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Smart money moves to make in your 30’s

Table of Contents
Your thirties 1. Strengthen the foundation 2. Get on track for retirement 3. Prepare for owning a home (if that’s a goal of yours) 4. Prepare for children and the cost of having them (if that’s a goal of yours) 5. Let your goals and priorities be the guiding light

Getting smart about your money in your thirties is all about making sure your foundation is solid and you’re building as much as you can.

Here at Planswell, many of our clients ask us: “What should I be doing with my money right now?” It’s an excellent question, and it’s important to remember that every financial situation is unique.

We’ve organized a series of advice that can help you make the smartest money moves throughout your life, that Future You will seriously be thankful for.

Keep in mind that although the advice is organized by decade – money management is about where you are going, not where you are at the current moment in time. Don’t panic if you and your money experiences don’t exactly fit on this timeline.


Your thirties

Those in their thirties know that it’s often the decade when all major things begin to happen.

In your career, you’re building up on the momentum you started in your twenties, reaching for promotions, and grinding for those career highs that are coming later on. Outside of work, your life probably has probably seen a few big events. Whether you’re growing your family, travelling (this time sans backpack and hostels), meeting a partner, and/or purchasing a home, you’ve been busy.

Your money has been busy too. Your twenties were fun… but now that the dust has settled and you’re part of what some call the real world, here are some significant financial moves you should make this decade.


1. Strengthen the foundation

If you’re battling high-interest debt, or haven’t saved up a full emergency fund, it’s crucial you get these finance basics set up first.



First things first, debt.  Anything with an interest rate above 5% is going to cost you thousands in interest by hanging on to that balance. This includes credit card debt and personal/student loans.

If you’re struggling with debt repayment, here is a tip: Pay the minimums across all your accounts, and any extra cash that you can find in your budget should go toward the debt with the highest interest rate. This is meant to help you pay the least amount of interest possible. Called “snowballing”, you move the entire payment (minimum + extra cash) to the next highest-interest rate debt once you’ve paid off the first debt. Continue this until all debt is paid off.


Emergency Fund

We’ve said it before, and we’ll say it again; it’s always recommended to have three to six months worth of take-home pay saved.

It’s likely that you have much more responsibility today than you did just five or 10 years ago. A partner, home, and a pet or two are probably just the start of a long list of important factors in your life that you need to care for and protect.

A strong emergency fund won’t take away any of this responsibility, but it will help you sleep better at night knowing that if you get stuck in a sticky situation, your finances won’t take a hit.


2. Get on track for retirement

Once you’ve tackled your debt, and an emergency fund has been checked off the list, you can focus your attention more towards your retirement.

The sooner you can, the better. Why? The sooner you begin to invest with intention, the more money you’ll have in the long round, thanks to what we know as compound interest. Historically, a dollar invested into a Registered Retirement Savings Plan (RRSP) or a Tax-Free Savings Account (TFS), has been worth more than a dollar down the line.

Now is the time to consider allocating more of your budget towards your retirement accounts, especially when your money works for you.

Here at Planswell, we know that figuring out how much to put in which account, for how long, at what rate can make anyone’s head spin. Just because you may not be an expert, doesn’t mean you can’t take responsibility and understand what’s going on with your money – this is your retirement after all.


3. Prepare for owning a home (if that’s a goal of yours)

We support you buying your dream home, but it’s also important that you feel confident that this is the right step for you – before you decide to buy. Despite what people may tell you, it’s not always the better choice.

Next, you should start to save for a 20% down payment, which is often the recommended amount. This puts you in a good position for a low-interest mortgage loan and seriously reduces your risk of owing more than you own. You should also set some money aside for closing costs, which can range from 2-5 % of the home’s final purchase price.

Make sure you’re financially (and mentally prepared) for the additional costs besides your mortgage when you purchase a home.

Annual property taxes are a major cost, and each community is slightly different in what is due. You’ll want to know precisely what that annual cost breaks down to on a month-to-month basis, on top of your mortgage payments. Also, do your research on utility costs, such as water and heating bills.

If this all seems a bit overwhelming, here at Planswell we can help break down some of these costs that aren’t as easily visible when you’re first looking at just a mortgage payment.


4. Prepare for children and the cost of having them (if that’s a goal of yours)

If you’re thinking of growing your family and having children (no pressure, it’s a personal choice), now is the time to prepare.

This is especially true if you’re planning to take a break from your career or don’t have paid family leave at work. Deciding whether or not to take time away from work is a personal choice. It can be wonderful, but it does tend to be quite expensive. Basically, the more you can do to get financially ready, the better.

Of course, once kids are here,  there’s a whole range of other costs. That’s exactly why we built a Child Affordability Calculator to help you calculate how much you actually are looking at, in terms of expenses over the next 18 years. Children also should be good motivation to purchase yourself a life insurance policy, if you haven’t already. Also, consider opening a Registered Education Savings Plan (RESP) once your family has grown, if you’re interested and in a position to do so.

If you aren’t on track for your retirement yet, don’t prioritize it. We know it’s a difficult trade-off, but remember that education financing options are available. You’re on your own to finance your retirement.


5. Let your goals and priorities be the guiding light

From building an emergency fund, to purchasing a home and growing your family, all while preparing for retirement, you have a lot of priorities on your plate in your thirties.

However, those may not be the only goals that building a financial plan can assist with. Perhaps you’re dreaming of finally starting your own business. Or taking a 40th birthday trip to Australia. It’s easy to get tunnel vision when you’re saving, investing, and moving towards your future.

But don’t forget from time to time, that your money is supposed to bring you the things that matter most to you. Slot these goals in with your other priorities, and work towards making them happen.

While there’s no doubt that you should be managing your money wisely in any decade of your adult life, there’s an argument to be made that your thirties are the most important years. Now is the time to maximize your time and resources, paying off debt and formulating good financial habits.

This will set you up for a financially sound forties. If you’re still feeling nervous and could use some help making sense of everything, or if you want to check-in and see if you’re on track, Planswell is here to help. Build your financial plan today and set yourself up for success.


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