2012 Summit Meeting Done

Jan 9, 2012 by

Naw, I’m kidding. My wife is an excellent money partner. And so am I, right, dear?

Near the start of each year, my wife and I convene what I’ve dubbed our Summit Meeting. Summits help re-anchor us to goals, and we deal in one day with what could be a year’s worth of disagreement on the inescapable trade-offs among spending, saving, and investing priorities. That can be a lot of contention jammed into one day, so we try to keep it light, and we’ve made adult beverages a critical ingredient of Summits.

After many years, we’ve settled on an agenda. I’m sharing this not because I think you’re interested in our lives—I know you’re not—but because I’ve found that these meetings are a critical part of helping us make better money choices over time, which is what Money Counselor is about. I encourage you to try out the technique, customized to suit your family, personalities, and situation.

No reason to be "All Shook Up" about Summits

Summit Agenda

  • Review our actual vs. budgeted spending for the year just ended  We’ve been tracking our spending since 1998. To give one example from the summit just ended of what we do here: We spent $2,600 on eating out in 2011 compared to a budget of $1,740—a whopping 50% “unfavorable variance” (as I like to call it from my days as a corporate budget guru). So we got way off track. We look at the details (spit out by our personal finance software) of our eating out spending, then we ask ourselves: Well, do we want to keep eating out as much, or do we want to cut spending on eating out in 2012 and instead spend the money on something else or save it? We think we’d like to save more, so we’ll probably aim to hold our 2012 eating out budget to something like $150 per month and be more conscious of that particular indulgence.
  • Review notes from last year’s summit  This trip down memory lane I think is my wife’s favorite part of the Summit. She reads aloud her notes made during last year’s Summit in each of the sections below, and we talk about why things did or didn’t turn out as planned. In particular, she likes to make predictions regarding the stock market, oil prices, our net worth, and so on as part of the Summit, and this is where she gets to see how well she did. I won’t comment on her forecasting talents, except to say that she’s a sweetheart. 🙂
  • Goals  Again, my wife finds this agenda item more engaging than I do. She set six goals; I have one: “Stay mobile and don’t break any bones.” Or maybe that’s two goals.
  • Trips  Travel is expensive, so we try here to identify the major trips we want to take during the year. Typically we can afford only a fraction of the trips we’d like to take. Fortunately we have endless opportunities for regional recreational trips. But visiting family is always a long trip, requiring airfare.
  • House Projects  We moved into our house about 2½ years ago, and spent a lot on renovating. Thankfully, that’s over, so now we’re focused more on maintenance and modest improvements. My wife is ready to replace our vintage kitchen appliance. Though the dishwasher doesn’t do a good job, I like the range and fridge and see no reason to send them to a landfill. No resolution on this one; I’ll be a bit suspicious of sabotage should an appliance fail.
  • Investments & Saving Goals  Mainly we talk about asset allocation here—stocks, bonds, cash, pork bellies, etc. My wife reads a lot of financial books and news, and she’s convinced stocks are going to crash. As we have only 18% of our financial assets in stocks—much less than any financial planner would recommend—we’re not too vulnerable, but she wants to sell it all I think. We’ll probably compromise and sell about half of what we have left. My problem is, what to do with the proceeds? As I discussed in a recent post, nothing looks appealing to me right now.
  • Work Goals  My wife thinks we need to continue earning a lot of money; I don’t. So she does, and I don’t. I do my best to keep her from becoming resentful by handling most ‘family duties,’ and I’m hoping this blog will generate income. So you don’t think I’m a complete slug, I do work part-time, I help run the carsharing cooperative in my community (this is a volunteer gig, but takes a lot of time), and I like to stare out the window and think a lot.
  • 2011 Accomplishments  Patting ourselves on the back is a fun part of every Summit.
  • Predictions for 2012  As mentioned above, my wife enjoys forecasting macro numbers like the Dow Industrial Index and oil prices. I’ve learned that once I decide something is definitely going to happen, the opposite will almost surely happen. (Remember the Seinfeld episode where George starts doing the opposite of his instinct and suddenly everything starts working for him? My instincts evidently are as poor as George’s.) So my approach is to set ourselves up so we’ll be fine no matter what happens, rather than aligning our situation in concert with a particular set of predicted external events. In short, I’m a singles hitter, not a homerun hitter, but I rarely strike out. My wife is more inclined to swing for the fences.
  • Budget for Upcoming Year  Here we have a discussion, sort of like the one described above about eating out, for every discretionary spending line. A lot of the budget lines are easy because we have no control and they don’t change a lot year-to-year: property tax, insurance, and some utilities are examples. For the others, after reviewing the transaction detail in each budget spending line, we either recommit to cutting spending if we went over our budget in 2011, or we accept 2011’s spending and budget more in 2012.

That’s it. Best case: Our Summit Meeting can take a couple of hours. Worst case: Sometimes I wonder whether the gavel has yet fallen on our 2002 Summit Meeting.

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