The Steps To Financial Security Before 30
What steps should we be taking to set ourselves up right before we hit 30? Inspired by Ken Hawkins at Globe and Mail, here are some moves you should consider making.
Have Fun
Your 20s is a time when you have to juggle spending money on today as opposed to spending it on the future. It’s a hard balance to strike, and it’s important to not remember not to live in a state of deprivation. You can enjoy every stage of life without coming financially unstuck.
Invest In Your Asset: You
Investing in yourself- your skills, your experience, your education is crucial. As Hawkins mentions, your job and future career is the most important aspect of financial independence and security. So set yourself up well for the next 40 years by investing in yourself now.
Don’t Just Save, Plan
Research shows that people who are goal-oriented and have time-specific plans achieve more wealth than those who don’t. Saving some of your pay cheque every week is fabulous, but you need to have an action plan for debt, for big purchases, for starting a family, Control your life, and plan ahead.
Understand The Short-Term
You can’t foresee what is going to happen. And while you can make great decisions, you can’t control what is going to happen either. So control your short-term- manage your spending, keep saving, keep paying off debt. Know what you need to do this week to set yourself up properly for the future, and to achieve your goals. But don’t get tethered to a long-term, with no ability to change should things pan out different.
Keep Retirement At The Back Of Your Mind
Not the front. You’re young, and if you are doing things the right way now, you’re on a good track. Maybe think about setting up automatic deductions into a retirement fund, certainly keep an eye on your super, but don’t get too paranoid. Good financial actions now pan out into good financial futures.
Spend Less Than You Earn
The simplest way to keep financially secure. It seems obvious, but can often be harder than it looks. Yet it is the only way to have a good financial future. If you do nothing else in this article, do this one.
Get Literate
You might think you already know how to manage your money, but there’s always something more to be learned. Keeping up-to-date on financial management skills, talking to experts, continually appraising your own systems, is a great way to ensure long-term financial security.
Borrow For Investment, Not Lifestyle
So easy to do, and such a death trap. Learn to live with life’s rubs. The older car. The worn jeans. If you can only borrow for the things that really matter to you, and have in-depth plans about how to pay back the debt, then you are prepared for a life of financial security. Borrow to finance all the things that will keep you financially ahead of the game in the years to come, not all the things that just look like you’re on top of your finances.
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