Now that I’ve closed the book on 2013 and managed to squeak by and hit my 2013 goals, moving forward to 2014 is important (we are in February after all). For me, goal setting is an enabler, of course in the most positive way possible. Goal setting helps feed my addiction for investment analysis and investing in general.
While I currently discuss two main types of investing here at WYOR, I love analyzing all types of investments. I have cash flow projection worksheets for real estate going from single family homes up to larger multi-unit properties, dividend projections, and peer to peer lending filter analysis. I also love looking at individual growth companies to determine revenue and earnings growth trends, future profitability, and market development. Ultimately, I’ve got a fever, and the only prescription is more cowbell more data crunching.
For 2014, I will continue to set passive income goals for my dividend and peer to peer lending income. Additionally, I am adding a blog performance goal to help me track how the blog is doing. While certainly important, it isn’t near as important as the passive income goals.
2014 Passive Income Goals
In 2013, I ended the year with $2,643.48 of passive income between my peer to peer lending and dividend income. When setting my goals for 2014 I had to take a few things into consideration while making sure I pushed myself past what was already obtainable with my current investments. This coming year will be an interesting year investment-wise as my fiancé and I bought a house at the end of 2013 and will be getting married this year. As I’m sure many of you can imagine, this alters the capital demands of my life and affects many things, including the capital I can put towards my investments, and not just those tracked on the blog.
My current projections and capital commitments defer a lot of my additional investments to the back half of the year, cutting down on some of the income growth that would have been gained by investing from the beginning of the year. All that being said, I am going to really challenge myself with aggressive goals, knowing that if I don’t hit them, I will have still vastly improved my passive income. Starting off first, let’s tackle my peer to peer lending accounts.
Lending Club Goal: In 2013, my taxable and Roth IRA Lending Club accounts earned a total of $1,503.05 of net interest, exceeding my goal of $1,480 by $23.05. Undeniably successful, I have high hopes for 2014 even given the limited capital I can commit. So, in reaching for the stars, my goal for 2014 will be an increase of $470 from 2013’s goal to $1,950 of net interest across both of my Lending Club accounts.
This represents an increase of 29.7% over my actual 2013 net interest received. What kind of returns do my Lending Club accounts need to return to achieve this goal? I am targeting a 12% internal rate of return based on current holdings and some additional capital investments. I will be updating my investment criteria later this week to show how I plan to invest any new capital plus reinvest the interest received. My published 2013 investment criteria can be found here.
Prosper Marketplace Goal: I had a fantastic start to my investment with Prosper after opening the account in May. I know that I cannot expect to continue at such a high level as late notes and defaults will certainly come down the pike. However, I am not satisfied staying put, and put together a significant increase for my 2014 goal. Representing an increase of $280 and 200.3%, my goal for 2014 will be to earn $400 of net interest from my Prosper account.
Certainly going to be a stretch and require some additional capital in order for me to have any shot of reaching this goal. I am targeting a 14% internal rate of return from my Prosper account in order to hit this goal. As with my Lending Club accounts, I plan on sharing my 2014 Prosper investment criteria later this week. You can find my 2013 Prosper investment criteria here.
Dividends Goal: Squeaking by narrowly with a $5.94 margin over my 2013 goal, this year my goal will be to receive $1,650 of dividends in 2014. Unlike my peer to peer lending accounts, where additional contributions can turn into additional net interest within a couple of months, dividends are a different story. With dividends, you must rely on the timing of quarterly ex-dividends dates and can sometimes go 4-5 months without receiving a dividend from a position. This puts me in the precarious position of stretching my income goal by increasing it by $650 over last year’s goal and requiring additional contributions in a year where things are quite in flux.
2014 Blogging Goal
While not a huge milestone, I passed my first year of blogging back on the fourth of February. I say not huge because I did take a nice four-month hiatus last summer. Since starting back up in the middle of October, I’ve seen a nice rebound in traffic and writing motivation (free time helps with that!). I know that my time will get even more limited towards the back half of the year once married and back in school (pursuing my MBA). To help encourage me to focus on regularity and consistency, posting a blog goal should foster that motivation. Public goals foster accountability and accountability fosters action.
Traffic Goal: In my first almost 11 full months of blogging, going through December, including my extended summer break, I had 7,614 unique visitors come 10,693 times and look through 19,931 pages. I wrote a total of 71 posts and covered everything from whether to DRIP or Not to DRIP to refinancing my rental to the multitude of changes behind the scenes at Lending Club. While I certainly enjoyed some success my first year, I really killed the momentum generated in my first couple months of blogging when I wasn’t posting during the summer. This was also compounded when I had some hosting issues resulting in almost no visitors during July.
My goal for 2014 is to have 20,000 unique visitors come to my site and view 100,000 pages. While some bloggers can do this in a month (looking at you Dividend Mantra), for a relative rookie like myself, this would represent a tremendous increase in traffic over 2013. Posting consistency and the ability to put out quality content will be the key to achieving this goal.
I thought long and hard about adding two additional blogging goals, but nixed them because they would not properly align incentives to actions. The other two goals I considered were a ‘number of posts’ goal and a ‘blogging income’ goal. The number of posts goal, while admirable, would have incentivized me to post just to post, without encouraging me to write quality content. Just throwing words on the screen isn’t good enough nor inspiring enough to those looking to pursue their own journeys and I didn’t want to pressure myself into doing that.
The blogging income goal is one I might consider for 2015 as it is just a bit too premature at this point. Until I can develop a higher level of consistent traffic, I am not worried about scraping for pennies. This blog should cover all its expenses and then some with the little advertising I have on the site, but that is really its only purpose at this time.
So there you have it, my four 2014 goals; three financial and one blogging. I plan on altering my monthly update posts so they read better. I should have January out prior to the end of this month once I can finalize and post my peer to peer lending criteria for both Lending Club and Prosper.
All told I am looking to earn $4,000 of passive income over the course of the year and increase my blog traffic five-fold. I have updated my goals page with my 2014 passive income and blog goals, and included a link to all my 2013 passive income updates is there should you want to go back and check out 2013.
There is a lot going on in 2014 and I couldn’t think of a better way to write my own reality. Join me on my journey to find my own slice of financial freedom. You can follow me on Twitter, Facebook, or by subscribing via email below. My RSS feed is also available by clicking the feed link at the top of my site.
Have you set goals for 2014? If so, did you make them stretch goals?
Flickr: The Happy Rower