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Happy New Year! It's that time of year where people make all kinds of new year resolutions. Two months later those resolutions of working out and saving money are gone. I have never been a big fan of resolutions, because I feel like everybody breaks their resolution. Therefore, I never set resolutions, but instead I set goals.

Last July, my wife and I took on a challenge - buy nothing new for three months. We were not successful for the three months, but we were able to knock down our new purchases and make a mind set shift. By the end of our challenge, we had only purchased 6 new items. That was 2 brand new items each month.

Not too bad in my opinion, but not completing the challenge completely in 2017 has motivated us to take on another challenge and set two major financial goals in 2018.

Our Goals for 2018:

Live with a Frugal Mentality in 2018

Pay Off $20,000 in Principal on Our House in 2018

Frugal can be defined in many ways in the dictionary, but my favorite definition of frugal is "not wasteful." Basically, this means that we are trying to live in the year of 2018 without wasting our money. Instead, we want a basic plan to help us attain our goal of living frugally.

To accomplish our goals, we must set some parameters:

Make a budget each month that will help us accomplish our goals.
Buy Nothing New from February to May (a 4-month Challenge of avoiding new stuff)
Buy Nothing New from July to November (a 5-month Challenge of avoiding new stuff)
Three break months throughout the year (January, June and December)

Just like with our Nothing New Challenge in 2017, there will be some exceptions during our nothing new months:

Groceries
Diapers and Other Household Consumables (Includes batteries, paper towels, etc.)
Underwear
Socks and Shoes
Photo Prints
Birthday Invitations and Birth Announcements
Car Maintenance
Home Maintenance
Experiences (date nights, trips, etc)

I actually think that is a pretty long list of exceptions. However, there are some trouble areas that could cause some problems (clothing and gifts)

Clothing

My wife loves to shop for clothing for our daughter. We will try to work our way around the difficulty of clothing by buying used items or making sure to purchase new items in our break months of June and December. I am in need of some new dress pants and even some jeans. I plan on trying my luck at Goodwill.

Gifts

When it comes to gifting, we have a couple options:

Gift Cards
Cash
Use points on Amazon or my wife's work to purchase new items for free
Make handmade gifts
Gift Stock in a Company

Strategies to Accomplish Our 2018 Goal of Frugality:

During our buy nothing new months, we are allowed to purchase items from the following places:

Garage Sales
Consignment Auctions
Resale Stores (like Goodwill or Once Upon a Child)

This means that we just can't go to the mall and shop. This means that we will have to get creative with our purchases. Anything used or refurbished is fair game! To avoid buying new stuff, we will also try to wear out the items that we already own or fix our items, before we go out and buy a new one.

Our Goal of Paying $20,000 on our Mortgage in 2018

A by product of frugality is more money left over at the end of each month. Of course, we will throw our money towards savings, but we will also attempt to send a good chunk of our extra income towards our mortgage.

As a couple, we have a goal to pay off our mortgage as soon as possible. This doesn't just happen by accident. Instead, you have to be intentional about making things happen with your money. Last year, we were not as intentional with making extra mortgage payments and the payments slipped a little. We paid off a total of $13,452.93 in principal payments in 12 months. Our payment breakdown from last year is listed below.

Scheduled Principal Payments: $10,257.93
Extra Principal Payments: $3,195

Last year, we made just over three thousand dollars in extra principal payments. To reach our goal of $20,000, we will have to make around $8,500 in extra principal payments during the course of the year. Our estimated principal payment breakdown in 2018: