Financial Advice for 30-Year Olds That Will Give You Peace of Mind

Thirty is an age that we confer an utter most importance to in our society. We’re downright obsessed with it. It’s the age you’re supposed to have everything figured out and the true adulting sets in. Yet for most Millennials, stagnant wages and high student loan debt have made some trademark milestones of this coming of age, such as homeownership, marriage, and children, so much harder to reach.

I’m closer to 30 than I am to 20, but I feel pretty calm about its fast approach. A key reason for my peace of mind is that I’ve spent the last few years working my butt off to get myself into a financial position I want to be in by the time I hit the big 3-0.

So how did I get here? I set up systems and created a plan that allows me to cruise into 30 looking pretty good as far as the financials are concerned. In my early twenties, I lived paycheck to paycheck. Being broke is a mental and physical burden. I hated it, but it helped me see the importance of building savings and putting money away for my future. I opened an IRA when I was 26 with $2,000, and I’ve consistently added to it over the past two years. I’ve also opened up a solo 401k and have slowly added to that. Building a cushion for retirement has given me peace of mind, and it has made saving a habit. I’m doing something good for myself each time I tuck a dollar away.

I know you can find your financial zen too. So, I’ve outlined three financial goals and three financial burdens that have helped me reach a positive money mindset before 30.

Financial Goals

  • Have at least 1x your annual salary in retirement savings. If you haven’t begun saving for retirement at all and you’re 29, this one might be hard to reach. But all the more reason to start today! Compound interest favors the young, so the earlier you start saving, the more time your money has to grow. I started saving for retirement at 26. By the time I’m 30, I’ll have saved up one year’s salary. Here are three easy steps to increase your savings rate: If you have a 401k at work, increase your contributions. Put tax refunds, birthday money, or anything you earn from a side hustle towards retirement for the whole year. Automate savings through your bank, like with Chime’s automatic savings. The beauty of automatic savings is that you won’t miss the money that never makes it to your checking account.
  • Get life insurance. I know it seems like a scam at first, but life insurance is pretty cheap and comes with big rewards. Especially for those of us that are married, have dependents, or own property. Life insurance can be a huge financial boon to loved ones in the event that you pass suddenly. It can be used to pay off debts, mortgages or to pay for a funeral. Life insurance is true adulting, so pat yourself on the back for meeting this milestone. PolicyGenius is a great place to start gathering quotes for affordable options.
  • Pay off student loans. By the time most people hit 30, they’ve been out of college for eight years. The average payment plans stretch 10 years. AIming to be student loan debt free by 30 is one of the best financial gifts you can give yourself. Paying off debt frees up money in your budget for new goals, helps your credit score, and saves you money in the long run, since you’re not paying interest anymore. Most importantly, you’ll decrease your stress levels. Prioritize paying off debt and enter your 30’s with a huge load off your shoulders.

Financial Burdens

  • Spend less on your credit cards. Credit cards are tempting because they offer rewards programs. Travel hacking, or cashing in points for holiday gifts are wonderful perks for spending. However, the truth is that credit cards lead to more overall spending. If you’re doing more spending than you can afford on your credit card, it doesn’t matter if it comes with all the perks in the world. By 30 you want to be debt free, not incurring more debt due to overspending on a credit card. Studies show that people who use debit cards or cash focus more on price and spend less overall. Resolve to move some of your spending from your credit card to a debit card to easily save yourself some money.
  • Don’t try to be a tax pro. Taxes are so hard that accountants and tax professionals literally have to go to school and take tests to become good at them. They have to get licensed. If you suck at taxes, it’s ok. You don’t need to be a tax genius to be a real adult. However, you should have a basic understanding of your tax situation by 30. You should understand basic tax terminology, or the tax implications of a Roth IRA vs a Traditional IRA. Know where all your money is, how much is there and what kind of funds you’ve invested in. You can find someone who is good at taxes to handle yours, but you need to be up to speed on your taxes and investments. You want to be able to stay afloat in the conversation you have with your tax pro.
  • Stop the comparison game. Your friends are all lovely people living lovely lives, but you are not them. You are the only one living your life. You’re the only one who knows the in’s and out’s of your finances, and what you’re capable of. There’s no need to compare yourself to others just to wind up feeling bad about yourself. For the most part, we have no idea how our friends manage money. Maybe that trip to Bali was on their parent’s dime, or maybe it was financed by credit cards. Don’t let what others are doing eat you up. You are living your own life, and that’s all that you need to focus on. Release the weight of comparison from your shoulders.

Thirty is a big deal. While you’re planning the best birthday party of your life, make a little time to plan for your finances as well. Getting your financial house in order leads to less stress. When you’re debt free, you don’t worry about being able to afford monthly payments. When you automate savings, you don’t worry about having a money buffer. You can focus your energy on the things you love, rather than obsess over things that worry you. Financial responsibility leads to financial zen.

Everyone’s situation is different, so tailor these recommendations to your own life. For even the most frantic among us though, these guidelines should help usher in financial wellness before you turn thirty.

So, are you with me?

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