5 Things 30-Year-Olds Don’t Have Enough Of
As humans, we tend to set up milestones for ourselves. It's fairly common to take stock at the end of each decade of life, and figure out what we need to do differently. One of those major milestones seems to be the age 30.
At age 30, you are assumed to be moving forward with life. You're firmly in the adult world, but you might still be making the mistakes of post-adolescence. Chances are that you're looking around at age 30, and wondering why you aren't in a better position. If you are 30, or about to turn 30, consider that you probably don't have enough of the following. (See also: 5 Expenses to Ditch After Age 30)
1. Retirement Savings
It's hard to think that you need to worry about retirement when it's 25 to 30 years away. However, now is the time to be setting aside money. The longer you let compound interest do its thing, the more money you will have later. And that's important.
A recent survey conducted by LearnVest and Chase Blueprint found that the median amount of money that those ages 25-32 have saved for retirement is $12,000. That's not a whole lot to go on. You aren't going to reach your retirement goals if you are only setting aside $100 a month. You probably need to ramp up your retirement savings if you expect to enjoy your golden years in comfort.
2. Emergency Savings
A large number of Americans are without emergency savings, and 30-year-olds are likely to be in that group. According to a recent Bankrate Financial Security Index survey, 28% of Americans have no emergency savings at all. An additional 21% of Americans have some savings, but less than three months' worth. When you total that up, it's clear that 49% of Americans don't even have enough emergency savings to last three months. Only 25% of respondents say that they have at least six months' savings.
Chances are that you fall into the "not enough emergency" savings group — and it's probably time to ramp it up so that you are prepared for what could be next.
3. Life Insurance
Is your family adequately protected in the event of your death? Life insurance is an important part of financial planning. Unfortunately, many 30-year-olds don't have life insurance, and, if they do, they don't have enough of it.
According to J.D. Power & Associates, 40% of adult Americans have no life insurance at all. On top of that, 25% of those who had spouses that died between the ages of 30 and 55 felt that there wasn't enough coverage. When you think about it that way, it becomes clear that you need life insurance.
If you care about your family, you should consider boosting your life insurance coverage. Term life is very affordable; you can get a large amount of coverage for a fairly low premium.
4. Income Diversity
While it's nice to have a good job with great benefits, it's important not to become too dependent on one source of income. In the current economy, you never know when layoffs will strike. As a result, it's important to be ready with diverse income streams. A good emergency fund can help shield you, but it's also a good idea to look for ways to build your assets.
You can start a side hustle, monetize a website, get involved in selling items and crafts on eBay, Craigslist, and Etsy, build a dividend portfolio, or engage in a creative endeavor that brings royalties. While you don't need to try to replace your day job, you can reduce your reliance on a single source of income (your day job) for your financial wellbeing.
5. Long-Term Financial Planning
At 30, you probably don't realize how important a long-term financial plan is. In fact, you probably don't have nearly enough financial planning under your belt. Your complete financial plan should include a look at major milestones, from buying a house (if you decide to go that route) to having kids to sending those kids to college to retirement.
You should have a long-term financial roadmap that can get you to where you want to be. You can sit down with your life partner and work this out, or you can go to a trusted financial adviser to get help. But you need to make a plan. You should figure out what you need to do to create the lifestyle you want now and for the future.