Get Ready to Dominate Money in Your Thirties
This post is part of Women’s Money Week 2012. For more posts about Money in Your 20′s/30′s/40′s/50′s/Retirement see Money in Your 20′s/30′s/40′s/50′s/Retirement Roundup.
Our Twenties are fun, aren't they? Your Thirties will be even better! Not like the Depression 30s. Good times to come.
What happened to my twenties? Wait, I’m still in them. For another year and a few months, I’m a pretty average 20-something: single, no kids, no mortgage, decent job and…debt. What! How dare you! Confession: I was a bit unrestrained for the better part of my twenties. I needed to figure life out, which was great, but I also took a long time to figure money out, which was not so great for my wallet. I’m lucky to have done everything I did in my twenties, but I’m also lucky that I finally got serious about paying off my debt, saving and figuring out how to make more money independently of any job. So while I don’t regret a single minute of my 20s (and they’re not over yet!), I’ve got big plans for my thirties. It’s my chance to be a little more mature but still have plenty of energy to take on new projects, meet new friends and start new businesses. Here’s my plan of attack as I get ready to dominate my finances in my thirties.
Money in Our Thirties Starts to Get Complicated
The good news is that by the time I hit 30, I am on track to have paid off all or nearly all of my personal debt (credit cards, a student loan and an auto loan). I will have been saving with automatic bi-weekly contributions for a year and a half and contributing to my retirement accounts for several years. But there are also much bigger things that happen in our thirties like mortgages, marriages, children and providing for family members that start to make the overall picture more complicated. So what will be different in my thirties and how can I start preparing for it now?
1. Be Cash Flow Positive: The biggest change for me will be coming out ahead each month. Even if it is just $200, start preparing now in terms of expenses, income and future purchases so that you will always have some money left over at the end of each month, after accounting for expenses, debt payments (hopefully none) and savings.
2. Stay Consistent: My 20s were basically filled with instances of me starting jobs, quitting jobs, switching industries, moving to a new town, leaving the country, coming back, leaving again, looking for a new job and basically confusing the hell out of myself. Calm down, self. Sit down, drink a glass of water. One thing at a time. If you were never consistent in your 20s, your 30s are a new start. Focus on developing good habits, developing a career you can continue and progress in and finding out what works with you. You know what makes sense for you when it comes to exercise, work and everything else. Doing something consistently for two years or longer will start to show you returns you never thought possible-whether it’s taking up a sport, learning a craft, working or starting a new business.
3. Develop Ideas and Nurture Your Talents: We all have great ideas. I start my days with big ideas and end my nights brushing my teeth and mulling my latest idea over. The key is developing those ideas and being willing to take the next step. It’s knowing which ideas have to sit for now (creating and marketing a non-alcoholic beverage) and which ones need immediate action (improving my eBay inventory and listing strategy, finding new listing clients, etc). I love selling on eBay and it’s one small thing I’m developing. The success I have with eBay in turn motivates me to do the next thing well. It’s a happy slippery slope.
4. Make Savings a Priority: Make savings an accepted part of every dollar that comes in. Even if it’s just 5 or 10%, you can set up automatic savings transfers with almost any bank account and feel rewarded at the reminder of your growing balance. That savings account begins to represent many different things as you grow older. It is protection against unexpected loss of income, it is security for your children and family. I always feel the most vulnerable when it comes to my family. I want to do everything that I can for them. With debt or crazy financial obligations, I won’t be able to do that. I want to be more grounded in my thirties and a healthy amount of savings is just one small part of that.
5. Find Investments You Understand: Not everyone is going to make money doing complex options trading, volatile commodities trading, or currency trading. Some of us prefer investments we can see, touch or grasp more quickly. You don’t need to be a technical trader to make money off of your money. There are stocks and index funds that you can buy and hold and expect to appreciate in value. There are still real estate properties that can make excellent rental properties. There are also peer-to-peer lending clubs which allow you to invest in individual borrowers based on their credit rating. Start small, but begin your research. Don’t feel intimidated by people who love to use business jargon. Ask questions.
