30 Financial Milestones You Should Hit By Age 30
This checklist is a guide to help you develop a plan for your money in your
20’s, that will set you up for wealth and financial security in your 30’s — and
beyond!
These 30 milestones are a mix of short- and long-term objectives, but every
single one of them will have a BIG, lasting impact on your finances for the
rest of your life. Some of the items on the list you can accomplish right now,
others will take a few years to complete.
No matter where you’re starting, know that every single one is achievable
— and if you’re worried you won’t get them all checked off by age 30,
remember: your 35 year old self wants financial security, too, so there’s no
harm in extending the timeline!
1. Financially independent of your parents. Parents always want to help but
eventually their doting will become a hinderance when it comes to establishing yourself
as a self-sufficient adult. I’m a firm advocate that you should establish complete
financial independence of your parents in your early twenties, but if an unexpected
emergency or crippling debt threw you back in the nest for a few years, make sure you
claw your way out by 30.
2. Consumer & Student Loan Debt Free. There’s no excuses to carry the
spending mistakes of your youth into your 30’s, so your consumer debt should be long
gone. Depending on what and how long you studied in university, your student loans
should also be vanquished by age 30. If they’re not, make sure they are at their
minimum.
3. Out of overdraft. Sometimes your checking account runs dry when you’re
trying to make ends meet, but by age 30 you’ve had a bank account long enough to
know how to stay out of the red. If overdraft is a habit for you, it’s one you need to break
by 30.
4. Good credit history. Maybe you missed some payments and even had a
debt go to collections when you were young and foolish, but by 30 you should have
redeemed yourself from these mistakes. A solid credit history will help you with big
purchases like a home, but also shows you pay your bills on time and don’t live at the
limit of your cards.
5. Have 10,000+ saved for retirement. If that number made your eyes bulge
out, you better get saving. As a general rule, I think you should aim to have one-year’s
worth of your salary banked for retirement by age 30, but if your spent a long time in
university or had a slow start to your career, this may not be possible. $25,000 is a good
amount to aim for if you need to set a target. Even if you don’t start saving until age 25,
you’ll only need to put $5,000 per year away to meet this goal.
6. Started an investment portfolio. Whether it’s something simple like mutual
funds or more advanced like stocks, by age 30 you have to have your money diversified
in something beyond a basic savings account. This is one of the most important
financial milestones, because it’s the engine behind steady, long term wealth building.
7. Established an emergency fund. There are mixed opinions about just how
much you should have set aside in case trouble comes your way, but the general rule is enough to cover 3-6 months of essential expenses.
8. Properly insured. Part of being a responsible adult is protecting yourself,
and that includes small things like tenant insurance for your apartment right up to
disability insurance. If you don’t have coverage through an employer, you should also
look for health/dental insurance to manage those costs.
9. Maximizing employer benefits. If you’re lucky enough to work somewhere
that provides you with perks, you should know what they are and be using them — it’s
free money! Make sure you opt in to things like employer retirement plans and utilize
spending accounts for learning & development. Don’t let these things go to waste!
10. In the habit of tracking your spending. It’s a tedious chore but the only
way you’re ever going to manage your money is if you know where it’s going. By 30 you should be in the habit of tracking purchases and making sure you’re spending less than you earn.
11. Done with impulse purchases. The sooner you give up the habit of
shopping when bored or grabbing goodies while you wait in the grocery store checkout, the better. Going into your 30’s, you understand your money can only work for you when you have it, so you’ve gotta stop spending it on things you didn’t originally want or need.
12. Willing to spend where it counts. As you near 30, your dorm-room living
days are probably long over and you’re ready to invest in some nice furniture or pots
and pans that aren’t coming second-secondhand (thirdhand?). Whether its your
wardrobe, your home, or even items like a gym membership, you understand that
sometimes quality costs and you’re willing to spend where it matters.
13. In the habit of regularly checking your credit report. You can do this
once a year and for FREE, and it’s one of the simplest ways to protect yourself against
identity theft while maintaining good financial health. You have no excuses not to!
14. On top of all your monthly bills. In your disorganized youth, you
probably forgot to pay a bill or missed a deadline, but by 30 you should be well into the habit of meeting all your deadlines. Set up an auto-pay from your checking account to ensure you never miss a due date!
15. At least one big splurge you saved up for and paid in full with cash.
Whether it’s an extensive backpacking adventure or a new car, you should have at least one “fun” financial triumph behind you by the time you hit 30. Save up and spend! You have to enjoy your money as you take care of it!
