What to do with your money through the decades

Teach Me Money

Finances can feel like a topic shrouded in secrecy, something we're taught not to discuss openly. Whether you're a teen or in your sixties, understanding the best ways to use your money can be empowering. Here's a decade-by-decade guide to help you make the most out of your income, no matter where you are in life.

Teenagers: Building Foundations

Let’s start with the teenage years—a perfect time to begin cultivating good money habits. My biggest tip for teens is to save 10% of everything you earn. Whether it's from a part-time job or birthday money, paying yourself first and setting aside that 10% is crucial. This habit will build you a nice little nest egg and teach you the discipline of saving early on.

20s: Step into the Property World

Your twenties are a time of exploration and laying down crucial financial foundations. While it might feel challenging, buying a property—whether to live in or as an investment—can be a game-changer. This decade is the time to get your foot on the property ladder and think about long-term goals. Remember, property values can fluctuate, but historically, they've trended upward.

30s: Strengthening Your Financial Health

By the time you hit your thirties, you may find yourself more settled in your career and perhaps thinking more about the future. If you haven’t already, continue saving that 10% and consider increasing your superannuation contributions. An extra $50 per pay period can make a significant difference down the line. It’s all about making consistent contributions over a long period to ensure you have a secure financial future.

40s: Investment Insights

This is when financial strategies start to ramp up! If you haven’t already ventured into investment property, now might be the time. Leveraging the equity in your existing home can open doors to additional income sources and asset growth. This decade is about ensuring that your financial future is as secure and fruitful as possible.

50s: Focus on Freedom

It's time to pay off your principal place of residence if you haven't already. Owning your home outright by retirement is one of the greatest financial freedoms you can grant yourself. This is the age to focus on clearing that mortgage, ensuring your retirement years will be less financially burdensome.

60s and Beyond: Retirement Reality Check

Your sixties are all about maximising your retirement funds, ensuring that you've got enough to live comfortably. Increase your contributions to super if you can here and investigate strategies like salary sacrificing. Consulting with a financial planner can provide tailored advice to maximise your retirement savings and plan effectively for this next chapter of life.

No matter where you’re at in this roadmap, I highly recommend seeking guidance from a financial planner. They can offer personalised advice to equip you for each life stage. Although their services can be costly, especially in the later years, they can save you money and stress in the long run.

For further reading on this topic, I recommend "The Richest Man in Babylon" by George S. Clason. It's a timeless read that distils key money management principles through engaging parables. Whether you’re just starting out or well along your financial journey, this book will offer valuable lessons.

Here's to building a secure, financially prosperous future, one decade at a time. Until next time, stay wise with your money!

Links

Website: https://goldentrianglefinancegroup.com.au/