Often people experience some of life’s biggest milestones in their thirties. Marriage, children, advancing careers, and homeownership are a few examples. All of these life changes come with new financial responsibilities, requiring a new outlook on your overall financial goals and the plan to achieve them.
So let’s look at seven critical financial tips for your 30s.
Tip 1: Save for a Rainy Day
By your thirties, you should have plenty of experience creating and contributing to an emergency savings fund. If you’ve had to dip into it, hopefully, you had good reason and the experience offered a valuable lesson as to the importance of saving.
As a thirty-something, you should continue saving, but you’ll likely need to up the stakes. A good rule of thumb is to try to have six months of your net salary in savings at any given point. This sum gives you a buffer against unforeseen circumstances, enabling you to provide for yourself and your family as you navigate the challenge.
Tip 2: Pay Off Those Debts
Perhaps in your twenties, you overused your credit card on nights out and lavish nonessentials. But in your thirties, with new responsibilities, it’s time to manage your budget wisely and pay off your debts.
Crippling credit card debt can be just that: crippling. Lenders will look the other way if you apply for a mortgage with too much debt, and saving for a deposit will be next to impossible. So pay off those store cards and credit cards or they could prevent you from achieving your goals.
Remember that while paid and maintained debt can help your credit score, too much debt burden can hurt your application for a mortgage.
Tip 3: Look to the Future
Hopefully, by this stage in your life, you’ve started a retirement fund. If not, do so immediately. If you have one, start upping your contributions to at least 15% of your earnings.
This is another reason to pay off your debt as soon as possible; with debt under control, you’re better able to funnel enough money into your retirement funds and ensure you and your family are comfortable in the future. Remember that you need to account for inflation to ensure a stress-free retirement.
Tip 4: Organize Your Estate
Concerns about your estate may seem like a distant worry at this stage; but remember, it’s wise to have your estate organized so you’re prepared for any eventuality. The older you get, the more critical it becomes to plan for the future so your passing does not become an unnecessary burden on your loved ones.
Ensure that you have a last will in place and that the beneficiaries of your estate are noted and informed of their status. Of course, it’s always best to seek legal advice for these sorts of things, so do your research and find a good lawyer or financial advisor.
Tip 5: Think About Term Life Insurance
As with estate planning, life insurance may seem like a future concern, but you must consider your dependents and family members. Think about what would happen if you passed away suddenly next week. Would your family be comfortable? Would the funeral be covered?
These considerations are vital, and the longer you leave it, the more expensive the monthly payments become. So do your research today and get covered.
Tip 6: Get Financial Guidance
As mentioned, your thirties bring some of the most significant financial events of your life. Since most people are not finance experts, many choose to consult a financial planner or accountant to help sort through household economics and make wise decisions both now and in the future.
With sound financial guidance, you’ll be able to successfully monitor your finances, invest wisely, and have someone in your corner if things get tough.
Tip 7: Take Risks
This is by no means an invitation to go and blow your pension fund on a crazy business idea. It is, however, a reminder that this is probably the last chance you have to take a little risk or two that might offer some good returns.
Take a look at some high-yield stocks, dabble in crypto, or try and fund your freelance ambitions. Of course, it’s better to do this before your 40s and 50s, and remember, always be smart and never take too many (or too few) risks.