6. Plan Ahead for Upcoming Big Purchases: Most of us in our twenties had a few big purchases like cars, appliances and furniture. Hopefully you were able to purchase these items outright, but you’re not alone if you financed something in the $1,000-$20,000 range. In your thirties, you can expect that there will most likely be another car to buy, more furniture and kid’s expenses. Sub-divide your savings into individual categories so that you will be prepared for your next big purchase. Your thirties will be a lot more comfortable if you do not have a lot of small payments to deal with.
7. Make Your Dreams Come True: We all stumble in our teens and into our twenties. It’s a time of fun, exploration and learning about your own character. You’ll come out of your twenties wiser and more confident. What are your thirties going to be like? Do you know what you want to happen? Do you have big dreams and passions? Do you think you can do it? I say: Start believing in your destiny. All the great ones do. If you don’t, your thirties will pass you by before you know it.
I’m looking forward to my thirties. At 23 and 24, I dreaded getting older. Now I am exactly where I want to be in life. Did you (or do you) dread turning 30, 40 or 50? What did you learn in your 30s that you never thought about in your twenties? I can’t wait to read your comments!
I’m in my 20′s (early to mid) and I am trying to do all of these things even now. I want to build myself an awesome foundation for when I’m older.
I’m 27 and I’m not really dreading getting older. Age is just a number and I feel that I’m already 40 years old at heart.
I was very childish in my early 20′s and racked up a lot of debt (student loans, credit cards, and personal loans). My goal is to be completely debt free (not including mortgage) by the time I’m 30. We save quite a bit as it is, but I can’t wait to be debt free so I can aggressively save for retirement! 30 can’t get here soon enough!
I’m 33 and don’t dread getting older. I’m loving life!! I wasn’t the greatest with money in my mid-twenties, but better than most. I had a good foundation and continue to improve every day. When your 30, you’re still young and have plenty of time to save large sums of money. You just have to make it a point to start doing it. So do it!!
With these posts about money in 20s/30s, it’s really making me think more about where I am financially. My 20s had plenty of potential, but a lot of it was wasted. Now that I’m 31, I feel that it’s time to focus more on the future. Instead of jumping from job to job, I need to settle down and focus on my career and savings.
I just started my twenties, and this list is great for getting an idea of where I want my finances to ultimately be.
Great list! I’m hitting thirty this year myself, and many of these ring very true.
You are right; different ages have entirely different concerns (this is part of the difficulties with planning far ahead; you never know what would be important for you). I usually say that in our 20s we are interested in, well to put it blutly, ‘sex, drugs and rock-and-roll’; in our thirties we are interested in mortgages and children; in our forties we start worrying about pensions and investments; in our fifties we worry about growing up children and aging parents; in our 60s we get to varicose veins and haemorrhoids. This is how far I have got and this is two decades ahead of my age – so we shall see
.
As to the seven points you raise these are important at any age – we just get more serious about them when we get older.
Great post, and I completely agree. It’s amazing what can happen with consistentcy of purpose and action. Saving a few hundred dollars a month may not seem like much, but over time it really starts to add up fast. Same with investments, or learning a hobby as you mentioned.
great advice.. i am in my early 30′s and am trying my best to live to rules, pretty much identical to these..
I’m 45 now, but still feel the same as I did in my 30′s so does that count? Life in your 40′s should be more of the same as the 30′s right? Well I stood that notion on it’s head by retiring early and moving half way around the world. I don’t mind getting older, it’s inevitable. What I would mind is losing my youthful exuberance and passion for life. Whatever you want…go get it!
[...] Get Ready to Dominate Money in Your Thirties [...]
I’m in my early/mid twenties. I don’t dread getting older, but I do want to enjoy this time in my life as much as I can (responsibly, of course!)
Love all the tips, but my favorite is the one about believing in yourself/destiny. Don’t be afraid to fall and get up again. The greatest failure we can have is that resulting of inaction.