16. An understanding of personal income taxes and how to minimize
what you pay. Understanding what tax bracket you fall into and what credits are
available to you means more money in your pocket every year.
17. Diligently saving for a big purchase. Whether it’s a wedding or a downpayment
on your home, there might be something very expensive coming up that takes
a few years of planning. By 30 you should not only have a plan, but actively making
headway towards your goal.
18. A clear direction of your career. Your job is your major financial asset,
and the one that generates the most income for you. By 30, not only should you know
what industry you work in, you should have logged a few years of professional
experience in your field. If you were in school pursuing a graduate or professional
degree, this might not be many years, but the most important thing is that you’ve started establishing yourself to reap the rewards of hard work in your 30’s and 40’s.
19. A profitable side income. However small, having a second (or third, or
fourth) revenue stream is important. This can be a small part-time endeavour or
something as simple as dividend payments from stocks you own. In any case, you
should have an alternative source of income beyond your main employment.
20. A positive, growing net worth. By 30, it should be true that your assets –
liabilities = positive number. This might be a challenge depending on how much debt
you took on for school or how foolish you were in your early 20’s, but ultimately your net worth should be growing at a quick clip as you enter your 30’s.
21. A BHAG for your finances. BHAG stands for “Big Hairy Audacious Goal”.
This can be something like retiring with $2 million or purchasing a vacation property by
age 40 or earning a salary of $100,000 per year. Whatever it is you want, make sure it’s
BIG and challenging so you can work towards it a little bit every year. When you meet
your goal, make another.
22. An understanding and a plan of how your money will deliver the
lifestyle you want. Millennials dream big — sometimes a little TOO big! If you’re
planning to pay off all your debts, get married, buy a home, have a child, get a
promotion, buy a new car, and save $50,000 for retirement by age 30, you might need a reality check. Take a critical and realistic look at your stupid goals and determine if they really are feasible. Maybe make adjustments by lowering the target or extending the deadline. Remember, it’s not a race!
23. So over measuring your finances against that of your friends. By age
30, some of your peers will have enjoyed tremendous success in their careers, and
others will be struggling. At 21 there was little predict who would end up where, but by
now the cards have been dealt and maybe you didn’t end up a millionaire by 25. While it can be hard to quell jealousy when someone is enjoying more financial success than you, your situation is yours and you have to manage it best you can. It’s time to get over this, bury the green-eyed monster, and move on.
24. Less consumption-oriented. It’s easy to be dazzled by bright & shiny
things in your 20’s, but heading into your thirties you understand that a new car or a big home are just things and ultimately don’t matter — and certainly are no testament to your financial health or success!
25. A healthy relationship with credit cards. By age 30 you should only be
using credit cards for the conveniences and reward perks. You should always pay the
bill in full and never miss a due date. You understand that creditors want to make money off of you, not provide you with benefits, so you pursue all rewards cards with caution.
26. A regular contribution to charity. Whether you drop $10-$20 monthly or
a few hundred dollars a year to one or many charities, giving is an integral part of
personal finance. Find a cause you believe in and do your part to help it succeed. This
necessitates not only budgeting, but also serves as a reminder that many are not as
fortunate as you and we have a moral obligation to help our communities by sharing our wealth.
27. If you’re part of a couple, a healthy way of sharing money with your
partner. Whether it’s splitting bills 50/50 or one paying certain bills and the other person
paying the rest, by your 30’s you should have figured out a system that works for both of you. Disagreements about finances are a leading cause of divorce, so getting over this early ensures a healthy wallet and a happy relationship.
28. A commitment to putting free or cheap before convenient. Whether it’s
brewing coffee at home or looking for furniture secondhand, it will always be easier to
buy new, but it’s in the best interest of your wallet (and the environment!) to seek out
alternative ways to get what you want or need without spending much or anything at all. Make use of sites like eBay, Craigslist, and Kijiji or develop your own resources (ie. clothing swaps) and check out used bookstores, consignment shops, and thrift stores.
29. Done paying unnecessary fees. In your 20’s it seems insignificant to
withdraw cash from an ATM that is not from your bank and it’s a hassle to call your
cable or cellphone provider for a cheaper plan, but if you do these things and are
strapped for cash, it’s completely your fault. It may have been forgivable to be careless
in your 20’s, but going forward you never want to be paying more than you have to!
30. An understanding and appreciation for the reality that money is only
a tool of exchange, and not worth obsessing over. It’s cool to be financially savvy,
but don’t let it take over your life. By getting your ducks in a row in you’re 20’s, you’ll be
all set to enjoy the financial fruits of your labor in your 30’s and beyond.
