You are currently viewing Financial advice from the financial planner for your 20s, 30s and 40s

Financial advice from the financial planner for your 20s, 30s and 40s

Your personal financial journey may not be the same as that of your sister or mother, as certain individual factors may affect the financial planning choices you make.

Once people are armed with proper financial information, they can navigate the course of their financial wellness journey, says Katlego Gaborone, financial planner at Momentum.

The story continues below

Gaborone shares his top financial tips for different age groups:

Financial advice for your 20s

“Many people in their twenties are still studying or have just started their careers and are finding their place in the real world,” says Gaborone.

– Talk to a financial adviser who can help you plan and set realistic goals and advise you on how you can invest your money.

– Pay off all your debts, including student loans, as quickly as possible.

– Set a budget and stick to it – only buy what you need and pay cash if you can.

The story continues below

– Start your own stampede as a way to earn extra income. You can use the money to pay expenses, pay off debts, or invest.

– Invest your money even if it is a small amount and earn compound growth.

– Don’t cash out your savings when you change jobs, reinvest the money instead.

The story continues below

– Get life insurance and medical assistance as well as protect your income to prepare for any unforeseen circumstances.

– Have three months salary set aside in an emergency fund in case disaster strikes and if you need the money.

– Make sure your credit score is healthy. A good credit rating means banks will give you a loan at a lower interest rate when you need it. Paying off the full amount owed on your credit card, each month and on time, will benefit your credit score.

The story continues below

Financial advice for your 30s

“For many, this phase is when families are founded and long-term investments are made. Think “save,” he says.

– Consider investing for the long term and consistently.

– Diversify your investments instead of putting all your eggs in one basket.

– Increase your emergency fund so you can handle any financial emergency.

– Make sure your credit card is paid in full each month and avoid bad debts such as clothing accounts.

– Think comfortable, not extravagant. So don’t use up all your savings when buying a house. Leave some leeway in case something bad happens and you can’t pay your mortgage.

– Make sure your life insurance and income protection policies can support your whole family.

– Have an updated executable to provide your spouse and children in case something happens to you.

– Spend less money than you earn and save; your future self will thank you.

Financial advice for your 40s

Gaborone says many in this bracket are focused on saving for retirement and living a comfortable life.

“Balance living and spending with saving and investing.”

– Increase the contributions you make to your retirement savings.

– Let the tax work for you.

– Check the beneficiaries on all your policies.

– Review your insurance and will policies.

– Talk to your parents about their finances.

– Pay off any debt with a high interest rate.

– Treat yourself by going on a dream vacation or doing the renovations you have been putting off.

– Teach your kids how money works, including good saving habits.

– Have an education policy for your children for their future studies.

“Even in these difficult times, there are many ways to counter financial desperation, and we are optimistic that with good financial literacy and planning, South Africans can thrive,” he says.

IOL Company

Leave a Reply