How To: Track Your Progress

Track Your Progress

Track Your Progress

If you want to change it, track it.
(If you just want to get tracking already, click here to skip ahead.)

This simple mantra works everywhere.  Your diet?  Children’s bedtime? Car’s fuel efficiency?  Golf handicap?  But most importantly for today: Your Finances.

To change your financial picture, track your progress.  Below, I give a real life example of how to track progress towards a retirement goal.  Then, I’ll give you a link to a spreadsheet that’s pre-configured for you to set your own goals and track your own progress.

Prerequisites

Before you start tracking, you need a budget and you need a goal.  I suppose you can still track where you are, but it’s going to be more meaningful if you have a map (budget) and a destination (goal).

Sample Tracker – Physican Philosopher

Background – Physician Philosopher

I made a plan for the Physician Philosopher a few months back, and I’m curious how he’s doing.  As a quick recap, he’s a new attending physician with a plan to get out of debt quick and stack up assets towards an early retirement in 2032.  Starting in July 2017, he had a net worth of -$208,000.  By May 2018, he had about $130k in student debt, as well as a few car loans and a small mortgage.  But he also had been stockpiling assets for a year.  His net worth had climbed to -$67,800!

Track Your Progress

I’ve never published a curse word on this site, but Holy Shit. That’s a change of +$140k in under a year.

Goals – Physician Philosopher

From our conversation in June, his retirement goal can be distilled down to the following.

TPP Retirement Goal: $3.5 million in net worth by July 2032.

Plan – Physician Philosopher

Based on his savings rate, we put together a plan to reach those goals.  That plan can be summarized by this long term graph, which includes both best case and worst case scenarios:

Track Your Progress – Physician Philosopher

And now it’s been a few months, so let’s track how he’s doing.  First, I took the plan above and zoomed right in on 2018-2019:

Next, I grabbed the self reported data from TPP’s quarterly net worth update.  I think he should not include the emergency fund, but it’s okay – we’ll keep it.  I counted his emergency fund but excluded his house’s net value and kid’s 529 plans to find a net worth = +$8772 as of 8/1/2018.

Let’s drop his actual results on the above graph, zooming in a bit more:

TPP Track Your Progress

Interpreting Results – Physician Philosopher

So what should the Physician Philosopher take away from the above result?

  1. He’s on track!  He’s actually ahead of the plan.  Feels good.
  2. He could keep going at the accelerated pace to meet his long term goals sooner, or
  3. Feel comfortable with scaling back a bit.  Maybe that overdue vacation isn’t such an extravagance any more.  Maybe it’s okay to go out to eat a few times a month.

Tracking your progress means you don’t have to stay up worrying about reaching your goals.  If you’re short of the target, take action.  If you’re on target, stay the course.  Don’t waste time and energy wondering if you’re doing enough.

Go Track Yourself

Unless your name is The Physician Philosopher, you might be thinking “Okay, that’s a nice graph for him but what about me?”

I made a tracking spreadsheet very similar to the one above, and you can download it right now.



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lick the button above > Update your Profile > Checkbox the Track Your Progress Spreadsheet

Use the Tracking Sheet

With just a few bits of data entry, you should have a viable projection of your financial future:

Note that the spreadsheet will calculate a monthly contribution amount that you need to meet in order to stay on track.  Fall behind this contribution amount, and  you’re very likely to fall short of your goal.

Results

I configured the tracking sheet to show a short term result and a long term result, similar to this:

After you’ve put in your own goals, simply check in each month to see if you’re on track.  Close to the red line? You need to tighten your budget and work hard to get back on track.  Closer to the green line instead?  Like the Physician Philosopher, you can decide to accelerate your plans or just keep on course with the knowledge that you’re ahead of schedule to reach your goal.

If you want a diet to work, you have to check you weight on a consistent basis.  The same holds true for your financial goals.

Please let me know in the comments below if you find this tracking sheet useful, or if you have suggestions for how it can be improved.  I’m already making plans for Tracking Sheet Version 2!

2 Replies to “How To: Track Your Progress”

  1. Great stuff, mouse!!!

    Our trend will slow down a touch when we take our next step towards buying a house. We currently put $5500 scheduled payments towards our loans (+90% of my bonuses).

    Half of that scheduled payment will go towards a new mortgage and the other half towards a taxable account, once we are done paying off the student loans.

    For now, we will enjoy the awesome trjaectory that we are on!

    Thanks for the follow up.

    TPP

    1. It’s all the more impressive that you’ve stayed ahead of the curve during something of a “bleh” year for market returns. Nice job indeed!
      Cheers,
      M

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