Your thirties are a time in most people’s lives where they are starting to get totally settled into careers, things probably seem pretty stable financially, and you have children most likely. This is a time when you are starting to breathe a sigh of relief from setting yourself up in life to settling in.
In your sigh of relief, you may be making it easy to make some big financial mistakes that could really cause problems down the road. It may be that you have more money than bills finally, or it could be that you are just getting promoted at work after years of hard work and schooling, but buckling down now that you have the money to do so is still very important.
Let’s look at some financial mistakes you should be avoiding in your 30’s.
- You assume retirement is far enough away you don’t have to worry about it. This is one of the biggest mistakes you should avoid. While it is true that people are retiring later and later in life, it doesn’t mean you should not plan for it. Even putting away a small amount can add up over a long period for your retirement.
- You have very little or no life insurance. While many employers provide life insurance, you must know the terms of it (can you pull it out if you are alive? Does it cover non-work-related death?) and if it is enough to cover not only your final expenses but leave something behind. Purchasing life insurance is good at this age because it is generally lower than if you wait until age makes you have more health complications. Also, make sure both you and your spouse are covered, especially if you have children. In the event of a divorce, it is also good to get a term life insurance policy on the other parent even if you get child maintenance.
- Not having a will. You may still feel invincible in your thirties, especially if you have no health issues, but it is still essential to make a will out. If something happened to you or your spouse, it could be a hairy situation financially if no will was made out.
- You assume your RRSP (Registered Retirement Savings Plan) or Pension will be enough. In most cases, it isn’t. You must take an honest look at it and decide if you need to contribute more to a separate fund for your retirement. It would help if you also were tracking it closely.
- You are not paying off your debt. You may assume you have many more years to work, so you pay minimum payments on debts such as your mortgage. Try to find ways to pay off more so you can get it paid off faster. The quicker you do this, the better off you will be financially in the future.
- You are living beyond your means. Being in a position of being more comfortable with your finances, you may be tempted to take on more debt or n9ot live within your means. This can cause you to live paycheck to paycheck and lots of issues down the road since you are assuming you will always be OK and have plenty of time to pay things off. Start living simply now before you find yourself in a world of debt.