Scott Burton Your financial habits are not great, as you will have probably maxed out your credit card, delayed any savings and focused mainly on pleasure spending. Your twenties are the time to have fun and its ok to make financial mistakes. However, the bad financial habits that you have accumulated in your twenties need to be gone before you head into your thirties. Being in your thirties is different, you become more responsible and yes a little more serious about life. Living in a cold damp house where it was party central every weekend doesn’t seem so appealing. The comforts of a warm centrally located apartment with your partner or a flatmate is the place you really want to be. You start to drink wine and your parties go from 100’s to dinner parties of 6! No police get called to your dinner parties! You will find that children, family, marriage, buying houses are the main topics of discussion amongst your friends. Shopping. Bills. More bills. Your health. Appointments. Money. Credit cards. Rent. Mortgages. Tax returns. Work. Some of these things were present in your twenties, and if you really wanted to ignore them you could but now you can’t. If you make the right financial choices in your twenties, many of the thirty something life events become not so stressful and far more pleasurable. The reason why,is because you have a good financial base! However, if you don’t make the right financial choices in your twenties, your life will be one of financial struggle – not only in your thirties but for ever. By pursing these 10 Financial Goals before you reach 30, you will have set the foundation for you to enjoy financial security and independence for the rest of your life.
1. Know Your Personal Financial Profile
I know that this doesn’t look like a financial goal however it is the key to your success in achieving your financial goals. You need to know what your values and beliefs are around money. What is your risk profile? Does spending money give you pleasure? Have you got good saving habits? When you see something you really want, do you justify to yourself how much you deserve it even though you cant afford it. Do you like credit cards? Are you ever able to pay your credit cards off in full every month? Do you bury you head in the sand when it comes to dealing with money? There are lots of financial personality profiles assessments on the internet and many of them are free. Here is a link to a great article on personalities and money. How Your Personality Affects Your Finances Go and find out what your relationship is like with money. Then decide if you have the commitment, desire and motivation to pursue these financial goals before you turn thirty.
2. Write Down Your Financial Goals.
Once you have an understanding of your financial personality, you can then start to plan your financial future. Write down your financial goals – short, medium and long term goals. The timeframes you set for these goals need to be aligned to your financial personality. Use the KISS and SMART metrics to write your goals. (Keep It Simple Smart) and (Specific, Measurable, Action, Realistic, and Time Bound). This financial goal needs you to be disciplined and focused. If you struggle with these personality traits – thats ok. Find someone who can help you or go on the internet and look for templates that you can use to guide you to writing your goals. Find out how to write your financial goals that are aligned to you and your current priorities in life. If you don’t take the time to put a financial plan in place by the time you reach your thirties, you increase your chances of failing to achieve those financial outcomes that will enable you to live your dream life.
3. Stop Impulse Spending
Give up your bad habits around spending. The sooner you give up the habit of impulse spending, the better off you will be financially. Try to understand why this behaviour is important to you as it does not serve you well. This behaviour does not support wealth creation. If you continue to spend impulsively your financial future going into your thirties and beyond, will be a struggle. Don’t stop enjoying your life and spending money all together. You should be spending money on things that make you feel good. Just be realistic about your spending habits. If your spending is reckless and impulsive, then do something about it.
4. Get an App To Track Your Expenses
If you are in your twenties and you have a negative perception or no motivation to budget or track your expenses you need to change right now. Holding on to these beliefs will hold you back from having any financial security in your thirties and later in life. Keeping a track of of your expenses is one of the key financial habits that will enable you to have financial wealth and independence in your life. There are some amazing budgeting apps that you can download. Go search for these apps as they enable you to budget and monitor your expenses with ease and no stress. When you reach thirty it is essential that you are able to live within your means otherwise you will find yourself drowning in debt. Remember your thirties will bring more expense and cost to your life. Good budgeting habits will ensure you are prepared to manage these extra costs and live within your means.
5. Learn About Investing
To create long term wealth you need to become educated about investment. The best time to start getting the basics sorted around investment and start building your wealth is now – as you head into your thirties. With sound investment planning in your twenties you should have an investment portfolio up and running by the time you are thirty. Investing in your future now, before you turn thirty, ensures that you will reap the financial rewards of security and independence for the rest of your life.
6. Learn How To Manage Your Debt
Don’t borrow money to buy depreciating assets is a key rule to managing debt. Debt can work in your favour, but only when you use it for things that tend to rise in value over a reasonable period of time. Using borrowed money to invest in a house, a business or an investment (which includes your education) is the sensible use of debt. However you still have to pay the debt of and if you don have a plan to manage your debt, then interest will compound and your debt will triple. Borrowing to buy a new phone, pair of shoes, TV, or car is not a smart use of debt. Get rid of your BAD DEBT – credit cards, higher purchase or car payments. Avoid credit card debt like the plague. There is a very simple rule to follow when you spending, if you have to borrow money for it, then you simply can’t afford it – that includes using credit cards.
