Turning 30 is a big milestone in your life. It is kind of a point at which you should change from a guy into a man. I know you graduate college in your early 20’s, but society allows you some time to go from college graduate to a responsible man. I think that by the time you turn the big 3-0, society expects you to be grown up.
I am going to list some things you should have accomplished by the time you turn 30.
1) Cut back on the credit card use
The average 30 yr old has $20,000 in college debt and over $5,000 in credit card debt. By the time you turn 30, you ought to have a handle on credit and you ought to know about its evils. You should know that paying 20% a yr on new electronics is not a smart thing to do.
At this point in your life you should not be living paycheck to paycheck and you should not be racking up credit card debt. All credit card purchases should be paid in full at the end of every month.
2) Own a home -or- have a plan
By the time your 30, you ought to have some thoughts on home ownership. It is a good thing for most people. Don’t take a no money down loan or a 3/1 ARM or an interest only loan. Do put down 20%, negotiate hard for the price of the house, buy what you can afford, and be patient.
If you haven’t bought a house at this point, you are very lucky to be able to buy at one of the best times in recent history as home prices are very low right now. My father told me tonight of a house for sale where I grew up for zero money down and $340 a month payments. I rent a townhome, and my monthly cost is way higher than that.
If you haven’t bought one, start saving for a downpayment right now. If you are not going to buy one, then make sure you are saving a quarter of your income. See here and here.
3) Save at least 10% of your income
The way the things are looking, current 30 yr olds may or may not have social security to rely on for their retirement. This being the case, you are going to be at least somewhat responsible for your own retirement. Like I have said many times before, time (and compounding interest) is more valuable than the amount of money. This is to say that a little money saved early produces a more favorable result than lots of money invested for only a few yrs. As a rule of thumb, by the time you turn 30 you should be saving 10% of your paycheck at a minimum.
4) Have valuable skills
At this point in your life, you should be marketable. You want to bring something to the table at your place of employment. You need to stand out and differentiate yourself from your peers in some way. Should you ever lose your job, you want to be able to land on your feet. You want to be able to tell future employers reasons why they should hire you over the next guy.
5) Know yourself
You need to know your goals. If you do not know where you want to end up, how are you ever going to get there? You need to know your strengths and weaknesses and what is important to you. Thus you can recognize opportunities and take advantage of them. If you don’t know what is important to you, you’ll likely ramble around doing what other people do. You’ll buy a luxury vehicle because that is what your friend or neighbor bought. But his value set is not your value set.
You need to know your own value set so you can act in your own best interest. No one else is going to do it for you. You can’t afford to waste time or money because you’re ignorant of what is important to you.
6) Know smart people
It is impossible that you are good at every aspect of life, planning, finances, insurance, etc. And you don’t need to be an expert at everything. You just need to know a few smart people who you trust to help you on issues in which you are ill informed.
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