As you make your way into your 30s, you’ll most likely be out of school and living on your own with a full-time job. This means that it’s time for you to start thinking about your future and looking out for your older self. Do you want to have kids, start your own business, retire early, or just live comfortably? If so, there’s no better way to ensure a bright future than to start building your wealth as soon as possible.
Today, prepare to dive into the ways you can build wealth in your 30s:
- Why should you build wealth in your 30s?
- How to Budget
- How to Invest Your Money
- How to Increase Your Income
Why Do You Need to Build Wealth in Your 30s?
Up until our thirties, it’s easy to fall into the mindset that “growing up” and “getting old” are distant futures that we don’t need to worry about. But now, those futures are becoming a reality. This can be alarming but don’t panic, there’s still time to make sure that you’re ready for what’s ahead.
But why do we need to do all this worrying about the future?
Well, as much as it would be nice to always live in the moment, we need to look out for who we will be tomorrow. If you don’t ensure that you’ll have enough money to make it when times get tough, you may be stuck living paycheck to paycheck at a dead-end job. I think it’s safe to say that none of us want that.
Having wealth also just makes you a more high-value person to employers as well as potential friends and partners. Handling your finances well means that you’re responsible and reliable, that’s a pretty attractive trait. Then there’s the obvious benefit — you’ll have more money! Though money can’t buy happiness, it can get you close; the more you have, the more opportunities open up.
So how can you start to build your wealth in your 30s? Here are our top 3 best ways to do it!
- Budget the money you currently have
- Invest your money wisely
- Take steps to increase your income over time
How To Budget Your Money
Budgeting your money should be your first step in gaining wealth. You can’t accumulate wealth without first properly managing the money that you’re already making.
Typically, as you get older and gain more work experience, you start making more. This is great, but a problem many people in their 30s face when their income increases is that they start spending to match this new income. If you’re making more and spending more at the same time, then your financial situation isn’t really any better. This brings us to the #1 rule for budgeting: Spend less than you make.
If you tend not to keep track of your spending much, you may very easily be spending a lot more than you need to. Chances are that just being a little bit more careful with what you buy can have a huge impact on your finances.
The first step to spending less is to identify what you really don’t need to be buying. This could be a ton of different things:
- Eating out frequently
- Buying luxury items like fancy cars or the newest iPhone.
- Indulging in expensive hobbies like golfing or skiing
- Buying designer clothes
- Signing up for a bunch of online subscriptions.
Sure, having luxury items is great, but if you’re looking to build wealth, you’ll have to settle for what works instead of what is associated with higher status. Instead of spending money on the things above, consider these alternatives:
- Meal-prepping to save money on food
- Buying what works well but not the latest version or most expensive model
- Stick to less expensive hobbies or get equipment second-hand
- Buy dupes or go thrifting!
- Cancel subscriptions you aren’t currently using and get them back when you need them.
It can suck to deprive yourself of little treats and luxuries, but cutting back on those things will just make them feel so much better when you do let yourself indulge. Saving your money is a game of moderation — you can still treat yourself, just not so much that you’re overspending. In fact, rewards help you work harder, so be careful not to deprive yourself of everything fun!
Another important step for budgeting is to, of course, keep a budget.
Keeping track of your spending will be much easier if you keep track of it. So keep a document where you can designate how much of your paycheck is going towards what. These designations should include weekly or monthly payments for savings, food, bills, debt, investment, and leisure. A good budgeting rule to follow is the 50-30-20 rule. 50% of your income should go to needs, 30% should go to wants, and 20% should go to investments and savings.
How To Invest Your Money
Another way to actively increase the amount of money you’ll have in the future is to invest! You work hard for your money, so why not have your money work for you as well? There are tons of ways to invest like stocks, bonds, cryptocurrency, and more. However, there are two types of investments that are far more important.
- Investing in a retirement account.
- Paying off debts and loans.
It might be hard to face the fact that it’s already time to start preparing for your retirement, but when the time comes you will be thankful you invested your money into a retirement fund.
Whether it’s a 401(k), an individual retirement account (IRA), or a Roth IRA, putting money into a retirement account regularly will ensure you’ll be set for retirement. When you put your money into one of these accounts, it gains interest over time, allowing your investment to vastly increase by the time you eventually need to dig into the cash. However, these plans do have minimum investment requirements. You should make sure you will be able to contribute what you need to before you begin investing.
Perhaps even more important than a retirement plan is paying off your debts and loans. Big debts gain interest over time, increasing the amount you’ll need to pay. If you’re looking to accumulate wealth, you’ll need to be paying off all of your debts first. Not only is this good for your future, paying off debt also reflects well on your credit score. A good credit score will ensure you can get more loans in the future if you need them.
Stocks, NFTs, and cryptocurrency are more risky investments because you’re never sure if you’ll increase your money or lose it all. This kind of investment should be prioritized.
How To Increase Your Income
When you think about increasing your wealth, the first thing you probably think of is earning more money in the first place. But this part of the process is much easier said than done. More money usually means more work.
Here are some of the most accessible ways to increase your income:
- Get a side gig - Pick up another source of income on the side of your full-time job. This can be an extra part-time job or a side hustle like freelance work.
- Switch jobs - It may seem risky, but if you want more money you need to set your sights higher. If you aren’t satisfied with the pay of your current job, apply for better ones. You miss 100% of the shots you don’t take!
- Pick up extra shifts - If you are able, pick up that dreaded overtime or ask your boss to give you more shifts.
- Get a raise - If you are consistent and hard-working in your current occupation for long enough, you can make a good case to your boss to give you a raise. This one may be tricky, but with time it is possible!
Increasing your income will allow you to cut back on your spending less, making things generally easier on you. Of course, if you want the best results you can increase your income and cut back on spending, resulting in a faster accumulation of wealth.
Make the Most of Your 30s!
It’s easy to get caught up in worrying about money, but don’t let it take over your every waking moment! Your 30s are a unique point in your life. You’re still young, but now you’re established and are beginning to accumulate money and wealth from years of working. You can finally do the things you wanted to do in your 20s but didn’t have the time or money for! There are tons of opportunities out there for you to take advantage of, so try to find the balance between work and life! You deserve it!
