Turning 30 is a significant milestone for most people. After the carefree early 20s where you finish college and get your first job, to mid-20s where you start taking life a little seriously, you approach this milestone with a more mature head. A spouse or even a child might be part of your life, which means more responsibilities too.
This also means you need to start thinking about how to use your money to ensure you can achieve what you want and have a good future. If you have already on that journey, it’s great. But if you haven’t, even then you don’t need to worry, it is never too late. The key is to make a beginning.
Here are a few things you should start doing before you get into your 30s
1) Start Investing for long-term goals
By the time you are about to touch 30, you are mostly working for a few years, and have a decent salary. You might be even saving some, keeping them in low return yielding FDs and RDs.
But saving is not equal to investing. If you want to make sure you can achieve your goals – be it buying a home, a good retirement, getting your dream car, or just getting rich, you need to start putting money where it gets a chance of high growth.
Equity Mutual Funds are one of the best avenues to achieve this. You can start a monthly SIP, and money will get invested automatically every month. SIP not only helps bring investing discipline plus ensures you can start small, test waters, and then increase the amount.
While you might have a lot of goals and not enough money to save, the key is to prioritize. One goal that you shouldn’t delay start saving for, though is retirement. Most of the time, it gets ignored as a car or your own house is more tempting. But if you don’t begin now, building a corpus for a comfortable retirement might get complicated.
You can see top Equity mutual funds here.
2) Make Yourself Debt Free
The debt we are talking about is one that might have taken to fund your lifestyle. It could be a personal loan you took for a vacation or credit card EMI you are paying for your fancy phone.
Not only these types of loans super expensive, what you are buying reduces in value, so it’s a double whammy. On the other hand, a home loan is ok as you have purchased an asset that will appreciate, and this appreciation can cover the interest costs.
So, even before you begin investing, you should make sure the loans have been repaid in full.
3) Get a Good Term Insurance Policy
Insurance is one aspect that most people tend to forget or do not give much importance to. Term insurance policy is essential to secure your dependent family members from any financial turmoil that may arise in case of your sudden demise.
Buying it before you hit your 30s would mean paying a much lesser premium and extensive coverage benefits. You can get an Rs.1 crore coverage for as low as Rs 8,608 (yearly). Moreover, the premium that you pay helps you save tax under Section 80 C.
You can read more about term insurance here.
4) Buy a Health Insurance Policy
Rising medical costs mean one emergency can wipe-off all your savings. Although your employer might be providing a corporate health cover, it might not be enough. You can read the reasons for it here.
So, get a personal health insurance policy as well, and if you have dependents, buy a policy that covers everyone.
The premium is typically nominal when you are less than 30 years of age, and you can get comprehensive coverage. Plus, the premium would also help you save taxes under Section 80 D.
5) Build an Emergency Fund
We all know life is unpredictable, and having an emergency fund makes sure you can handle the uncertainties with ease.
An emergency fund helps you deal with contingencies, say losing your job. To make sure you have enough money to deal with these unpleasant situations, build a corpus that can cover 6-9 month’s expenses (including EMIs).
Also, do make sure that you do not touch your emergency funds for any other financial requirements. Therefore, it is best not to keep them in your bank account.
You can read more about how to go about building an emergency fund and where you should keep them here.
Bottomline
It is easy to get overwhelmed while figuring out how to best manage your money. After all, we are not taught this anywhere – neither is school or college or at our workplace. But you can’t ignore this if you want to succeed in life.
And there is a solution that makes it all super easy. ETMONEY has been built to take the stress out of money management. So download it now and see how you can manage and grow your money effortlessly.
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