Hitting your 30s allows you to think about major decisions in life including starting a family, getting a mortgage for a house, or saving up for your kids’ education. If you’ve enjoyed your 20s too much, then you can add debts to your list of worries as well. Because of these key decisions, saving up for the next couple of decades could very well be last in your priorities list. While that’s not a good idea, no one is blaming you for that… for now.
The fact of the matter is, going through your 30s on a very tight budget could affect your financial security – both now and in the long run. This is not saying planning for a family, or applying for housing mortgage is a bad idea. However, there are other ways to maintain a stable financial situation that can last not only during your 30s but continue until your retirement.
Planning Your Expenses Ahead
Most people who are preoccupied in spending their finances are unaware that there are still ways to become financially secure. But what does it mean to have financial security, anyway? It simply means being capable of acquiring funds, whether from a savings account or an insurance policy, under various circumstances.
For instance, in the event of an untoward incident such as a serious illness, a natural calamity, or getting laid off from work, do you have a buffer fund from where you can get finances? Being financially secured is being ready to face these kinds of situations without the need to beg, borrow, or steal. It doesn’t matter if you’re paying for the house and your child’s educational plan. If you are not prepared when these events arise, that means you are not yet secure.
So, What Can I Do?
Fortunately, moving from being financially troubled to becoming financially secure is simple as long as you are willing to do everything. “But I don’t have money to spare to save up,” is what you may be thinking right now. Before you completely ignore this idea, here are some easy steps you can take:
- Be a planner, not a saver – Professionals who are in their 20s and 30s sometimes deprive themselves of the good and necessary things in life just because they want to save money. As a result, they rarely enjoy the fruits of their own labor. A wiser approach is to plan all your short-term expenditures, including paying off debts, and stick with that plan until it’s completed. Once that’s done, then you can plan a new project to work on. You don’t have to starve yourself or avoid all the good things in life just because of a plan you have 30 years from now.
- Set up an emergency fund – Once you know which bills and expenses to prioritize, you can then set up an emergency fund. A sound amount for this fund is around five to six months of your current monthly expenses at home. But what if you don’t have the money because you already allotted it for those at the top of your priority list? If that’s your problem, just continue reading.
- Lower your cost of living – One of the most common reasons professionals in their 30s are having problems with their finances is that they tend to live beyond their means. Once they are capable of earning money, they would immediately indulge in various luxuries that take up a big chunk of their budget. Instead of drinking a cup of expensive coffee from the hippest café, why not brew one at home? That would be much cheaper. If you want to reduce your daily expenses and be able to set up an emergency fund, then choose a simpler and more cost-effective lifestyle without sacrificing the necessities.
- Learn more about finances – Simply reading books and resources about finances can greatly improve your knowledge about financial security and how to manage your finances properly. A lot of individuals who have succeeded in becoming financially secure found their inspiration in such resources.
- Use finances for investments – Once you have money to spare, you can also enter other opportunities not only to store, but also to grow your finances. You can try setting up a small business that can help you and your family in the long run. Other options include getting life insurance and investing in stocks and bonds.
Achieving Financial Independence is All Up to You
As you can see, there are a ton of opportunities to becoming financially secure even in your 30s. You don’t have to wait for retirement before availing your pension and retirement benefits. With the help of some lifestyle tweaking, and a few self-help tools, you can set up short- and long-term goals while preparing an emergency fund at the same time.
Seeking assistance from a financial adviser can also help shed light to some of your concerns. With advice from a professional, you will be able to understand the importance of insurance and find ways to successfully manage your finances. Don’t wait ‘till an emergency situation arises before working towards your financial independence and security.