Finance Strategies for Your 20s and 30s: Save Now, Retire Happier

Written by: Sara Bailey


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If you thought waiting until your 40s or later to plan for retirement was a smart idea, think again. The right financial strategy earlier in your life (and career) can position you for a more rewarding retirement in the future. These strategies from Katje Law Group will put you on a smart fiscal path that’s worth every penny.

Save and Invest as Much as Possible

Fresh out of college, young professionals might find they’re suddenly earning more and spending just as much. A freewheeling phase might be beneficial for your mental health, but getting down to business money-wise is crucial.

Though you have a long career ahead of you, starting early is essential for saving and investing in your future. As soon as you’re able, begin contributing to your retirement and set aside cash in savings.

Don’t leave your cash in the bank for too long, though; a savings account with enough funds to cover three to six months of expenses is an often-recommended buffer.

Then, consider investing in stocks either with the help of a trusted advisor or on your own through research (and possibly low-risk investment apps).

Make Family Planning Financial

Not every 20- or 30-something plans to have kids, but if you’d like to have a family in the future, figuring out finances now is a smart move. Raising children can be expensive, and you’ll want to plan for their financial futures in addition to your own.

Consider your family planning timeline, insurance expenses for your family unit, possible housing needs, and life insurance. Having your ducks in a row when the stork arrives will help you stress less and enjoy parenthood more.

Strategize for Homeownership

Homeownership is a common and important goal for younger adults; 74 percent prioritize owning a home, notes CNBC. Homeownership ranked above a comfortable retirement, a successful career, or even having children for many survey respondents.

Yet the housing market is a difficult place for anyone, let alone younger generations building careers. Saving and investing is one step toward one day owning a home, but there are other ways to prepare, too.

Building your credit — and avoiding debt — is one way to increase your odds of qualifying for a mortgage in the future. Build your credit score by making payments on time, keeping credit card utilization low, and letting current accounts mature (without opening new ones), recommends Equifax.

Exploring home loan programs unique to your career or location is another way to prepare for homeownership. For example, teachers can qualify for unique mortgage options, and people living in rural areas can use a United States Department of Agriculture (USDA) loan to purchase a property.

Knowing about potential loan opportunities lets you create a savings and credit roadmap to qualify down the road.

Don’t Discount Employee Benefits

A lucrative career should top your list of estate planning priorities. A professional path with upward mobility and job security checks all the boxes. Yet one thing you might not consider as part of the financial package is employer-provided programs.

Employee benefits vary widely by organization and industry, but many companies offer 401(k) or similar retirement plans, life insurance, pensions, and stock options. Exploring possible employee benefits can help you divert more of your income to savings and retirement, often with employer matching.

When considering a job offer or career move, factor these benefits into your salary package. While a higher take-home amount is appealing, small cuts out of your check today could create a more comfortable retirement in the future.

Keep Organized Documentation

Part of estate planning is keeping meticulous records. From your will and property deeds to life insurance policy information, retirement plans, and investment portfolios, these documents need to be kept safe and private.

One way to conserve your records is by digitizing them for easy access and protection, notes PCMag. You can even create a single document, versus tons of separate files, by using an online PDF tool. Then, you can reorder, rotate, and delete pages as needed.

Estate planning isn’t just for mature adults nearing retirement. Young adults should also plan carefully for their financial futures, and it’s never too early to start thinking (and saving) smarter. If you need assistance with estate planning, lean on the expertise and experience of the Katje Law Group. Get in touch today by calling (714) 400-2970.

Contact Katje Law Group today at 714-400-2970 or info@katjelawgroup.com