By Akujor Clinton
You indeed have witnessed the change in the life of a single, carefree college graduate into a serious future as you start a family and fulfill your job duties for the next stage of life. Your 30’s is the most important part of your life. At this stage of your life, you are mature and can make a huge difference.
Keeping your adulthood from entering middle ages warrant a change of priorities. Once you stop counting the days for the next paycheck, it’s time to start preparing the financial future. There are so many cash errors, and you can not even know it.
Don’t let your social responsibilities erase it now that you have a respectable salary. There are six money traps here, which you should stop in your 30s at all costs.
1. Buying a Car you can not afford
Don’t buy an expensive car today only to affect other expenses tomorrow. Citizens need travel, but there is so much price volatility that you must carefully invest. In the first year, a new car from the supplier loses about 30% of its value and half by the end of three years. Learning to secure and appreciate what we already have makes it easier to spend more on investment.
2. Buying a house that is too costly.
It may be a reasonable expense to own a house that raises its value, but there is a point of decreased returns. If you drink every penny, you get into a home mortgage that you can’t afford; there’s no room for emergencies left. Don’t spend more than 20% of your net worth to get a house. For example, if your annual income is one million naira, don’t spend more than two hundred thousand per year in getting a house. This is called the 20% rule.
A monthly payment you can hardly afford could, on average, weigh 30 years on your budget. Instead, keep an eye on the local market and buy if you can get a home at a moderate price.
3. Not Investing or Not Investing Enough.
While some people prioritize short-term investment gains, pension planning is a marathon, not a sprint. The faster you start, the more you can build up. Starting savings and retirement plans require the balance between covering your bills, reducing existing debt, and putting aside funds that will help you repay. Make sure you make the most of your 30s savings using the advantage of compound interest.
Life is moving fast, so you don’t want to miss your chances. Investing now gives you decades to develop expertise and trust and watch your money grow.
4. Not being Financially Literate
Smart money management isn’t always easy when you want to start a family, develop and appreciate the money you work for. You will have to make decisions that can affect your money’s short and long-term viability. Educate yourself on the money. Know how to read and interpret financial statements. Speak about money to your spouse and children
5. Not having Financial Goals
Make sure you have clear financial goals. Know how much you want to make and invest.
Most couples get married and know very little about financial habits. This money mistake extends to all generations who enter a partnership. Take the time to talk to your loved one about financial ambitions and spending habits before you tie the knot. The third leading cause of divorce is financial issues. A successful marriage is more complicated than managing assets, but merger financing can often be a challenge in the early years of a partnership. Make financial targets together and hold daily talks on monthly spending and accounts. This may take years to complete joint finances, so be flexible and prepared to negotiate if you both see the money differently.
6. Not having high-income skills
Strive to increase your active income. High-income skills involve generating income on your side. It is not a side hustle or company generated. It is transferable and can be learned personally. Use the internet to learn some of these skills today.
Most people at this stage don’t know how to develop high-income skills. While luckily, you avoided these financial traps in your twenties, in your thirties, there are a lot of cash errors! If you can avoid this trap, you can have financial success.
Life starts to take your 30s a little more seriously because you have more responsibilities at home and work on your shoulders. You can do both financially and emotionally by focusing on living within your means and making a plan for the future. Only note that time is the greatest asset you have. You still have decades to overcome any obstacles on the path known as life.