2013 Goals: Save 50% of Income and Live on Minimum Wage

The end of the  year is coming up soon and many people are setting goals for the new year.  I will be setting a couple of goals for 2013 as well.    My intention is to set a couple of year long goals now and make some smaller goals during the year.  That was what I intended to do this year but I didn’t follow through.  I’ll have a post on my 2012 goals before the end of the year.

As you can probably guess from the title my goals for 2013 are to save 50% of my income and live on minimum wage.  These are both financial goals and are goals that I am capable of attaining.  These goals are mostly in my control, so as long as I don’t get lazy or lose focus it should not be too difficult to achieve these goals.

The goals of saving 50% of my income will be the most difficult.  I had a negative savings rate this year.  My circumstances have improved though and I will be making more money in 2013 which will allow me to save a lot more money.  I’m currently working a part-time job and will start a full-time job next week.  The full-time job pays over twice the hourly rate of my part-time job so that will be a nice boost to my income.  I have another part-time job scheduled to start in late January.  That job has full-time hours available so I will work as many hours as I can.  Once I’m working all the jobs my monthly income should be double or triple or possibly more than my average monthly income in 2012.

Saving 50% of my income will also allow me to max out my IRA for both 2012 and 2013.  I’ve only contributed $100 to my IRA so far this year so I can put $9900 of my savings in IRAs.  I have a Roth IRA, but I’m thinking of opening a traditional IRA and putting the rest of my contributions in there for 2012.  Once I have all my tax info I am going to see which IRA will save me the most money on taxes this year.

If I still have money to save after funding my  IRAs then I will put money into my stock account or add to my cash savings.  I’m also interested in putting some money in P2P loans but even with a 50% savings rate I don’t think I’ll have enough money to do that.  Another thing I’d like to do is open an individual 401k that would allow me to save all of my online income.  Whenever my van finally sells I will be putting all of that money into savings.

If I can live on $1000 a month then I’ll need to make at least $2000 a month to be able to save 50% of my income.  That doesn’t sound like much, but it is more money than I have ever made.  The 50% savings figure is based on my after-tax income.  My stretch goal is to save 50% of my pre-tax income, I’m not sure how achievable that will be.

The idea for living on minimum wage came from the minimum wage challenge at Saving Advice.  His goal is to live well in 2013 on minimum wage earnings.  I’m pretty sure I only made about minimum wage for 2012 so doing the same challenge shouldn’t be too difficult for me.  Minimum wage in Missouri for 2013 is $7.35 an hour, that adds up to gross earnings of $15,288 for the year based on a 40 hour week.  That would give me a monthly budget of $1274 which I think should be more than enough for me to live on.  Although I think that is plenty of money to spend for each month I did spend more than that this month.  I will have to be a little more disciplined if I am going to meet this goal in 2013.

The goal of living on minimum wage is complementary to my goal of saving 50% of my income since the less money I spend on living expenses the more I have available to save.  I’m hoping that I can get my monthly expenses under $1000 some months so that I have a little more to spend in other months.   My stretch goal will be to have my average monthly expenses under $1000 a month for the year.

The minimum wage amount is an arbitrary amount since my living on minimum wage will be different from those who have to live on minimum wage.   I plan to not just survive on minimum wage but to live well on it.  I’m not sure what I will consider living well, but I do plan on doing some traveling next year which I do consider part of living well.

Saving 50% of my income and living on minimum wage are my only two goals for now.  I do also have some things I want to do next year that I am not making goals at this time.  For now, I will just call them wishes.

One thing I would like to do is  finish hiking the Appalachian Trail.  I still have about half of it to do and it would take me several months to complete.  It would not cost much to hike the trail but it would take a lot of time.  That would make it difficult for me to earn enough money while  hiking to save 50% of my income.  I usually get tired of hiking after two or three weeks so it is very possible I will change my mind about doing this. That is one reason that it will just remain a wish for now.

Another thing I’d like to do is lose weight.  I have set that as goal many times and never made much progress.  I’m not going to set it as a goal for now, but it is definitely a wish.  I am going to try to eat healthier in 2013 and that should lead to weight loss.  If I do a lot of hiking that would lead to weight loss as well.

I’d also like to travel internationally next year.  I haven’t traveled out of the country since 2010 and I’d like to visit foreign countries every year.  This is something that would be difficult to do on a minimum wage income, but it is possible if I travel to a low cost destination.  It would cost a bit to get to a foreign country, but once there I could live on even less than I do in the United States.

Those are my current goals.  I will update my progress on them monthly.  And if I come up with some new goals I will let you know what they are.

 

4 thoughts on “2013 Goals: Save 50% of Income and Live on Minimum Wage”

  1. I agree that saving 50% of your income will be difficult. But with determination, it can be done! Living on minimum wage would be a challenge, too. Now I’m wondering if I could achieve these goals myself. Good luck with your goals for 2013!

  2. For 2013, improving the savings account and budgeting personal expenditures are part of my resolutions. This will be quite challenging for me because I don’t usually have a budget to follow.

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