Seven Financial Goals to Achieve Before Age 30 to Retire Well
#2 - Be Well Surrounded and Advised
“What are the financial goals I will have to achieve before I turn 30? It’s a question that drove me crazy and triggered deep moments of reflection!
The purpose of this blog post is not to put pressure on you. Especially if you are over 30 and have not achieved those goals. Rather, it is more of a reflection on goals that I consider extremely important and whose fulfillment I feel is necessary to become financially independent.
1 — Be Financially Independent Of Your Family
That’s a bit of a start. This may seem obvious, but in reality, this first goal deserves a little more attention in its definition.
To put it simply, I will say that financial independence from your parents requires two conditions:
Have enough income to cover expenses and possibly save, with no help from parents factored into that income (whether donations, gifts, loans, bills paid by parents, etc.),
Be independent of your parents in terms of financial choices, so be able to make your own choices.
This does not mean that you should reject all financial help from your parents. But the goal here is to avoid a situation where you would be the beneficiary of what Stanley and Danko call Affordable Outpatient Care in The Millionaire Next Door.
Simply put, you may need occasional help from your relatives, for example for your contribution to your first home purchase. But on a day-to-day basis, you have to be financially independent of their help.
2 — Be Well Surrounded And Advised
Whether it is blogs, books, podcasts, newsletters, newspapers, conferences, forums, mentors, etc., you must find sources of information that will make you smarter and enable you to make the right decisions.
This may be just the beginning of your journey. This is the case if you have chosen to focus at the moment on reducing your debts, rather than in the next few years to learn more about real estate and financial investing, for example. What matters is that the process is started.
On the other hand, you may also have seen the bad advisors around you and are now immune to them. It could be your parents who are big spenders and tell you not to worry about your retirement or a friend who has received a nice inheritance and tells you that saving is useless. As you become a financial independence ninja, you can even start trying to change your mind!
3 — Have an Action Plan to Pay Off Your Student Debt
In the United States and Canada, it is common for former students to have six-figure debts, but in other countries, it is not standard to start professional life with a $100,000 student loan to pay off.
If you are one of the students in debt, the idea is to have, by the age of 30, been able to pay off the debts you incurred when you were a student or have a plan to do so (for example, having decided whether or not you want to make an early repayment).
4 — Beyond Retirement, Have Financial Goals Set For The Next Few Years
You are no longer sailing by candlelight and now have goals to accomplish. Of course, their quality takes precedence over their quantity. You can also have one main goal for 10 years and regular milestones to achieve. What matters is that they are in line with your values, your desires, and your means and that you are motivated to achieve them.
Once they are set, make sure you write them down somewhere and talk about them around you. People who write down their goals and communicate them achieve them more often than those who keep them to themselves. The situation is exactly the same for your financial goals!
Even if you are not yet using all the investment products, anticipating the future, you too may have set a date.
5 — Establish Your Financial System And Have A Budget Of Your Financial Flows
Achieving your goals will be possible through a sound financial system. In other words, it is the path your cash flows follow.
The idea is that with your income you add to your precautionary fund and investments that allow you to accumulate capital and generate additional income.
You must track your cash flows (expenses, income, and savings) and know where every dollar you earn goes and how it is spent.
In the first case, you establish a monthly budget that serves as a guide for your expenses and you analyze the differences at the end of the month. In the second case, at the end of each month, you simply analyze the structure of your financial flows and categorize your expenses.
6 — Determine Your Net Worth and Follow Its Evolution about Your Financial Goals
This is an article I have already written recently and you can read it here.
But your net worth doesn’t need to be the most important financial indicator, your financial freedom yes. But checking “regularly”, your assets is also a wise choice, but be careful, otherwise, you end up living in your Excel…
7 — Have You Already Invested Your First Dollars
To improve your financial health, you save. You are careful to always pay yourself first. But most of all, those savings are used and invested. You understand that the sooner you invest your money, the more it will earn. This maximizes your compound interest.
These investments can serve many purposes. They can prepare the purchase of real estate, residential, or reporting. They can also be used for your next trip around the world. Except if you are preparing for your retirement. Either way, they will get you closer to your financial goals at all costs.
What would you add to these financial goals?
Let’s achieve together these financial goals to be reached before our 30th anniversary.