7. Get Insurance And Start Saving For Emergencies
In your twenties the concept of an “personal emergency” is never thought about because it just doesn’t happen in your twenties. If an emergency occurs usually your parents will sort it out. However that it all changes in your thirties and things like Life Insurance, Income Protection Insurance and Mortgage Payments start to appear in your lives. You need to protect your future. Setting up a fund and getting insurance for you to call on in an emergency is a great financial goal to have underway as you enter into your thirties.
8.Stop Relying On Your Parents For Money
If you are still relying on your parents to financially support you when you are thirty, you should be worried. I get that you may have a student loan and in your twenties your parents were your ATM machine however this is a bad habit to maintain as you go into your thirties. It is pretty much guaranteed that if you have bad debt and still rely on a monthly allowance from your parents then your chances of having financial independence and creating wealth in your life will not happen. That is your reality.
9. Start A Retirement Account
There is no way you would have missed all the hype that has been promoted about how important it is to start saving for your retirement in your twenties. The book Get A Financial Life by Beth Kobliner focuses on helping people in their twenties and thirties get their personal finances sorted. In her book Beth Kobliner outlines an example to show how the power of time on your investments works. When you are investing in your future with the goal to achieving financial freedom, then time is your biggest ally. Start saving and investing now before you reach thirty.
10. Develop A Financial Abundant Mindset
How you handle your relationship with money in your twenties will influence how you live the rest of your life. Ken Ndengu Starting to develop a mindset that supports financial abundance, will help you to prosper in the future both financially and personally. A person who has a financially abundant mindset is one who has developed knowledge and skills to acquire financial wealth however balances that with philanthropy and generous giving. Pursing these 10 financial goals before you reach thirty will guarantee you financial security and independence for the rest of your life. You have the power and the choice as you head into your thirties to create the life you desire. I hope you choose well.
title: “10 Financial Goals To Pursue Before You Reach Your 30S” ShowToc: true date: “2023-01-15” author: “Bruce Louviere”
It is a great feeling knowing you are on track with your money, and now is the perfect time to start working towards financial security. Check out 10 financial goals to pursue before you turn 30.
1. Focus On Paying Off All Of Your Debt
This does mean all of your debt; student loans, credit cards and any auto debts. All of these payments come with interest, and some of the interest is very high. Focus on paying off your debt first; the repayments and interest will keep sucking up your money until they are totally paid off. Paying off your high interest debt makes hitting financial goals and saving money much easier, and you will feel great once you have made that final payment!
2. Create A Monthly Budget Plan
Saving and paying off debt is much easier when you have a budget plan in place. When you have a free evening, sit down and write down all of your earnings and expenses. Set money aside for rent, bills, food, entertainment, paying off debts and savings. When you have a set amount of money to spend, you will notice you are saving money without having to think about it too much.
3. Stop Impulse Spending
Impulse spending can decrease your savings – as well as often being a waste of money! Before you buy yourself something, ask yourself these questions; Do I need this? Why? Am I paying for this with my weekly allowance, or with my savings? A good rule of thumb is if you are paying with your savings, put it down. If you are paying for it with your weekly spending budget, come back the next day and buy it then if you still want it.
4. Set Career Based Financial Goals
It is likely you already have plans to advance your career and earn more money, but writing these plans down can help you to solidify them, as well as motivating you to work towards them. Try to set a rough time limit to achieve them, as this way you can check that you are staying on track.
5. Get Rid Of One Luxury
Most people have a few luxuries or treats they regularly buy. Try to track your spending for a month and see if there is any money that is being wasted. For instance, many people buy lunch or coffee every day, but swapping to homemade can make a big financial difference. Try to cut out one luxury, and save the money instead. Keep your other treats as a reward for your savings!
6. Pay Your Bills On Time
One of the most important financial goals in your twenties is to pay your bills on time. Unpaid bills will leave you with bad credit, and they can pile up and become even harder to pay. Try to stay on top of the bill by setting up an automatic payment so you never miss another one.
7. Aim To Have Emergency Savings That Equal 6 Months Of Living Expenses
It may seem like a large amount of money, but through monthly saving you will eventually have enough savings to cover half a year of living expenses. The future is uncertain, and your life will feel less stressful if you know you have a safety net for worse case scenarios. Try to also put your savings in a high yield account to benefit you financially as you save.
8. Save For A Home
It isn’t essential to save for a home in your twenties, but if you have paid off all of your debts it is often a smart idea. Saving up for a home takes a long time, and the sooner you start, the sooner you will be able to get on the property ladder – if that is something you are interested in doing.
9. Invest Wisely
Investing is a useful way to increase your savings, but be sensible if you are going to invest. Seek guidance from trained professionals, and let them support and guide you whenever you make investment decisions. Try to take notes, too, as they will help you to make your own financial decisions in the future.
10. Start To Save For Retirement
While saving for retirement might feel like something you could put off for another decade or so, putting a small amount of money aside each month will make a huge difference. It doesn’t have to be much at this point, so take a look at your budget and see how much you can spare. Even $10 a month will help to set you up for the future. A general rule of thumb is to try and save 5% of your wage, and slowly raise that up to 20% over time.
