The Best Financial Advice at Every Age
BY ARIELLE O’SHEA
Money doesn’t really age: It’s never too late to make smart financial decisions. But there are certain times in your life that are prime for specific money moves, times when making the right choice will set your future self up for success. Below, the best financial moves to make by decade. IN YOUR 20s: LAY A FOUNDATION You’ll probably enter and exit these years at two completely different life stages: Many people come into their 20s in college and cross the bridge to 30 with a decent, if short, career history. The good news: You have time to recover from bad decisions. The bad news: Any unwise habits you form now could stick with you. “This is the best time to make saving money a priority and the best time to avoid some pitfalls like getting into a lot of credit card debt,” says Ted Schumann II, managing partner of independent registered investment advisory firm The DBS Companies. There’s one way to do both, and it’s creating a reasonable budget that aligns with your priorities and includes at least some allocation toward savings, even if it it’s a small one. That money should go toward building a small emergency cushion and into an employer retirement plan that matches your contributions — like a 401(k) — if you have one. If not, open an individual retirement account. (We have a full guide to IRAs here.) IN YOUR 30s: HIT YOUR SAVINGS GOALS These might be your best investing years, so it pays — quite literally — to use them wisely. While previously you may have been scraping bits together, now it’s time to get focused. The goal: saving 15% of your income for retirement. The first two decades of “adulthood” are so important because time is the single biggest asset you have when it comes to growing your money (aside, of course, from money itself). Investing early gives your money time to grow through compound interest.
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