Your 30s can feel like a financial balancing act. You may be paying down debt, building a family, changing jobs, caring for others or simply trying to enjoy life while thinking about what comes next.
Juggling so many responsibilities makes it hard to know what to prioritize or whether you’re on the right track at all. This guide can help you decide which savings goals may need your attention before your 30s are over.
Get your debt organized
Debt and savings may not seem like they belong in the same article. However, the two can be closely related — especially if your debt payments are a large part of your monthly budget.
Getting debt payments organized can help you see where your money is going and how much room you may have for future savings goals. Consider listing your debts, remaining balances, interest rates and minimum payments, and then start looking for a payoff strategy. You might explore whether a debt consolidation loan could help you combine eligible debts into one monthly payment, potentially with a lower interest rate.
Once you have a clearer plan for your debt, saving for the next goal on your list may feel easier.
Start an emergency fund
By the time you’re in your 30s, you may have experienced a few unpleasant financial surprises, like car repairs or a sudden change in income. An emergency fund gives you a way to cover those costs without immediately turning to credit or disrupting your long-term goals.
People often suggest keeping about three to six months of living expenses in an emergency fund. That’s a great goal, but there’s nothing wrong with aiming for a smaller amount first, such as $500 or $1,000.
One way to get started is by setting up an automatic transfer each payday. Moving just $5 or $10 per paycheck can make a difference over time. Every deposit prepares you to handle unexpected expenses and keeps you moving toward your goal.
Save for retirement
Retirement can feel far away when you’re busy taking care of your current expenses. But putting something aside now gives your money time to grow and helps you avoid playing catch-up later on.
If your employer offers a retirement plan, contribute what you can now and consider increasing your contribution as your income rises. And find out if your employer offers a match. Contributing enough to access it may help your retirement savings grow faster.
Another option is to invest in an individual retirement account (IRA). An IRA lets you set aside money for retirement on your own.
Prepare for health care costs
While you’re saving for retirement, you might also want to put a little extra away for health care and insurance. Many people retire before they’re eligible for Medicare, leaving them covering health costs on their own for a few years. And even when they do become eligible for Medicare, it doesn’t necessarily cover all your medical needs.
One way to set aside money is by opting for a high-deductible health plan (HDHP) that’s eligible for a health savings account (HSA). Money contributed to an HSA:
· May lower your tax bill. Contributions may reduce your taxable income for the year.
· Grows tax-free. Interest or investment earnings in the account aren’t taxed.
· Can be used tax-free. You can use HSA funds for qualified medical expenses like doctor visits, prescriptions and some dental or vision costs.
HSAs have annual contribution limits, but there generally isn’t a limit on how much you can keep in the account, and you don’t forfeit the funds at the end of the year. Any unused funds can stay in the account, where they may continue to grow for future qualified medical expenses.
Plan for major milestones
A lot can happen in your 30s. You might get married and start a family. You could also decide to buy a house, go back to school, move to a new city, start fertility treatments, open a business or support someone you love.
Planning for those events — even if you’re not exactly sure which ones are ahead — can help you fit them in your budget if they arrive. Start by choosing one or two possibilities, estimating their costs and deciding how much you want to save toward them each month.
For a larger planned expense, borrowing could supplement your savings if the payments fit your budget. Using a personal loan calculator can help you estimate how different loan amounts, interest rates and repayment terms may affect your monthly payment.
Save for the life you want
Saving doesn’t have to be limited to emergencies, retirement and major life changes. You can also set money aside for the experiences and personal goals that matter to you, whether that means visiting family more often, starting a hobby or creating a small fund for fun.
Start by choosing one personal goal, giving it a clear name and setting a small monthly savings target. Keep that money separate from your emergency fund, perhaps by opening another account or dividing your current account into categories.
Give your future self more options
When it comes to your financial well-being, your 30s can be an important decade. Taking the time to identify your savings goals helps create more choices in the years ahead. Whether you start with an emergency fund or one personal goal that matters to you, every step you take helps prepare you for what comes next.
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Our Editorial Team are writers and experts in their field. Their views and opinions may not always be the views of Wellbeing Magazine. If you are under the direction of medical supervision please speak to your doctor or therapist before following the advice and recommendations in these articles.
