You’re likely making more money compared to 20s and maybe starting a family after 20s journey. It’s always tough to find out what exactly we should do in terms of savings and investing. We always have plans for spending money because that’s what for we work and earn the money.
Entering your 30s marks a significant milestone in your life journey. It’s a decade where you’re likely more established in your career, perhaps starting a family, and facing new financial responsibilities.
Here, we’ll explore strategic steps for navigating your financial landscape in your 30s, empowering you to thrive and achieve your financial goals.
I am sure most of the people would have heard about “start investing early in your 20s” but we never do that as we do not understand the actual purpose behind that.
Early investing gives you head start for building wealth as it uses power of compounding.
Example – If you invested 5000 per month for 8 years in your 20s in nifty index fund which gave average 12-14% return. You must have accumulated 8 lakhs considering 12% return. Now you stop investing after that and you keep getting 12% return for next 20 years then you will have almost 90 lakhs at the age of 50. Because once your base amount is ready, power of compounding takes over.
If you did not start in your 20s and now you want to start in your 30s then you have max 20 years to make 90 lakhs. let’s calculate how much you have to save every month to get 90 lakhs at the age of 50.
Result – You have to save 9000 per month for next 20 years to get there.
YOU CAN USE SIP CALCULATOR TO PLAY WITH THE NUMBERS
Don’t worry if you haven’t started investing yet. I know we cannot get back and catch missed out opportunities. You are not alone so start now with plans, and you will be able to build wealth you want.
As a first step, you must assess Your Current Financial Situation:
Before starting any financial journey, it’s very important to assess your current financial situation. Consider everything including your assets, liabilities, income, and expenses. Your assets could be anything like your Home, piece of Land, commercial property, Gold or anything which worth the money. Do not include depreciating assets like Cars, Laptops, etc.
Once you make a list of assets and debts you will be able to find out what’s exactly your net worth as of now. Next, you should categorize your assets in terms of liquidity. That will help you understand what assets can be utilized to make money in short term if required in any emergency cases.
Now you understand where you stand financially, you are ready to make financial goals.
Set Clear Financial Goals:
In your 30s, your financial goals may evolve as your priorities shift. Whether it’s buying a home, saving for your children’s education, or building a retirement home, define clear and achievable financial goals. Setting specific, measurable, attainable, relevant, and time-bound (SMART) goals helps chart a clear path toward financial success.
Create a Budget and Stick to It:
Budgeting remains a fundamental aspect of financial management at any age. Establishing a budget that aligns with your financial goals allows you to track your spending, identify areas for potential savings, and prioritize your expenses effectively. Start using tools and apps that simplify budgeting and expense tracking to stay on course.
If you do this step very religiously, you will get confident as time passes and you will be less pressurised for building wealth because you have set the Goals and also prepared aligned budget.
Manage Debt Wisely:
Debt management becomes increasingly important in your 30s, especially as you may have accumulated student loans, credit card debt, or mortgages. Develop a strategic plan to pay down high-interest debts while avoiding unnecessary debt accumulation. Explore debt consolidation options and refinancing strategies to streamline debt repayment and reduce interest costs.
Invest for the Future:
Your 30s present a prime opportunity to ramp up your investment efforts and harness the power of compounding. Allocate a portion of your income toward diversified investment vehicles such as stocks, bonds, mutual funds, and retirement accounts. Consider working with a financial advisor to tailor an investment strategy that aligns with your risk tolerance and long-term objectives.
Protect Your Financial Future with Insurance:
Insurance serves as a crucial safeguard against unexpected life events that could derail your financial progress. Evaluate your insurance needs, including health insurance, life insurance, disability insurance, and property insurance. Adequate coverage provides peace of mind and protects your financial well-being in the face of adversity.
Plan for Major Life Events
As you navigate your 30s, anticipate and plan for significant life events that may lie ahead. Whether it’s getting married, starting a family, or advancing your career, proactive planning enables you to mitigate financial stress and position yourself for success. Explore options for estate planning, creating wills, and establishing trusts to safeguard your legacy and provide for loved ones.
Conclusion:
Thriving in your 30s requires strategic financial planning, discipline, and a forward-thinking mindset. By assessing your current financial situation, setting clear goals, and implementing sound financial strategies, you can build a solid foundation for long-term success and wealth accumulation. Embrace the opportunities that this transformative decade offers and take proactive steps to secure your financial future.
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