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Your Age, Your Money

HOW TO SAVE, SPEND, INVEST AND GIVE RIGHT NOW!

You hear it all the time: Anyone can retire a millionaire.

It just takes discipline and attention to a few commonsense concepts like living on a budget, paying down debt, saving like crazy, being generous and planning ahead.  But, you ask, what does that actually look like in your 20s, 40s or even 60s?

Here’s my list of the best money moves to make at every age. And if you feel a little behind in the game, use it as fuel to work harder and smarter to get to where you want to be. It’s never too late.

20s — Build a Solid Foundation

  • Newly married or about to be? Go ahead and get on the same page about money. Good communication now will pay off in spades later.
  • Avoid debt. That means no credit cards, car payments or financed furniture.
  • If you have student loans, pay them off ASAP! Sallie Mae is not your bestie.
  • Buy good medical insurance. A single hospital stay can bankrupt you in a heartbeat.
  • Create an initial estate design to provide for heirs, close loved ones or children.
  • Practice the habit of ‘open hands’ giving to provide for faithful support of your church and those causes close to your heart.

30s — Shift to a Family Focus

  • If you are having kids soon, rework your budget for diapers, daycare, cribs and car seats. You will have a little less money, but you will have a whole lot more love.
  • Buy enough term life insurance to cover your family should anything happen to you or your spouse. We recommend getting 10 times your income.
  • Build up your emergency fund to three to six months of expenses. Sooner or later, you’re going to need it.
  • With children in the picture, you may be thinking about home ownership. Just make sure you can put 10–20% down at a 15-year fixed interest rate. (And keep your house payment to less than 25% of your take-home pay.)
  • Begin 529 savings for children’s education.
  • Review and update your estate design to provide for children and name guardians.
  • Continue to practice and grow tithing to charitable causes.  Participate in hands-on mission projects.
  • Practice hospitality by sharing your home and resources with those in need.

40s — Shovel the Savings

  • You’re at the top of your career, and your kids are finally out of daycare (or at least out of diapers). That means a little more money in the bank to invest. Go with a good growth stock mutual fund, and be sure you’re contributing 15% of your household income toward retirement.
  • Ramp up the kids’ college funds only after you’ve secured your own future. Your kids can get scholarships, but nobody gives scholarships for the retirement years.
  • Keep your home well maintained to avoid paying huge repair bills down the road.
  • Review and update estate design as family needs changes and children become independent.
  • Continue giving, serving and sharing … it’s now a lifestyle habit!

Retirement isn’t an age . . . it’s a financial number. Discern how to pace yourself to fulfill life purpose and create significance more than success.  Assess life timeline to meet intrinsic goals

50s — Look Forward but Stay Focused

  • You’re starting to look forward to a life without that daily commute. It’s okay to be excited. But don’t cash in your retirement savings just yet—keep investing a full 15%.
  • Now’s the time to pay off your mortgage. With the kids out of the house, maybe you can even downsize and pay cash for your next place.
  • If you have some spare change, you may want to invest in rental real estate for some extra income.
  • Continue giving, serving and sharing … look for those in need whom you can assist in a way that helps – not hurts.  Be missional in your giving and saving!
  • Get a financial advisor to help oversee and plan well for the future.
  • Review and update your estate design annually to manage any life changes and adjust to meet changing needs.

60+ — Enjoy the Fruits of Your Labor

  • It’s time to retire. But that doesn’t mean sitting on your couch all day watching documentaries or playing golf. Be proactive and tweak your budget. And find ways to stay active!
  • The day you turn 60, buy long-term care insurance. A few years of long-term care can deplete your entire life savings. So prepare for this possibility now.
  • Enjoy yourself! Without a house payment or a growing family to support, you can focus on fun: Travel abroad, visit the grandkids, and give generously to your community.

Winning with money is a marathon, not a sprint. It takes hard work over the long haul. So set your goals, stay focused, and keep moving forward. Your million-dollar payday awaits!

(Credit: Adapted from Dave Ramsey – Financial Peace University)

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