Finances as we Age

As we age, our finances and investments will change.  When you are younger, it is hard to plan or think about the future when it comes to saving money.  But when you get to retirement age, you will wish you had saved much more for the future.  There are several money moves you can make as you grow older that will benefit you for life.


When you are in your 20s, the main goal is to try and not accumulate too much debt.  At this point in your life, you are probably investing in yourself for the future.  You may be going to college or getting training for a trade, which will cost you some money.  Start paying these loans back as soon as possible and try to stay away from credit cards.  A house loan or a car loan are not horrible loans to have, but anything else can really put a strain on your finances when you are just getting started in the world.


This is usually the age that children come into play.  When you take on the responsibility of an added person in your household, you need to account for them and their expenses in your budget.  Consider diapers and formula and of course daycare when you start planning.  This may mean you eat out at restaurants less and skip your summer vacation.  Start building up your emergency fund to cover your mortgage and bills for a few months, in case illness or layoffs occur.  Also, buy enough life insurance to cover any outstanding debt, should tragedy strike.


You should be at the top of your career by this point in life and you should have kids out of diapers and daycare.  This means you should have a little more money available to start investing.  You should invest in your retirement before you invest in your child’s college fund.  Your kids can get scholarships and great loans later in life, but there are no retirement scholarships.  Keep your home well-maintained to ensure you keep repairs at a minimum.  Investors state that 15% of your income should be going to retirement at this point, even better if there is a retirement program in place at your workplace.


This is the age you start thinking about retirement and the lack of commuting to work.   Make sure at this age you are ready to start paying off your mortgage.  The goal is to have your mortgage paid off before your retirement.  Rental real estate is a great thing to invest in at this point, if you are able.


It is now time to retire.  It is time to enjoy all the time you have earned by working for so long.  Tweak your budget and find ways to stay active during this time.  Take the time to travel and enjoy the rest of the years you have on this planet.  Spend time with grandkids and make sure you are giving back to the community.

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