Year end financial review 2022 — Reviewing personal financial goals and highlighting accomplishments with dividend investing. I am not a licensed financial advisor and this post is not financial advice. All opinions are my own.
2022 was a financially challenging year for many due to inflation, high interest rates, and the worst stock market crash since the financial crisis of 2008-2009.
But personally speaking, 2022 was an amazing year, financially. In fact, it was my most accomplished year ever.
I hope this doesn’t come off as if I’m bragging, though, because I really earned it. I worked harder than I ever have in my life, and I was prepared because I put myself in position to take advantage of a financial crisis in the years prior. I sacrificed every long weekend and worked every single extra hour I was allowed to in order to save money. And I did it gratefully. I even sacrificed on my most beloved hobby — blogging. I drastically cut down on the time I spent blogging to prioritize personal finances.
Fortunately, all of my hard work and prudent financial decisions put me in position to capitalize on one of the most dismal of economic times that I’ve seen in my lifetime.
In the words of the great Warren Buffett:
“Only when the tide goes out do you discover who’s been swimming naked.” — Warren Buffett
In this post, I will review the seven personal finance goals I set for 2022 and highlight my financial accomplishments.
Let’s dive in.
Year End Financial Review 2022 — Reviewing The 7 Financial Goals I Set
Early on in January 2022, I set seven financial goals to work on.
I focussed on practical, measurable financial goals that were achievable rather than whimsically hoping for unlikely results just because of a calendar change.
Below I review the seven financial goals one by one to reveal if I accomplished them.
Year End Financial Review 2022
Financial Goal # 1 — Save 15% Minimum For Retirement And Investing (Accomplished)
I easily accomplished my goal to save at least 15% of my net income for retirement and investing. In fact, I beat that goal by more than double digits. I also surpassed last year’s 23% savings rate.
For the record, this 15% minimum does not include the money I was saving for a house. Ideally, I aim to save 35% to 50% of my net income for retirement.
Anyways, I am happy to say that I accomplished this financial goal in 2022.
Financial Goal # 2 — Earn $1,200 In Dividend Income (Accomplished)
As a progress-oriented person, I enjoy tracking the dividend income I earn from my stock holdings on a yearly basis. I find the process of seeing my dividend income slowly compound each year to be absolutely thrilling. It’s also nice because every year I have more data to build upon. I’ve been tracking my dividend income updates monthly since June 2017 now.
Based on the data I’ve accumulated from June 2017 to December 2021, I set a financial goal to earn at least $1,200 in dividend income in 2022.
Fortunately, I was easily able to surpass this goal as well. I ended up earning $1,350.22 in dividends in 2022. So I beat my target amount by $150.22. Furthermore, it was a 65% or $533.40 increase compared to the $816.82 I received in 2021.
Financial Goal # 3 — Grow Forward Dividend Income To $1,500 (Semi Pass)
I set a goal to reach $1,500 in forward annual dividend income by the end of 2022.
At the time I am writing this post, my forward annual dividend income is well below this amount. However, it’s only lower because I sold some of my positions for a down payment on a home. I actually surpassed $1,500 in forward dividend income around the midpoint of the year.
As such, I view this goal as a semi pass because I did technically hit the goal. I even toyed with the idea of using margin or a credit line to avoid selling equities. But with interest rates being higher and since I despise debt, I decided to sell stocks and pay cash to keep my financial situation cleaner.
Financial Goal # 4 — Lower Investment Fees (Semi Pass)
Perhaps I am being too easy on myself, but I am calling my goal to lower investment fees a semi pass as well.
Technically, I did significantly lower my investment fees. However, I did not lower them as much as I intended to. I actually wanted to spend zero dollars on commission and fees in 2022. But since I liquidated a TFSA, I had to pay commission to sell a few positions. In total, I spent $198.50 on investment fees in 2022.
I look forward to lowering my investment costs even further in 2023.
Financial Goal # 5 — Reopen A Margin Account (Fail)
I failed my goal to reopen a margin account in 2022. But I’m not mad about it at all.
The main reason I didn’t is again related to buying a property. But also because it makes more sense to max out my TFSA and possibly even my RRSP first.
In turn, I put this goal on the back burner. I would even open an options account before I’d open a margin account now. I actually started funding my options account in 2022 and intended to start incorporating ‘the wheel’ options strategy to generate investment income from selling out of the money covered calls. Since I am someone who is not phased by stock fluctuations, the wheel options strategy makes perfect sense to earn income from options premiums.
At this time, I do not plan on prioritizing an options or margin account though. For the time being, my goal is to max out my TFSA, RRSP, and build up a large emergency fund. Once those accounts are fully funded, a margin account will become a priority.
Financial Goal # 6 — Focus On The Best Stock Ideas (Pass)
Another one of my financial goals for 2022 was to focus on the best stock ideas.
Essentially, I wanted to hold fewer stocks that are higher quality rather than hold many for diversification.
I view this goal as a pass because I did cut down the number of stock positions I hold.
Financial Goal # 7 — Buy A Condo Or House (Pass)
My major goal for 2022 was to buy a condo or house.
I’m happy and still surprised to say that my partner and I accomplished this goal towards the end of the year. We bought our own place. And we did it completely on our own without any help, which is something I’m extremely proud of.
Ultimately, we bought to gain more price control instead of being at the mercy of a landlord. Although I have no intention of paying the mortgage off early (I’d rather invest at our interest rate), it’s nice to know that it will eventually be paid off. Instead of putting all my savings into stocks and competing with rising costs, inflation now works in my favour on the housing side of the equation.
The process of buying our own place all began in 2021 when our landlord informed us we would have to move out because they would be selling the unit. I never wanted to experience that situation again, so I bought a place to avoid it. Frankly, I was sick of moving in general. I used to enjoy the limited responsibility of renting. It was thrilling to have a new place every few years. But something changed after I moved in 2022. Instead of feeling like a thrill, renting became uncomfortable and temporary. A rental ceased to feel like a home.
Furthermore, owning a property fits in line with my quest for financial independence. I was growing tired of having a landlord to answer to. Of course, the independence of owning a property does come along with more responsibility. But it’s a responsibility that I welcome at this point in my life.
Year-End Financial Review 2022 — Final Thoughts
In summary, I basically achieved six out of seven financial goals. The only financial goal I truly failed was to open a margin account.
Otherwise, 2022 was a tremendous financial success. The two main highlights of the year were buying a property and earning $1,350.22 in dividend income.
I look forward to setting my financial goals for 2023 and building last year’s progress.
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