VOL. 129 | NO. 138 | Thursday, July 17, 2014
Rays of Wisdom
Dana and Ray Brandon
Thoughts for 30-Somethings
By Ray and Dana Brandon
Ray’s take: You spent your 20s setting up your life – developing some marketable skills, getting a career started, (hopefully) creating a budget, and learning to live with it.
Now that you’re in your 30s, it’s time to expand on all of that. Here are a few things to consider as you move along life’s path.
Take time to safeguard what you’ve built by writing a will. Make sure what you have accumulated goes where and how you want it to go. Your state has written one for you, and if you don’t bother, you may not like what it says.
Think about life insurance. Your future income stream is a huge asset that doesn’t appear on your net worth statement. Is there someone depending on that asset? A convertible term – which means a policy with a low initial premium but which allows the insured to convert to a permanent life policy later on if you need to without having to prove insurability – might be a good product to cover your needs.
Think about the next “big thing” in your life, and start saving to make it happen.
Start the habit of investing every month and maxing out that 401(k) you learned about. Use any raises you may receive to bump up your savings instead of just being absorbed into lifestyle. Make a plan for when you don’t want to have to work anymore and how much you want to spend then. Pay yourself first (PYF) every month.
Make sure you keep your credit in good shape. Pay down any lingering debt and think twice about taking on any more. Never ever borrow for depreciating assets. Trying to “keep up with the Joneses” is a losing situation. Don’t compare yourself or your stuff to others. There will always be some with more and some with less. What matters is what you choose to make of the resources and opportunities you have.
Now is the time to make sound financial decisions that will carry you through the rest of your life.
Dana’s take: Now that many people marry later in life, those extra few years provide a great opportunity to pay off student loans and credit card debt. It may take an extra job or project, but what a great way to start a life with someone you love. After clearing the debt, saving and investing can help you ramp up your financial assets to allow you to achieve your dreams.
To 30-somethings searching for a mate, I implore you to look at financial responsibility as a form of trust. Can you trust your future mate to spend in a way that builds financial security? Has he or she shown financial independence or are parents still footing bills and providing financial rescue from debt crises? Financial red flags could signal stormy waters for the relationship.
Sharing money as a couple requires a great deal of trust. Sharing your life with someone who has earned your trust will pay great dividends.
Ray Brandon is a certified financial planner and CEO of Brandon Financial Planning (brandonplanning.com). His wife, Dana, has a bachelor’s degree in finance and is a licensed clinical social worker. Contact Ray Brandon at email@example.com.