By the time you reach your 30s you should be accumulating assets for the long run, meaning saving and growing your financial assets through earnings, savings, investment returns, retirement savings, real estate, etc. Aside from accumulating assets for what lies ahead there are a few other financial goals you should strive to meet in your 30s in order to set you up for a successful financial future. Below are 10 financial goals everyone should meet in their 30s.
- Pay Off Your Credit Card
Begin your 30s by paying off all the remaining debt on your credit card from your 20s. If you have already tackled all of your credit card debt in your 20s, that’s great! Once you have paid off all of the remaining debt on your credit cards, you can focus on paying off your auto loan debt, student loans, personal bills, etc. By paying off your non-mortgage debt, you will be one step closer to being able to make larger payments on your mortgage.
- Establish a Good Credit Score
A good credit score is beneficial for many reasons. When you purchase a new car, buy a house, purchase home appliances, etc. your credit score will determine the interest rate you are charged. A good credit score can lead to better results and cash saved overtime.
- Create an Emergency Fund
It is crucial to have an emergency fund that can cover necessary expenses that may arise out of nowhere. Having an emergency fund that covers up to three months of household expenses is ideal. Since an emergency fund is not a bill you are required to pay, it can be easy to put off. Setting up automatic deposits to an emergency fund savings account is a great idea that way you’ll ensure regular contributions. To begin, start saving a small amount out of your paycheck. Create a goal of saving $40 per week, which amounts to $160 per month, and then increase your weekly savings goal as you become more comfortable.
- Stabilize Your Finances
By now you should have a strong understanding of how to effectively budget your income. A budget tracks your income and expenses and can help you gain financial control, identify bad habits, and understand how much you can spend and save. Make sure you’re not spending more than you take in every month at the very least, but ensuring you have funds to put towards savings without financial strain is where you should aim to be.
- Set a Retirement Target Date and Amount
You should be accumulating savings into a retirement plan by now. If you don’t have one offered by your employer, you can always reach out to a financial advisor, like our own Steve Pierce, who can explore the best options for you. You also should have a good idea how much money will be in your retirement accounts by the time you retire. Retirement age is 66, so do the math and figure out how much you’ll need by then. Your financial advisor can also help you with this.
- Consider Your Asset Allocation
Diversification is key. Make sure your asset allocation strategy balances the appropriate risk verse reward you are comfortable with. When identifying other sources of retirement income that you are able to count on during retirement, aside from the typical 401K, look into Roth IRA’s, whole life insurance, and Roth 401K’s. Dover Federal’s financial advisor, Steven Peirce, can assist you with all your questions and concerns regarding asset allocation and retirement income.
- Make a Will
Life is unpredictable. It is smart to always be prepared for the unknown. Take time to create a will so it can assist in guiding any important decisions that will need to be made if something were to happen to you.
- Have Regular Money Conversations with Your Partner
Regardless of having a partner or not, conversations about money can be used as a time to reflect and provide clarity. It is important to create a shared vision of what you and your partner’s financial goals are. Having a conversation can also create structure for your finances. If you do not have a partner, it is still beneficial to have this conversation with yourself to make sure you are staying on top of your goals.
- Consider Continuing Your Education
Continue learning in order to stay educated and marketable! Consider going back to Community College, online schooling, taking class part time, or taking courses through a service like Skillshare.com or other online learning repositories. There are many options and it never hurts to expand your education.
- Factor in Money to Have Fun
Having fun is a part of life. If we couldn’t have fun, then life would be pretty boring. When calculating your monthly budget, put some money aside for the well-deserved vacation you’ve been wanting to go on, the new movie that just came to theaters, or the sports game you’ve been wanting to go to.
It is important to have a strong understanding of how to be financially successful in your 30s in order to better prepare you for what lies ahead. If you have any specific questions related to your personal finances or how to achieve the 10 goals explained above, our financial advisor, Steve Peirce, can assist you wherever needed.