20’s, that will set you up for wealth and financial security in your 30’s — and
beyond!
These 30 milestones are a mix of short- and long-term objectives, but every
single one of them will have a BIG, lasting impact on your finances for the
rest of your life. Some of the items on the list you can accomplish right now,
others will take a few years to complete.
No matter where you’re starting, know that every single one is achievable
— and if you’re worried you won’t get them all checked off by age 30,
remember: your 35 year old self wants financial security, too, so there’s no
harm in extending the timeline!
1. Financially independent of your parents. Parents always want to help but
eventually their doting will become a hinderance when it comes to establishing yourself
as a self-sufficient adult. I’m a firm advocate that you should establish complete
financial independence of your parents in your early twenties, but if an unexpected
emergency or crippling debt threw you back in the nest for a few years, make sure you
claw your way out by 30.
2. Consumer & Student Loan Debt Free. There’s no excuses to carry the
spending mistakes of your youth into your 30’s, so your consumer debt should be long
gone. Depending on what and how long you studied in university, your student loans
should also be vanquished by age 30. If they’re not, make sure they are at their
minimum.
3. Out of overdraft. Sometimes your checking account runs dry when you’re
trying to make ends meet, but by age 30 you’ve had a bank account long enough to
know how to stay out of the red. If overdraft is a habit for you, it’s one you need to break
by 30.
4. Good credit history. Maybe you missed some payments and even had a
debt go to collections when you were young and foolish, but by 30 you should have
redeemed yourself from these mistakes. A solid credit history will help you with big
purchases like a home, but also shows you pay your bills on time and don’t live at the
limit of your cards.
5. Have 10,000+ saved for retirement. If that number made your eyes bulge
out, you better get saving. As a general rule, I think you should aim to have one-year’s
worth of your salary banked for retirement by age 30, but if your spent a long time in
university or had a slow start to your career, this may not be possible. $25,000 is a good
amount to aim for if you need to set a target. Even if you don’t start saving until age 25,
you’ll only need to put $5,000 per year away to meet this goal.
6. Started an investment portfolio. Whether it’s something simple like mutual
funds or more advanced like stocks, by age 30 you have to have your money diversified
in something beyond a basic savings account. This is one of the most important
financial milestones, because it’s the engine behind steady, long term wealth building.
7. Established an emergency fund. There are mixed opinions about just how
much you should have set aside in case trouble comes your way, but the general rule is enough to cover 3-6 months of essential expenses.
8. Properly insured. Part of being a responsible adult is protecting yourself,
and that includes small things like tenant insurance for your apartment right up to
disability insurance. If you don’t have coverage through an employer, you should also
look for health/dental insurance to manage those costs.
9. Maximizing employer benefits. If you’re lucky enough to work somewhere
that provides you with perks, you should know what they are and be using them — it’s
free money! Make sure you opt in to things like employer retirement plans and utilize
spending accounts for learning & development. Don’t let these things go to waste!
10. In the habit of tracking your spending. It’s a tedious chore but the only
way you’re ever going to manage your money is if you know where it’s going. By 30 you should be in the habit of tracking purchases and making sure you’re spending less than you earn.
11. Done with impulse purchases. The sooner you give up the habit of
shopping when bored or grabbing goodies while you wait in the grocery store checkout, the better. Going into your 30’s, you understand your money can only work for you when you have it, so you’ve gotta stop spending it on things you didn’t originally want or need.
12. Willing to spend where it counts. As you near 30, your dorm-room living
days are probably long over and you’re ready to invest in some nice furniture or pots
and pans that aren’t coming second-secondhand (thirdhand?). Whether its your
wardrobe, your home, or even items like a gym membership, you understand that
sometimes quality costs and you’re willing to spend where it matters.
13. In the habit of regularly checking your credit report. You can do this
once a year and for FREE, and it’s one of the simplest ways to protect yourself against
identity theft while maintaining good financial health. You have no excuses not to!
14. On top of all your monthly bills. In your disorganized youth, you
probably forgot to pay a bill or missed a deadline, but by 30 you should be well into the habit of meeting all your deadlines. Set up an auto-pay from your checking account to ensure you never miss a due date!
15. At least one big splurge you saved up for and paid in full with cash.
Whether it’s an extensive backpacking adventure or a new car, you should have at least one “fun” financial triumph behind you by the time you hit 30. Save up and spend! You have to enjoy your money as you take care of it!
16. An understanding of personal income taxes and how to minimize
what you pay. Understanding what tax bracket you fall into and what credits are
available to you means more money in your pocket every year.
