For most of us, our 20s were the best years of our lives – we started earning income and had few responsibilities. Most of our money typically went to booze, holidays, shopping and maybe that first car. Then come the big 3-0 and our life suddenly changes. We now have to “grow up” – settle into our careers, get married, start a family and here comes along a whole bunch of financial responsibilities including your child’s university fund.
So what are some financial commandments every 30-something ought to know in this make or break decade?
1. Rework your budget
All that money on Happy Hour and holidays? It’s time to work out the balancing act between your wants and needs and adjust your budget accordingly to your life situation. Are you planning to have kids? Thinking of starting your own business? Then perhaps that dream #yolo trip to Tahiti and other wasteful splurges shouldn’t be on the cards.
If you don’t already have insurance, it’s time you start getting coverage pronto. If you have already have, then you should start to know what exactly you are insured for. For example, do you know the difference between Life vs Term Insurance and which is the better choice for you?
Additionally, as your assets grow, you may need more insurance to cover them.
Schedule that appointment with your insurance advisor.
Yes, we all know that wise adage – to save for a rainy day. But how much savings is enough? As a general gauge you should aim to put away 15% (at the very least 10%) of your salary for retirement. To find out how much savings you should have by now, you might want to take a look at this article.
4. Plan for retirement
I know retirement sounds really far away but this is the time that you perform that calculation. Use an online retirement calculator to work out what you’d need (and perhaps want) in retirement and how you’re going to work towards that goal.
5. Value your time
At this stage in life, you’ll probably realise how much (or rather, how little) time we have. Make the time that we have count. Look for ways to maximise your time and make your financial life as simple as possible. Set up GIRO payments for your bills, automate standing transfers, shop online – make time work for you for the little things, so you can then work on the big things.