Who doesn’t love bucket lists? They’re a fun way to narrow down what’s most important to you and set a deadline to accomplish those goals. If you’re nearing 30, you may be considering creating a ‘Before 30′ bucket list of all the things you want to do before you reach a new decade.
I’d’ highly recommend creating a bucket list for the financial goals you want to achieve before you turn 30 as well. Your 30s should be a turning point for your finances. It’s the best time to make plans for your future and determine how money will help you reach your goals.
While your 20s are often a time of financial sacrifice it’s the best time to improve your finances so you can start to thrive in your 30s. Here are 7 financial bucket list items to achieve before 30.
1. Learn to Live Well Below Your Means
One of the most crucial concepts to learn before 30 is the importance of living below your means. You should always spend less than you make. If you spend exactly what you earn each month, money will be tight if and when unexpected expenses pop up.
Plus, spending more than you earn will often lead you into debt. It’s important to be realistic about the lifestyle you can have and commit to living below your means.
That way, you’ll always have leftover money to cover last-minute costs or simply to save. Living below your means doesn’t mean you have to be deprived or penny pinch. You can still splurge and do things you love but the key is to get on a realistic budget so you know how much you have to work with.
2. Pay Off All Your Debt
Debt can be a huge burden and eat up a ton of your disposable income. The interest rate on your student loans, credit cards, and car loans can be high and add up the longer you keep the account open.
That’s why it’s best to pay off all consumer debt ASAP. If possible, strive to have no debt outside of a mortgage once you hit your 30s. You’ll be able to do so much more financially as a result.
When you think about it, the average car loan payment is $400 to $500 per month while the average household has $6,000+ of credit card debt. When it comes to student loans, borrowers are taking 10 – 20 years or more to pay off their debt.
Having so much debt can slow down the process to hit other financial goals. For example, some people hold off on having kids or getting married due to debt. Don’t let debt hold you back especially in your 30s. Create a plan on how to get out of debt once and for all. Make the extra sacrifices now to cut back and make the necessary sacrifices to become debt free.
3. Save 10% or More Of Your Income
If you don’t have any savings lined up yet, set that as your next priority after getting out of debt. Ideally, you should have an emergency fund to cover at least 3 months of expenses. Plus, you may want to set aside some money in sinking funds to help cover specific costs like annual fees, medical bills, car repairs, holiday, etc.
Lack of savings will eventually lead to more debt because you won’t have any alternatives to borrowing money when you face a tight situation.
To avoid this, start setting aside 10% or more of your income to build up your savings until you feel like you have a comfortable amount. Make it automatic by setting up recurring transfers for your balance can grow over time.
4. Organize All Your Bills and Household Expenses
Are your household expenses a hot mess? You don’t want to enter your 30s not knowing what’s going on with your finances and weekly cash flow.
Get organized by determining which budgeting strategy works best for you and how you will track expenses. Are you a spreadsheet person? Do you like to write things down? Whether it’s an app, spreadsheet, or printable worksheets, decide which method you want to use to organize your finances and track your expenses.
Keep track of your due dates for bills including annual and semi-annual bills so you don’t get surprised. Sit down with your partner or spouse and have regular finance dates to discuss goals and stay organized.
5. Learn How to Use Credit Cards Wisely
Credit cards can be very powerful tools when used correctly. You can earn rewards and cash backs with certain credit cards. Plus, having a high credit score means you can get lower interest rates on big purchases like a mortgage, for example.
Credit cards shouldn’t be used as free money. They should be used only to earn rewards and boost or maintain your score.
If you’ve struggled with controlling your spending and managing credit cards in the past, you can add this item to your before 30 bucket list.
Sign up for just one solid credit card and practice keeping your utilization below 30% of your total credit limit and paying off the balance in full.
6. Find a Financial Accountability Partner
We all need accountability and friends who understand what it’s like to be on a financial journey. It can be challenging to find people who seriously are interested in improving their finances when you’re in your 20s but it’s not impossible.
Add this fun bucket list item to your list and try to join Meetups or simply explore your neighborhood in search of new friends who are financially savvy and share some of your aspirations to become better with money.
You can even create a small support group of accountability partners so you all can support each other’s financial goals, vent, and share new strategies.
7. Start Investing In Your Retirement
This is one of the most important items that should make it on your before 30 bucket list. By the time you reach 30, you’ll want to have a clear idea of when you’d like to retire and how much you need to set aside.
You should also be actively contributing to a retirement account. You can do this through your job via a 401(k) account, an IRA, or even a brokerage account.
It’s important to diversify your investment strategy so your portfolio isn’t just relying on one source. You may even want to consider dabbling into real estate if it’s something that interests you.
Needless to say, if you’re going to be living below your means, it will be easier to free up money to invest. By the time you reach 30, you can already have a nice nest egg stash and already have the habit of prioritizing retirement savings.
Do you have a bucket list of financial moves to make before you reach 30? What’s #1 on your list?