From your teen years to your 20s, it is safe to say you were navigating through the various complicated and confusing aspects of life. This is especially the case when money is involved. Now that you are in your 30s, you’re ready to make big-money decisions, such as buying your first home or gaining financial independence. Additionally, you want to avoid being financially stressed, like 70% of Americans. Therefore, building wealth is vital. However, it is also easier said than done. Fortunately, with the right tips and tricks, you will be well on your way to building wealth and obtaining your financial goals in your 30s. Here are a few to consider implementing today.
1. Get Rid of Your Debt
You may be in debt for several reasons, such as paying off your student loans or the bank loan you took out when you were more naive. However, debt can hinder your journey to building wealth in your 30s. Being in debt makes you anxious and prevents you from enjoying your profits or income, as it would need to go into financing your debt. Although paying your debts at once may seem like a smarter way of getting rid of them, it can do you more harm than good. Instead, you should consider implementing strategies to help clear your debt without being penniless afterward. For example, you can create and stick to a repayment plan to ensure you don’t miss out on payments. You can also prioritize your debts, choosing to get rid of the smaller ones and slowly working up to clearing the larger ones. With your debts cleared, you can enjoy earnings and comfortably find ways of maximizing them.
2. Establish Feasible Financial Goals
Now that you are in your 30s, you may generate income from a side hustle, a regular 9-to-5, or your own business. You may also have other financial responsibilities, such as paying rent or maintaining your car. These factors have drastically changed the financial goals you set for yourself when you were younger, which means it’s time to reexamine and reevaluate your financial plan. Generally speaking, a financial plan is a document that outlines your long-term and short-term financial goals. When recreating your financial plan, it is vital to consider using the SMART approach in outlining your goals. This gives your financial plan more details, making it feasible to accomplish.
3. Focus on Retirement Planning
Whether you plan on retiring early or working longer, your 30s are the best time to start planning for your imminent retirement. Your retirement plan is both the investment and savings for your future. Therefore, be sure to implement strategies that would ensure you are doing both. For example, You can take advantage of various retirement-saving incentives made available by your employer, such as a 401(k). You can also save towards retirement by opening an Individual Retirement Account (IRA). This account lets you delay paying taxes on your retirement savings until the money is withdrawn. Unlike the 401(k) account, which your employer manages, you own and manage your IRA.
Another factor to consider when creating your retirement plan is estate planning. In your 30s, you may feel like you don’t own much. Additionally, your life just began— estate planning seems too morbid and too soon a thought. However, estate planning in your 30s is an excellent idea as it ensures that the assets you earn will be well distributed and taken care of by the people you love when you’re gone. You can read these estate planning tips to guide you.
4. Utilize a Budget
It is impossible to talk about building wealth without highlighting the importance of a budget. When building wealth, the aim is to accumulate more money. This can be done by simply spending less. However, as you earn more, spending less can be quite challenging. This phenomenon is known as lifestyle inflation. When this occurs, you find yourself spending as much as you earn or even more. A budget is a simple yet effective solution to this problem. Having a budget gives you oversight of your earnings, savings, and spending. It allows you to check and track money going in and out. It helps you better analyze your finances, identify better ways to increase your income, such as investment opportunities, and reduce your expenditure.
5. Avoid Suspicious Investments
Investments are a sure way to earn income and build wealth. This is done in two ways. The first is by growing or appreciating the value of the investment, as is the case with properties. The second way investments help you increase or build wealth is by generating another source of income for you, such as dividends from shares. Making the right investments would safeguard you and your financial future from various mishappenings such as inflation. Investments are risks, as you cannot always determine how profitable they will be and for how long. However, a common mistake many make is not scrutinizing the investment opportunity to determine if it’s a risk worth taking. This usually leads to several issues, such as falling for investment scams. Therefore, be sure to choose safer, recommended channels of investment to prevent such issues. Additionally, you should remember that if an investment is too good to be true, it probably is.
6. Never Stop Learning
When increasing your wealth, knowledge is key. By gaining more knowledge about finances, managing your money, how to invest, and other useful information, you are better equipped to handle various aspects of your journey. Gaining more knowledge also helps increase your confidence as you better understand various topics and make smarter decisions. You can read recommended books on building wealth, such as Robert Kiyosaki’s “Rich Dad, Poor Dad,” “Think and Grow Rich,” by Napoleon Hill, and “You Are a Badass at Making Money” by Jen Sincero, to name a few. You should also consider reading reputable financial blogs as well as listening to podcasts and YouTube channels.
Building wealth in your 30s is an excellent way to become financially independent and secure your future. Following the tips mentioned above can help you accomplish this; however, exploring more tips and tricks is advisable. Additionally, you should remember that building wealth is a journey, so achieving your goals will take some time. But it isn’t impossible.
