Learn the financial skills you should have by 31? Here are eight skills you need for your financial future.
Okay, so you’re approaching age 30, and you’re wondering, “Have I learned everything I should know about money?” Here are eight important financial lessons to take into your 30s:
Make a plan. You won’t reach a better financial situation by living paycheck to paycheck. By 31, make sure you’re using your collected financial skills and perseverance to create and stick to a budget.
Build an emergency fund. The unexpected car repair will always hit you when you’re not ready. Work toward an emergency fund that can cover three months of living expenses, so you can handle job losses and repairs without being buried by debt.
Invest in your ability to make more money. Your income is your greatest asset, so continually invest in your own professional development. A good rule-of-thumb is to reinvest two percent of your annual income in professional development such as books, seminars, and certifications.
Calculate your career advancement. Working your way up in your career is the best way to grow your income. Continually work to understand changes in your field and look for higher-paying positions to maximize your income potential. Take career risks and refine your goals.
Dump debt. When you take on debt, you need to make sure you can repay it. Keep your monthly debt payments (including rent or mortgage) under 35 percent of your monthly income.
Talk about money openly. Getting engaged or married? Talking about money with your significant other is important. Get on the same page about money EARLY and continually talk about finances.
Start saving for retirement a.s.a.p. Retirement seems so far away, but saving for retirement now will help you increase your long-term savings through compound interest.
It is okay to say “No”. Save up for life’s pleasures then say “Yes” when you have the money in the bank. You will enjoy your trip more knowing you already have the money, I promise.