MSN had a great article called 6 financial milestones before 30 that is worth mentioning. They suggest that by the age of 30 we should…
- Scale back on credit cards – Living the “excess” lifestyle should change as we mature.
- Own a home or have a plan to – Investing in your home is still a good idea – especially now.
- Have career skills developed – Have a marketable skill in case of job changes.
- Give money away – Establish a regular charitable giving plan.
- Know yourself – Figure out what your priorities and values are and stick to them.
- Know smart people – Knowing a good tax preparer, financial planner, attorney and insurance agent can save you untold amounts of money and stress.
What do you think? Are there other financial goals 20-somethings should be shooting for by the age of 30?
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I would think having a 3-6 month emergency fund established would have to be up there for milestones. Also I think they missed a very important one and that would be starting a Roth IRA or participating in whatever retirement plan their employer might offer.
I agree with Bob V. Get that emergency fund in place. $1,000 is a great starter emergency fund.
Another great goal would be to save up and pay cash for a large purchase. As we all know, 90 days same as cash isn’t really same as cash.
I think those 6 goals are good guidance, but I think it’s important to emphasise that each person needs to take the guidance and turn it into a concrete goal.
Instead of “buy a house in a couple of years” the goal should be “save a 20% deposit on a $250,000 house by 31st December 2010″.
As a 20-something with a mortgage, one of the big things I see in my peers that holds them back from making this same step is they haven’t clearly defined a timeframe and scope for each goal they want to achieve.
Um, yes! The list is missing:
- Save for retirement (hi, compound interest!)
- Get out of debt
- Establish an emergency fund
The younger you are when you get these things done, the better. Having a mortgage can wait.
Thanks for the points.. I have followed them since college and am quite financially stable during these turbulent times..
When we got married (in our early 20′s) we were encouraged to make a long term plan for our lives. Included in this was our finances. Things haven’t always followed that plan, but it’s good to at least go through the exercise and set out some long term goals.
In hindsight- something we TOTALLY wish we would have made a better plan for in our 20s was paying off Student Loans as fast as possible! So making a bit of life plan might include something like, “Doubling up student loan payments so I’m not still paying them when I turn 30.”
If you can’t give money to a charity, then volunteer. You help a cause, make friends and perhaps, learn a new skill.
Bob, I’m in the 20 something range and this is a great post for me.
I really like number 6. As they always say, surround yourself with people smarter than you.
I’m learning that now, I made a few business decisions without seeking advice and now I’m playing catch up because of that mistake.
So, since then I’ve finding people to add to my team to help lead me to success.
Thanks again.
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