Create Your 2020 Financial Plan

Another year nearly done. Time to plan for 2020! Today I’m providing you a 2020 Financial Plan downloadable, printable PDF. This will help you set financial goals and intent for 2020. Writing out those goals can help you stay on track through whatever 2020 brings your way, financially.

The 2020 Financial Plan PDF

Budgeting is obviously important, but it isn’t the only thing you need to do to have your finances on track. Budgets usually have a short timeframe – typically a month. You also should be looking longer term. This 2020 Financial Plan worksheet will help you plan out your financial goals, methods, and action steps for the entire year. In fact, by establishing your annual goals you may find a better plan for your monthly budget.

So click on this image of the 2020 Financial Plan and print it out. Once you are ready, we’ll walk through the form together so I can suggest some ideas for filling it out.

When you’ve finished filling out the Plan, put it somewhere you’ll see it often so you are reminded to follow it. Last year, some people put the 2019 Financial Plan on their refrigerator. Mine was on top of my desk, next to my laptop.

You can also click this link to download the form.

Now that you have the form in hand, let’s talk about how to fill it out.

Part 1: The Intent

At the top of the 2020 Financial Plan worksheet is a place for you to lay out your overall intent for your money. What do you want to do, or change? Here are some ideas:

• Tackle debt (maybe pay off 15% of your debt this year?)
• Increase savings
• Increase investment contributions
• Learn about tax strategies
• Buy a rental property
• Free up money for investments by lowering taxable income
• Learn to spend less than your income

My 2020 intent is two-fold: maintain my 2019 gains and increase my charitable giving.

2019 was a great year for more investors, as long as they were broadly diversified in stocks. The year-to-date return on SPX, an S&P 500 index, is over 28% as of December 22nd, 2019. Other index funds have performed similarly, or even better. That’s a really good year.

But it can’t last forever, and I’m feeling protective of my 2019 earnings. I’m in a very good place right now, better than I expected. So while I’m not freaking out and moving to bonds or even safer investments, I am looking at ways to diversify my investments even further. Diversity is important because it can protect you when certain sections of the economy are struggling. I don’t yet know exactly what I’m going to do to diversify, but it will likely include investing in new funds or maybe buying an investment property.

As for charitable giving, the military is receiving a huge pay increase in 2020. I make plenty for my needs, but I could donate more. During his speech prior to signing the National Defense Authorization Act on December 20th, 2019, President Trump said if you don’t need the raise, give it away. So that’s what I’m going to do. If you have charities that you love (especially military charities!) let me know in the comments. January’s donation will be going to Fisher House.

Part 2: Monthly Action Steps

The monthly action steps, then, are things you can do every month to move towards your overall annual goal. Do you want to learn to live on less? Then your action steps can be focusing on lowering your recurring expenses. Want to become really “money smart?” Maybe you can read a financial book each month to enhance your knowledge.

Here are a bunch of ideas for this section:

• Read some of the great financial books out there (check out your library’s collection and request they add any that aren’t already available!)
• Lower your monthly recurring expenses (insurance and entertainment bills, reduce energy usage, etc)
• Try a new money saving tactic each month (walk to work/stores? Cook more?)
• Complete a No Spend Month
• Create an Emergency Binder
• Make changes to your finances (redo your budget, up your investment contributions)
• Tax stuff! File your taxes, organize your receipts, etc
• Check your credit reports for free on AnnualCreditReport.com (this is the one authorized by US Federal Law!)
• Calculate how much money you need to save for college, a new car, retirement, a down payment on a home, etc

Part 3: 2020 Goals and Methods

This part is split in 3: savings, debt, and investing. For each one, write in what your goal is. Obviously if you don’t have debt you can skip over that. If you aren’t ready to invest yet because you are paying off high interest debt then you can leave that blank.

This is where you should be looking at your budget at the same time. If you decide you want to put an extra $360/month towards paying down the principal on your mortgage, then you should add an extra $360/month to the mortgage payment on your budget! And if you are going to add another $50 to savings every month, where is that money going to come from?

One thing I felt was important for the investing portion was a place for you to document your investing guidelines. The last four sentences are all about that. It’s fairly common for people to change up their investing strategy if they see their asset market having huge gains or losses. It’s important to think through your philosophy beforehand and stick with it. If you’ve planned carefully, you shouldn’t need to change. Don’t let your emotions get the best of you – that’s how people end up hurting themselves when markets start to tumble.

Part 4: Important Notes

I wanted to leave some space for you to fill in things you need to record that aren’t covered elsewhere on the form. Maybe you use this space to write out important dates. Maybe you use it to track irregular income. Perhaps it’d be a good spot to write down your charitable contributions so you can track them for tax purposes. Whatever! Use this spot in the way that works for you.

One thing you might want to add – if this applies to you – is tracking extra income. Are you adding on a side hustle? Track your earnings and how you use that money in this section.

Part 5: Your 2020 Money Philosophy

Finally, I added in a section for you to write out your money philosophy. This is where you can lay out your overall feelings on money. Use your money philosophy as a guide or motivator for thinking about how you save and spend.

I want you to create this on your own, but I know that can be difficult if you’ve never heard of a money philosophy. Heck, mine took 10 minutes to decide and I say “Money is a tool” constantly. So here are some prompts to get you started. But really – think about what you believe about money. Or choose something you want to believe about money, because maybe seeing it regularly will get you there.

• Give more, save more, live more.
• Money is a renewable resource. Time is not.
• I control my money, my money does not control me.
• I can always make more money.
• Money is not the goal, freedom is the goal

That’s the 2020 Financial Plan printable! What goals and actions steps do you plan to implement?