change all my credit cards and my mortgage to be due on the same day, but had no luck in getting the utility companies to let me change my bill’s due date. – INCOMPLETE
3. Pay Off My Car Loan – Starting the year I had about $4000 left on my car loan, and I did pay off the full balance shortly after, and about 8 months ahead of schedule! – PASS
4. Save and Invest 10% of my Income – I was unsure how my financial picture would shake out at the beginning of the year, but as you read above, this was a big – PASS
5. Write More – I was pretty lazy and inconsistent when I started this blog so I challenged myself to write more consistently at the beginning of 2012. I’ve now settled into a nice schedule of posting twice per week the vast majority of the time (Tuesdays and Thursdays if you haven’t noticed!). I’m going to stick to this frequency going forward as I think it keeps enough fresh content out there for you readers while not sucking all the joy out of writing new posts on my end 
– PASS
6. Grow and Improve this Blog – This was admittedly vague, but since the beginning of 2012 my readership has grown by leaps and bounds. I’m now averaging more visitors per day than I would get in an entire week at this time last year! I’d like to sincerely thank each of you that actually reads all of my posts. I never imagined anyone would do such a thing, but I’m glad I’m able to provide a source of information or entertainment to at least a few people out there! – PASS
Goals for 2013
I’ll be honest, I’m usually not big on setting goals. When it comes time to set them at work I think I’d honestly rather be having a root canal. So for 2013 I’m only setting a couple of goals for myself.
1. Save 50% of my Income – This quickly became one of my most read posts ever. I have no doubt this will be incredibly hard to do, and I have no idea if I’ll be able to make it. But it’s out there, and that’s the goal I’m shooting for this year!
2. Grow and Improve this blog - I know, I know. I’m repeating this goal from last year, but I really do want to keep pushing myself and seeing what I can turn this site into! I enjoy writing about money, finance and the whole bit and it seems I don’t totally suck at it judging from how this site has grown to date. Hopefully the trend continues in 2013, and thanks again for reading!
December’s Top 5 Posts On The First Million is the Hardest
These were the top 5 posts last month, based on the number of views. If you haven’t read them yet, this is your chance!
1. Saving Half of My Income – Can It Be Done?
2. The 99 Best Personal Finance Posts of 2012
3. How To Save $700 By Switching To A Prepaid Smartphone
4. Simplify Your Life – Automate Your Finances
5. Peer to Peer (P2P) Lending Explained – Lending Club Review
I hope everyone out there had a great 2012 and hope we all have a very prosperous 2013!
Thanks for reading! If you enjoyed this post be sure to subscribe by email to have my latest posts delivered right to your inbox! No spam, I promise!
Good luck with your 2013 goals! Having only a couple is great to help you keep focus.
So is the rollover/traditional IRA actively being contributed to as well? Just curious what your percentages are in terms of where you’re saving pre-tax vs after-tax as that’s something I’m not sure we’ve optimized yet.
I didn’t actively contribute to that IRA in 2012, but I will be in 2013. My company took away it’s 401(k) match, so I think I’m going to do my pre-tax saving in the IRA because I’ll have more investment options and lower fees. I’ll be writing more about that in my next post
As for the pre-tax/after-tax split, im not so sure I have it optimized either. I saved enough for the full match in my 401(k), and then anything else I could afford to stash away for retirement last year I stuck in my Roth.
Nice job with the 401(k)
I feel like no matter what your portfolio is, a 401(k) is going to lag, because there are rarely any good choices in them. My wife’s gained 10% this year; the first year of the marriage where it didn’t actually loose value.
Yeah, 401(k) offerings are rarely optimal. I’m going to be leaning more on my IRA’s in the coming year just for the wider range of investments and lower fees compared to my 401(k).
You have alot of PASSes this year which is great! Sounds like the blog is doing well so you must be super happy. Saving 50% of your income would be interesting to do. I think we saved around 45% this year but I’ll do the numbers in the next week or so. Looking forward to 2013 and seeing how you make out! Best of luck mate! Mr.CBB
Thanks! I am very happy with how things are going, hopefully the trend only continues this year!
Lot of accomplishments this year!
50% saving is hard but the boost it will give to your networth will be very motivating. We used to save that much, but I quit my job last year. We have to see what we can do with one income this year.
Good luck with your 2013 goals!
Just saw your Alexa – well done and 100K next stop (this is why I am still working hard
)
Wow! I didn’t even notice! Under 200k!
Nice growth on the 401k man. Blew me out of the water by 2X!
Great article and nice review of goals. That remains me that I am neglecting my 401k on my own blog. I see you were investing with Lending Club. I invest with LC too and I am more than satisfied with this vehicle. I’ve been with them for about three years and have no delinquencies, and no late notes so far thanks to the way I review the notes and get rid of those which give me a warning of a potential trouble.
Correction: “reminds me…”