Learn how you can build wealth at any age.
Most Americans dream of early retirement with ample savings in their accounts. However, what most people don’t realize is that this is an attainable goal. While you don’t need to make six-figure salaries to retire in style, you do need to make sure that you start planning very early on. Here’s how you can start building your wealth at any age.
In Your 20s
Now is the time to build the foundations for your financial future. Make sure you curb wild spending habits and start working to put any debts, such as college loans, behind you. Your 20s should be all about living frugally and saving your cash. Don’t make any huge investments like a brand-new car or fancy apartment; instead keep things on the low end. Additionally, you should make sure you have a strict budget so you can ensure that you’re saving as much as possible. It’s also a good idea to open a retirement fund and start saving now.
In Your 30s
You may now have a spouse, children, and house payments to worry about, but you shouldn’t neglect retirement savings. First, make sure that you don’t spend more than 25% of your monthly income on house payments. You should also make sure that you have an emergency fund to cover a sudden household emergency. At this point, you should also maximize all your retirement savings options. For instance, if your employer offers 401(k) matching, then make sure you invest the max amount. Finally, you should prioritize retirement savings over your kids’ college funds.
In Your 40s
At this stage in your life, it’s important that you have a clear understanding of your financial portfolio. Meet with your financial advisor to make sure you’re doing all you can to get your retirement savings where they should be. You should also avoid borrowing money from your retirement accounts. Pulling from your 401(k) means a stop to contributions until you pay back what you borrowed. You should also start getting serious about paying off your home. Increase mortgage payments to ensure that you’ll have a mortgage-free retirement.
In Your 50s
Individuals aged 50 and older can now invest additional money into their Roth IRA, so take advantage of this. While you can claim retirement benefits as early as 62, do your best to hold out till the max age of 70. This will increase your monthly benefits. At this age, medical issues become more common so make sure you have health coverage at all times. Without insurance, a health scare could drain your savings.
This is just a brief overview of how you can start building wealth at every stage in your life. For a more in depth guide, visit Dave Ramsey’s website.
Another way to make sure you save is by getting the best insurance coverage to fit your budget. To find the best policies at an affordable price, contact the team at Stromsoe Insurance Agency in Murrieta, California. Our dedicated team is ready to assist you with all your insurance needs.
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