You are never too young or too old to learn financial lessons. Everybody can benefit from a little bit of financial advice, regardless of their age. Here are 10 financial lessons to learn, no matter how old you are!
20s: Prepare for Financial Emergencies
Financial emergencies will happen when you least expect it. That is why it is important to have money on hand for when they occur. It is recommended to have three to six months of money for expenses. It is not easy to get that kind of dough together quickly, so it is important to start saving when you are younger.
20s: Start Investing in Retirement
It is best to start saving for retirement in your 20s. Just because you are not even close to retirement doesn’t mean you can’t start saving now. If your office has a 401(k) program, start investing in it today. Then if you have the means to do so, also invest in an IRA. Both are good options to have the maximum amount of money you will need to retire in your 60s or later.
20s: Use Credit Cards Wisely
It’s good to build credit, but it is bad to use credit cards for more than you can afford. If you use your credit cards for more than the cash flow you have, you will be in big trouble. It might seem like it’s not money you are using, but in the end, you will have to pay more due to credit card interest. A good rule of thumb is that if you don’t have the money to pay off the balance in full, then don’t use your credit card for it.
30s: Having More Money Doesn’t Mean You Need To Spend It All
Just because you have more money doesn’t necessarily mean that you need to spend it. Your lifestyle can change a little bit when you have more money, but be careful that you don’t overspend! You can easily fall into the trap of “lifestyle creep,” which is when you make more money so you inflate the amount you spend on certain items. You don’t want lifestyle creep. Make sure you spend within your means.
30s: Don’t Wait To Save for Your Kid’s College
When your kids are young is the perfect time to start thinking about saving for college. The idea is to save for them so you can financially help them out when they go away to school. This also means they will have less student loan debt. Start saving now so you can help them out in the future.
30s: Pay Down Debt To Improve Your Financial Stability
Having financial debt is a burden, but if you have more money, then you can start paying off more of your debt. Once your debt has gone bye-bye, then you can spend your money on things you want to spend it on. Paying off your credit card debt might seem helpless, but just know that if you only use it with amounts you can pay off, you will be in better financial standing.
40s: Keep Increasing Your Income
If you can, keep increasing your income! You can do this by asking for a raise or switching jobs to one that pays more than the one you have. These are simple and easy ways to increase your income, just in case you have any unexpected expenses that come about.
40s: Work With a Financial Planner
It’s okay to need a little bit of financial guidance! Hiring a financial planner can help you make sure that you are not drowning in some of the big-ticket items you purchase. Financial planners can help you with changes in your life and can also help you plan for different events that may occur.
Read More: 15 Tips for Financial Planning in Your 30s
50s: Catch-Up Contributions Can Help You Out
Catch-up contributions are the perfect way to add money to your retirement savings. They allow you to put away more money each year so you can withdraw more money from your IRA. This means more money when you retire!
Read More: 20 Tips for Early Retirement
50s: Don’t Wait — Think About Retirement Medical Care Today
It is important to not forget that when you retire, you will also have health costs. If you wait until a medical emergency happens when you retire, it might be too late. It is a good idea to make sure you have the money for your medical bills before your last day of work.
Read More: 10 Signs You Need to Rethink Your Finance Goals