[...] American Debt Project wants everyone to dominate money in their thirties. [...]
I’m 29 and getting ready for the big 30. Although I use to think that 30 would be a big deal, it doesn’t seem that big anymore. I was pretty financially responsible in my 20s, but was in school most of the time and didn’t really have high paying jobs in between. Now I’m trying to figure out exactly what I want to do career-wise. Although my current job isn’t great paying it’s incredibly stressful and I’m thinking that in my 30s I’d rather have a less stressful (and possibly better paying) job in the corporate world, then a not so great paying, and horribly stressful job in a non-profit. We’ll see. I hope the next 10 years keep getting better and better. I’m certainly happier now then at 20.
Wonderful post. It looks like you got it all figured out. That’s pretty good for someone still in her twenty’s.
@Kari: You shound like you are exactly where I am a far as figuring out it out. A secure job is definitely a goo d start and I have my own opinions on working in non-profits, it’ definitely tough and even though I support their missions, it’s sometimes hard to make them efficient, organized, well-run affairs that compensate their employees competitively! Definitely want to hear more about your situation.
@Dr Dean: Thank you! Except it always sounds better on paper than the actuality
. I’m better at seeing the big picture than implementing it. Although I’m getting there…
@moneyinfant: Wow, such a good point about not losing your passion. It’s bad when everything becomes a “been there, done that” mentality! I definitely let that happen sometimes but it’s nice to be reminded about how that simple exuberance can keep our lives interesting.
[...] American Debt Project tells us how to dominate our finances in our 30′s! I don’t know what happened to my 20′s, but I’m 31 now, and I am ready to tackle those financial milestones. [...]
I’m 33, having started my thirties about three weeks after Lehman Bros collapsed. Needless to say it’s been a pretty crazy 30s so far. But I’ve been able to form a solid base and am very much looking forward to getting older! Great post.
I am actually enjoying my 30s much more than my 20s. I think a lot of things have changed since I turned 30, including my own approach to finances. In 30s we realize that retirement is not that far away, and that time flies faster than we think, and money is getting more and more important. I appreciate security and stability so much more now. Somehow I did not have this appreciation before.
I read a survey that said a good portion of those heading into their twenties don’t feel like they are financially self-sufficient (still rely on parents). Debt or no debt, it seems that just getting out of the nest is a great accomplishment in America.
40 is the new 20…didn’t you know?
While I had a great time in my 20s, I am actually looking forward to being a better version of me in my 40s. I definitely appreciate the value of building a solid financial foundation more now than I ever have.
I totally wasted/wondered around during the first 5 years of my twenties. And now with only 2 years left till I hit 30, I’ve been getting my finances back on track. Thankfully I’ve had a steady job (doing accounting) for 10 years, so at least I’ve had some stability. However, I was hit hard when I impulsively got married, bought a house and two cars then got divorced and ended up with a lot of debt. Sigh…live and learn.
I’m much more optimistic about my thirties and I definitely feel I have the confidence to make better decisions. I like your tip about positive cash flow – I am definitely on the same page there, and with making savings a priority. Great post!
I started my first job, marriage, kids, and first home in my early 20′s. So in many ways I feel like my 20′s were my 30′s. But now that I really am in my 30′s, I’m really starting to put into action all the plans I’ve made for my children’s college funds, retirement accounts, and big ticket purchases.
I graduated school in my mid-20s rather than my early 20s, because I switched programs and also opted to take part in the work-study portion of it. There definitely wasn’t any consistency during the mid-late 20s. I was trying to figure out if I was in the right career, bounced from job to job, feeling very unhappy and unfulfilled.I had also gotten out of a very serious long term relationship. It wasn’t until the start of my late-20s that I finally landed a position where I could see the potential of my career advance.
Sometimes you’re lucky enough to land the job in your early 20s and sometimes you need those years to figure out what you want to do. I will be turning 30 later this year and look forward to them, now that I am more financially savvy (but still learning of course!).