If you have reached the big 3-0 and you are starting to think about your financial future, you are not alone. Many people in their 30's start to take their financial future (and their financial present) very seriously. However, most do not know what they can or should do to make good financial planning decisions.
Start an Emergency Fund
One of the best financial planning tips you can get in your 30's is to start an emergency fund. Ideally, you will have 6 months of bills and expenses saved up in your emergency fund at any given time. That way if you lose your job, get furloughed, or have another crisis in your life that prevents you from bringing in income for an extended period of time, you are covered. Set aside as much as you can towards your emergency fund every month until it is at that full 6-month level.
Then, do not access your emergency fund money for anything but a true emergency. Pretend that that money isn't there when it comes to purchases you simply want or even need to make. You should have room in your budget elsewhere to make certain big purchases if they come up.
Save 20 Percent of Your Income
Once you have an emergency fund fully funded, you should start to try to save at least 20 percent of your income into a general savings account every month. This saved money can be more accessible than your emergency fund and can be used for large, unexpected expenses like new appliances or a new car. The more you save and the less of it you spend, though, the better off you will be in your financial present and future.
Be Sure to Invest in Your Retirement
With all of this additional saving, it can be easy to overlook the necessity of saving for retirement. It may seem like a long way away, but retirement will come up faster than you might think and you want to have a nest egg saved for when that time comes.
If you work for a company that offers matching contributions to a certain percentage of your income toward retirement, max that out. Sometimes, for example, if you put 5 percent of your income directly into a company retirement fund, your employer will match that amount every month. That is free money towards your retirement. So, be sure to take them up on that offer.
Carry Health Insurance Always
While it may not seem like a financial planning decision, once you hit your 30's you should never go without health insurance again. Health insurance is vital to not only keeping you healthy but also towards saving your finances in case of a medical emergency.
Without insurance, you will have to pay your full medical bills out of pocket. But with health insurance, you will only pay a portion of those costs. This can save your emergency fund and savings from being ransacked if you experience an unexpected illness or injury.
With these financial planning tips in mind, you can be sure that you are taking care of your finances as well as possible now that you are in your 30's.
For more information, contact a financial planning service.
