To help you get on track, here's what you ideally should have achieved by age 30. Of course, these goals aren't for everyone and may not be feasible for many, so try to keep them in mind as general guidelines.
- You should already have an emergency fund. Experts generally recommend six months' worth of living expenses, but some say a year's worth is a better buffer to account for things like medical emergencies or unemployment.
- You should be anticipating, preparing, and saving up for big expenditures. For example, you should factor in your wedding, a house, children, a pet, and other similar major expenses. By planning for these events, you'll be adjusting your lifestyle to afford your future expenses and avoid going into debt for these items. You may want to budget a realistic amount so you don't have to go into debt. Another thought is to forgo some of these expenses — really question if it's a necessity.
- You should have mastered the art of automating. Sending a chunk of your cash automatically to your savings every month means you're paying yourself first.
- You should know how to live within your means but enjoy life at the same time. You should be able to prioritize what's worth spending on and save in other areas so you can enjoy your guilty pleasures. Even if it's daily lattes, you should indulge yourself as long as you're aggressively cutting costs on other items. Remember, what other people skimp on may not be what you would want to give up.
- You should be maxing out (or, at the very least, meeting your employer's match for) your 401k.
- You should be investing in a Roth IRA.
- You should have prepared a will.
- You should be paying off and prioritizing your high-interest debt.
- During your 20s, you should be trying to raise your credit score.
- You should already have some practice with negotiation — with salary, with service providers, and more.
- Fidelity recommends having a retirement fund that's equivalent to your annual salary by age 35. At age 30, you should be on track for that.
- You should already have read a couple of personal finance books. To start with, check out Your Money or Your Life ($9) and Total Money Makeover ($15).
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