I turned 30 at the end of last year. Reaching this milestone has really got me thinking about what I want to accomplish in the coming decade — especially in terms of finances. I made a lot of money mistakes while in my 20s, but, for the most part, those are rectified. But I don’t want to fall behind financially like I did during the first part of the last decade. So I’m making 8 financial goals for my 30s. Here are some things to consider as you move into the next phase of your life:
1. Pay off non-mortgage debt: It’s best if you have already paid off your credit cards. But if you haven’t, now is the time to tackle what remains of youthful indulgences with plastic. (And get out of the debt cycle once and for all.) Once that is done, your early 30s should be devoted to getting rid of auto loans, student loans and other debt that isn’t mortgage related. When your non-mortgage debt is paid off, you can start thinking of paying down your mortgage.
2. Protect what you have: Review your insurance policies. Make sure your home, auto and health are adequately covered. Look for ways to save money on insurance, yes, but make sure that you aren’t sacrificing the coverage you need. Consider the possible catastrophes that could occur, and plan for disability, accident and other unexpected expenses.
3. Check your life insurance: Now that you are more established, and possibly have a family, you need to make sure your dependents will be cared for should the unthinkable happen. Get coverage for your life. You can actually get good term life insurance coverage for very little while in your 30s.
4. Make a will: I admit that I still need to do this — and my son is seven years old. Thank heavens nothing has happened to my husband and me. It is vital to draft a will, and to make provisions for what happens if you become incapacitated in some way. Make sure that friends and family know where this information can be found, and that a couple of trusted people have copies.
5. Up your retirement contributions: Hopefully, you began saving for retirement in your 20s. If you didn’t, open a retirement account (or three). If you have a spouse, open retirement accounts for him/her as well. Look at what you have been investing in your retirement, and then figure out how much more you can put in. Reconsider your priorities; your kids can get loans for college, but you are on your own for retirement. Get serious about the future.
6. Consider your asset allocation: Now is the time to take a look at your investment portfolio and consider your asset allocation. Make a plan that fits your long term financial goals, and consider asset allocation and appropriate diversification as part of that plan. You might need professional help as you plan ahead. Just make sure you re-visit your portfolio at least once a year throughout your 30s to re-balance as needed.
7. Live a simple lifestyle: Find contentment with who you are and what you have, and attempt to live simply. This doesn’t mean that you can’t get out and enjoy yourself with the occasional treat or vacation, but it does mean that you need to train yourself to live within your means, and save up for those fun extras. Develop a sense of yourself, and contentment with that, and you will be less tempted to spend yourself into debt in order to keep up with friends and family who appear to be living large.
8. Keep your skills sharp: Continue learning so that you are up with technology, industry trends and certifications. Even if you aren’t pursuing a degree, engage in personal and career development so that you remain competitive and marketable.
Your 30s are a great time to improve your finances. It’s not too late to start over if your finances are a mess, and if you have managed to lay a solid financial foundation in your 20s, it’s the perfect time to build on it.
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Miranda is freelance journalist. She specializes in topics related to money, especially personal finance, small business, and investing. You can read more of my writing at Planting Money Seeds.