17. Diligently saving for a big purchase. Whether it’s a wedding or a downpayment
on your home, there might be something very expensive coming up that takes
a few years of planning. By 30 you should not only have a plan, but actively making
headway towards your goal.
18. A clear direction of your career. Your job is your major financial asset,
and the one that generates the most income for you. By 30, not only should you know
what industry you work in, you should have logged a few years of professional
experience in your field. If you were in school pursuing a graduate or professional
degree, this might not be many years, but the most important thing is that you’ve started establishing yourself to reap the rewards of hard work in your 30’s and 40’s.
19. A profitable side income. However small, having a second (or third, or
fourth) revenue stream is important. This can be a small part-time endeavour or
something as simple as dividend payments from stocks you own. In any case, you
should have an alternative source of income beyond your main employment.
20. A positive, growing net worth. By 30, it should be true that your assets –
liabilities = positive number. This might be a challenge depending on how much debt
you took on for school or how foolish you were in your early 20’s, but ultimately your net worth should be growing at a quick clip as you enter your 30’s.
21. A BHAG for your finances. BHAG stands for “Big Hairy Audacious Goal”.
This can be something like retiring with $2 million or purchasing a vacation property by
age 40 or earning a salary of $100,000 per year. Whatever it is you want, make sure it’s
BIG and challenging so you can work towards it a little bit every year. When you meet
your goal, make another.
22. An understanding and a plan of how your money will deliver the
lifestyle you want. Millennials dream big — sometimes a little TOO big! If you’re
planning to pay off all your debts, get married, buy a home, have a child, get a
promotion, buy a new car, and save $50,000 for retirement by age 30, you might need a reality check. Take a critical and realistic look at your stupid goals and determine if they really are feasible. Maybe make adjustments by lowering the target or extending the deadline. Remember, it’s not a race!
23. So over measuring your finances against that of your friends. By age
30, some of your peers will have enjoyed tremendous success in their careers, and
others will be struggling. At 21 there was little predict who would end up where, but by
now the cards have been dealt and maybe you didn’t end up a millionaire by 25. While it can be hard to quell jealousy when someone is enjoying more financial success than you, your situation is yours and you have to manage it best you can. It’s time to get over this, bury the green-eyed monster, and move on.
24. Less consumption-oriented. It’s easy to be dazzled by bright & shiny
things in your 20’s, but heading into your thirties you understand that a new car or a big home are just things and ultimately don’t matter — and certainly are no testament to your financial health or success!
25. A healthy relationship with credit cards. By age 30 you should only be
using credit cards for the conveniences and reward perks. You should always pay the
bill in full and never miss a due date. You understand that creditors want to make money off of you, not provide you with benefits, so you pursue all rewards cards with caution.
26. A regular contribution to charity. Whether you drop $10-$20 monthly or
a few hundred dollars a year to one or many charities, giving is an integral part of
personal finance. Find a cause you believe in and do your part to help it succeed. This
necessitates not only budgeting, but also serves as a reminder that many are not as
fortunate as you and we have a moral obligation to help our communities by sharing our wealth.
27. If you’re part of a couple, a healthy way of sharing money with your
partner. Whether it’s splitting bills 50/50 or one paying certain bills and the other person
paying the rest, by your 30’s you should have figured out a system that works for both of you. Disagreements about finances are a leading cause of divorce, so getting over this early ensures a healthy wallet and a happy relationship.
28. A commitment to putting free or cheap before convenient. Whether it’s
brewing coffee at home or looking for furniture secondhand, it will always be easier to
buy new, but it’s in the best interest of your wallet (and the environment!) to seek out
alternative ways to get what you want or need without spending much or anything at all. Make use of sites like eBay, Craigslist, and Kijiji or develop your own resources (ie. clothing swaps) and check out used bookstores, consignment shops, and thrift stores.
29. Done paying unnecessary fees. In your 20’s it seems insignificant to
withdraw cash from an ATM that is not from your bank and it’s a hassle to call your
cable or cellphone provider for a cheaper plan, but if you do these things and are
strapped for cash, it’s completely your fault. It may have been forgivable to be careless
in your 20’s, but going forward you never want to be paying more than you have to!
30. An understanding and appreciation for the reality that money is only
a tool of exchange, and not worth obsessing over. It’s cool to be financially savvy,
but don’t let it take over your life. By getting your ducks in a row in you’re 20’s, you’ll be
all set to enjoy the financial fruits of your labor in your 30’s and beyond.
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