How to save money in your 30s

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Reality sets in when you’re in your 30s.

You’re busy climbing the corporate ladder or exploring ways to expand your own startup business. Or, you’re considering whether you need to go back to school and pursue another career path.

You’re getting married, settling down and perhaps starting to form your own family. And now that your parents are getting older, you’re starting to consider whether there’s anything you need to do to support them.

Saving money might seem difficult, but it’s not impossible. If you take the right steps, you can knock out debt, grow your wealth and look forward to a bright future.

Here’s how to start saving money in your 30s.

1. Fix your budget

If you haven’t adjusted your budget since college, it probably needs a makeover. Chances are a lot has changed in your life since then. You no doubt have more responsibilities and bigger expenses, like a monthly mortgage payment and child care expenses. You can no longer blow $300 on a last-minute concert, and you have to think carefully before attending your friend’s destination wedding in Johannesburg. After all, you have bills to pay.

“Your budget will always be a reflection of your lifestyle at any point in your life,” says Ron Guay, founder of Rivermark Wealth Management.

To afford the necessities, you might have to make some sacrifices.

“For most people, it probably means less eating out, fewer concert tickets and more on things like housing and insurance,” Guay says. “It will be different for everyone, but you have to define your top priorities and remove expenditures that just aren’t as important as they used to be.”

Your new budget should make room for savings. You should plan to have a percentage of your take-home pay automatically go into a savings account for yourself, your child or an account earmarked for a particular goal.

2. Move past basic budgeting and set big goals

Your goals should go beyond meeting your short-term needs. If you’re a newlywed, you have joint financial decisions and goals to set. If you’re a parent, you have to set goals with your children in mind.

Set savings goals that reflect your long-term plans and priorities. Figure out what needs to be done in order to save for a bigger home or a big move to a city with a better quality of life. Write down what you intend to do specifically in order to turn your dreams into a reality, whether that’s creating a stricter budget or finally paying off your student loans so you can save more than 5 or 10 percent of every paycheck.

If you need support, you can always turn to a fee-only financial planner who can help you identify areas of improvement.

3. Grow your emergency fund

Perhaps you got away with barely saving for a rainy day in your 20s. But in your 30s, that’s just not going to cut it.

Anything could happen. Months after buying a new home, you could find a hole in your roof. And a year after you tie the knot, your spouse could come down with a serious illness.

Being financially prepared is key. Aim to have an adequate savings cushion that will allow you to cover your daily livings expenses for at least six months. In the best-case scenario, this is something you establish before you take on a mortgage or purchase a new car, Guay says. But if that’s not the case for your financial situation, you’ll need to make changes.

Guay recommends pinpointing expenses you can reduce or eliminate completely if they’re not necessary.

“It’s like looking in your closet and finding an outfit that you haven’t worn for over a year,” Guay says. “Does it still deserve a spot in there?”

Also consider the benefits of compound interest, especially when you’re saving in a high-yield account with interest that compounds on a daily basis. The sooner you get into the habit of saving, the better.

“The best advice I can give people in their 30s is to save early and save often,” says Charlotte Geletka, the managing partner of Silver Penny Financial and a registered representative of Lincoln Financial Advisors. “The compounding value of money is very powerful. For instance, if you start saving $100 month at age 30, by age 60 you could potentially have $149,000. If you wait 10 years until age 40, by age 60 you would have the sum of $58,902. (assuming an 8 percent return).”

4. Shop smart

Cutting back on certain expenses will only go so far if you’re overspending on other items like groceries or clothing. Luckily, there are dozens of ways to save money when shopping.

If you have kids, buying what you need for your household in bulk can be helpful. Consider comparison shopping in advance so that you’re visiting the store with the best deals. And time the purchase of certain items so that you’re purchasing them when they’re most likely to go on sale.

Other tips to consider include:

  • Plan ahead so you’re shopping for groceries that you can use to make multiple kinds of meals.
  • Chop up your own fruits and veggies instead of buying the pricier pre-cut varieties.
  • Check out thrift stores and consignment shops instead of hitting the mall.
  • Opt for the cheaper, off-brand items at the grocery store.
  • Use a cash-back credit card or another rewards card while you shop.

Geletka recommends limiting how much money you have at your disposal when you go shopping.

“I suggest giving yourself a specific shopping allowance each month. If you do not use your allotted funds, let them roll over to the next month to give yourself a larger shopping spree the next month,” Geletka says. “Also, having the perspective that overspending on one area takes away from something else. If you buy the expensive handbag or the new drone, what are you giving up down the road?”

5. Rethink higher education

If you’re stuck in a dead-end job or a career you’re not fond of, don’t think there isn’t a way out. You can always consider going back to school and earning another degree.

Another degree or a career switch could open many new doors and potentially increase your salary. Making more money doesn’t guarantee that you’ll save more, but it helps if you have certain goals you’re struggling to meet with your existing paycheck.

Just make sure you do your research, Geletka suggests, if you’re going back to school.

“There has to be a financial component in the decision making process,” Geletka says. “If you go back to college without a career trajectory, you could land yourself in substantial debt without the job prospects that you are looking for. Also consider night and executive programs so you can continue working while you pursue your future career.”

6. Open an investment account

There’s more than one way to invest. A good way to easily get started is to invest in your future by enrolling in your company’s retirement plan, Geletka says.

If you’re interested in investing in other kinds of vehicles, keep in mind that there’s no one-size-fits-all approach. Your investment options should depend on the kind of risk you would be most comfortable taking on.

Consider why you’re investing in the first place before you buy stocks or dip your toe into the bond market.

“Opening an account without a defined goal is like jumping in your car and driving with no idea where you are going. It’s the goal that drives all decisions that follow,” Guay says.

Something else to consider: You should walk before you run. In other words, it doesn’t make sense to invest money when you’re buried in credit card debt or you don’t even have a basic emergency savings account.

If you’re ready to start investing, read Bankrate’s brokerage reviews to find a broker that fits your needs.

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