Goals for 2016

It is that time of the year where I need to come up with the goals for this year. The goals are really a key factor to make sure that I am making consistent progress. As I mentioned in my December 2015 goals update, even though I didn’t achieve one of my several goals, I am happy that I have made considerable progress compared to where I was at the end of 2014.

Recap of Goals for 2015

• Invest at least $35,000
  • Invested $26,969.30 in 2015
  • Failed
• Receive at least $2,500 in dividends
  • I have received $2,822.72 in 2015
  • Achieved
• Achieve at least $3,200 in projected annual dividends
  • Currently have projected annual dividends of $3,275.85 at end of December
  • Achieved
• DO NOT have a portfolio of more than 45 stocks/ETFs
  • Currently hold 44 stocks/ETFs through end of December
  • Achieved

Based on the 2015 results and projecting what I can do for this year, these are my goals for 2016.

Goals for 2016

• Invest at least $25,000
  • I did not achieve the investing goal of $35,000 in 2015 and the reasons were outlined in the goals update.
  • The goal for 2016 represents a more reasonable number that is closer to what I can do consistently. Here is how I arrived at the numbers.
  • I plan to continue my weekly Sharebuilder purchases of at least $300. So this amounts to about $15,000.
  • I will be adding about $10,000 towards 2015 IRA contributions. This includes the spousal IRA as well for my spouse. Typically I contribute to my IRA after the calendar year (during tax time) to determine whether it is worth to do a Traditional IRA or do a Roth.
  • I do not plan to invest anything in my other taxable account as of now.
  • So adding these all together gave about $25,000. If I do end up beating this goal by a huge margin, it is well and good.
• Receive at least $3,675 in dividends
  • My projected annual dividends at the end of 2015 stood at $3,275.85. Looking back to the growth from 2014 to 2015, the total dividends received in 2015 was about $600 higher than the projected dividends at the end of 2014. So by the same calculations, I am looking to receive at least $3,675 in dividends this year. This means that I have to receive close to $400 in additional dividends coming from 2016 investments and/or dividend increases.
  • This is a conservative and less than last year’s increase due to the fact that I am expecting some dividend cuts in my portfolio due to the market weakness in the oil/energy sector. I have lot of stocks in this sector (COP, PSX, BP, CVX, NOV, KMI, XOM and BBL). These 8 stocks constitute over 24% of my annual dividends even though they are only about 12% of my portfolio right now. So any dividend cuts in this sector will have a considerable dent in my total dividends.
• Achieve at least $4,000 in projected annual dividends
  • $25,000 in new investments at an average yield of 2.5% gives about $625 in new dividends. Coupled that with projected dividends of $3,275.85 at the end of 2015 and future dividend increases, I ended up with a goal of $4,000 in future projected annual dividends by the end of 2016.
  • Again, looking back at the numbers at the end of 2014 and 2015, I was able to increase my projected annual dividends by about $1,000 in 2015 from about $2,235 to $3,275. But again, due to possible dividend cuts, I am projecting only an increase of little over $700 in projected annual dividends for 2016.
• DO NOT have a portfolio of more than 45 stocks/ETFs
  • Currently hold 44 stocks/ETFs through end of 2015. Most of the increases were due to stock splits and spin-offs like that of HPQ/HPE and BAX/BXLT, BBL/SOUHY. EMR also has a spin-off planned in the near future.
  • I am also thinking of selling some of the stocks with smaller positions to consolidate them. Let’s see.
• Maintain this blog and keep it updated regularly
  • I want to have this goal for obvious reasons 🙂

The goals page will be updated soon to reflect the 2016 goals.