“I love my age. Old enough to know better. Young enough not to care. Experienced enough to do it right.” – Anonymous.

Perhaps this is what being 30 feels like!

Financial planning in your 30s is a different ball game altogether. While “how to save money” is definitely a crucial question to begin with, the elephant in the room is “how to grow money and pay off debts.” There is no room for financial extravaganzas like you might have indulged in during your 20’s.

With greater earnings come greater responsibilities. Buying a house or car, getting married (or already married!), preparing for the responsibility of children are just some of the areas that grip every inch of your financial freedom.

“How to save money?” is a single question that will keep haunting you in every phase of your life. While financial planning in 20’s is rather easier, saving money in your 30s is an art of its kind. Let’s talk about some of the proven tips to save money considering the financial bumps that will come your way.

Read More:How to Save Money- Financial Planning in your 20’s

You are still paying off debts!

Hopefully, you should have already paid your student loans. But if you haven’t, it is time to get serious about tackling that debt because any negligence in this can ruin your financial budget. Pay off all your debts including credit cards. Try to keep the balance of every card below 30% of the card limit as you will be applying for loans (home/car)as well. A balance above the card limit may adversely affect your credit score which is not a good thing for your finances.

Read More: Start Early to Zoom Ahead in Life!

You are spending a large chunk of the budget on eating out!

According to a report by Rediff –Urban Indian Millennials spend 13% of their food expenses on eating out which includes purchasing cooked meals from restaurants, canteens, and caterers.

Inadvertently, you spend a significant amount on eating out. If you are serious about managing your budget, you must develop an inclination towards homemade meals. You don’t need to be a gourmet chef to do so; even simple basic meals will serve the purpose and will prevent spending on unnecessary (and unhealthy) food.

You are married!

As you approach your 30s, marriage is bound to be on your cards (for most), and it comes with many financial duties. Your impulses compel you to take a plunge and get a nice house, a cool car and a life you have dreamt of in your 20s. Wait! Be careful as it doesn’t make any sense to accumulate more liabilities than your income permits. Assets are important, but you don’t need to acquire them as soon as you turn 30 or get married. A hasty decision might turn into a regretful financial blunder.

Contrary to what majority of people think - buying a house and owning a real estate is not a secret to financial success. If your home is taking money out of your pocket (in the form of loan), it is more of a liability than an asset. As you turn 30, understand the difference between assets and liabilities.

Read More: Financial Planning Guide For Newly Weds

You are still carrying the vices of your 20s!

“A budget is telling your money where to go instead of wondering where it went.”- David Ramsey

When you were in your 20’s, you might have accumulated more vices than you care to admit. Alcohol, cigarettes, partying every weekend in clubs, and fast food are just to name a few. All these rob the lion's share of your income and you don’t even realize. Cut back all of them as they are not just a burden on your wallet, but also on your health and are factor that would contribute towards any form of health/life insurance you might want to buy down the line.

You are going to have little humans!

Having a tiny little angel in your house is bliss. However, parenting comes with multiple financial responsibilities. Consider the finances before you plan to have children so that the gift of a child (even if it is unexpected) does not create financial challenges down the line. Build a separate fund for their schooling considering the rising cost of education.

Moreover, it is also a time to revisit your health insurance plan. Do not depend solely on your employer’s insurance plan. Instead, consider purchasing a family floater with sufficient coverage. If you don’t have children now, go through your health insurance plan and make sure that it covers pregnancy-related expenses.

An unfortunate situation?

You are busy building up a strong financial foundation for your family. But what would happen if you land into an unfortunate situation? Adversities in life are unpredictable. Your family should not suffer financially and struggle to make ends meet in such situations. So, purchase a term life insurance. Early 30’s is the right age to start a term life insurance as you will have to pay lesser premium.

As a thumb rule, increase your investments proportionate to the increase in your salary.

Your 30’s are going to be a bumpy yet enriching ride as you start a family, become more stable and take great leaps in your career. To enjoy this phase to the fullest, secure your finances.

How to Save Money- Financial Planning in your 20s?

Financial Independence is not about higher income! Break Free from #MindManacles

AN AUG 07/18

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