In this piece, we will look at 15 Money Mistakes to Avoid in Your 30s. If you wish to skip our analysis on the financial advisory market, you can go directly to 5 Money Mistakes to Avoid in Your 30s.
As you hit 30, it's decision time! Beef up your retirement savings, open a 529 for the kiddos' college funds, and keep tackling that debt. Check your emergency fund and budget, amp up your insurance, and avoid lifestyle inflation. Don't forget to plan your estate and consider diving into investing for that extra financial kick. Lots of options on the table – time to make them work for you based on your needs and requirements.
If you're wondering how much you should aim to have saved up by the time you hit 30, Taylor Kovar, a savvy certified financial planner, suggests a neat rule of thumb: try to sock away an amount equal to your yearly salary. It's a handy benchmark to shoot for as you cruise into your 30s.
From a hefty $94.8 billion in 2022, financial advisory service market is expected to reach a whopping $157.7 billion by 2032, scoring a solid growth rate of 5.3%. Small and medium-sized businesses are hungry for advice, high-net-worth individuals are on the rise, and folks are diving headfirst into alternative investments. They're all about investing, saving, and prepping for rainy days and retirement. It looks like financial literacy is the name of the game in the future.
Let's dive into some heavy hitters in the financial world: Morgan Stanley (NYSE: MS), BlackRock, Inc. (NYSE: BLK), and JPMorgan Chase & Co. (NYSE: JPM). These big names are at the top of their game, helping folks and institutions map out their financial futures like pros.
So, Morgan Stanley (NYSE:MS) is all about investment banking and financial services, covering a wide range of financial planning needs. They offer fancy discretionary investment options and tap into their global resources and expertise to keep clients happy. In the past year leading up to September 30, 2023, Morgan Stanley pulled in $54 billion in revenue, with a slight dip from the previous year. And in the last quarter of that year, they saw a growth with $13.27 billion in revenue, showing a positive trend. Back in 2022, their annual revenue was $53.67 billion, overall down a bit.
BlackRock, Inc. (NYSE:BLK) is like the big cheese in the financial world, with a massive $10 trillion of assets under their wing by the end of 2023. In January 2024, they dropped a cool $12.5 billion to snag Global Infrastructure Partners, diving into some serious alternative investments like ports and power projects worldwide. This move is set to beef up their infrastructure assets to around $150 billion, from gas in the US to airports abroad. BlackRock is playing for big stakes and making some major waves in the financial seas!
JPMorgan Chase & Co. (NYSE:JPM) is all about tailoring financial plans to match your dreams and make sure your assets are aces. They're pros at helping you reach your goals, from tax-savvy gifting to sorting out all your essential docs. J.P. Morgan is all about understanding what makes you tick and crafting a plan that fits like a glove.
In the year ending December 31, 2023, JPMorgan Chase raked in a hefty $158.10 billion in revenue, showing a solid growth of 22.85% from the year before. The last quarter of 2023 also saw a nice $38.57 billion in revenue, with a 11.66% jump year-over-year. Looks like JPMorgan Chase is riding high and keeping those numbers looking sweet!
15 Money Mistakes to Avoid in Your 30s
Methodology
To curate our list of 15 Money Mistakes to Avoid in Your 30s, we went over the internet to note down the most frequently mentioned mistakes to avoid in your 30s, from which we narrowed down 15 Money Mistakes to Avoid in Your 30s which would be of most use to a reader in their 30s. Let’s take a look at them.
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15. Credit Card Debt
1st on our list of Money Mistakes to Avoid in Your 30s relates to credit card. Credit cards might seem like a quick fix for impulse buys, but pause for a second and think: Can you actually afford it? Will your next paycheck cover the fun splurge and your monthly bills too? Credit card companies can be slick – they thrive on your slip-ups and unnecessary spending. Watch out for those sky-high interest rates and tricky fine print that could trip you up in a flash. Stay savvy and steer clear of those credit card traps!
14. Not getting Insurance
Hey there, when you're in your 30s, it's essential to take charge of your family's financial well-being. Your superannuation fund might have some insurance coverage, but it's crucial to figure out what YOU really need. Don't rely solely on default options – do your own research and tailor your insurance to fit your needs. Keep in mind that if you switch jobs and funds, you could lose your insurance, and getting new coverage might cost you more. Here's the kicker: getting long-term disability insurance is way cheaper in your 30s than later in life. So, if you're young and healthy, now's the time to lock in that personal insurance. Waiting until you're older or dealing with health issues could mean paying more or even getting turned down for coverage. Take control of your financial safety net now – your future self will thank you!
13. Getting carried away with kids’ expenses
Getting carried away with kids' expenses is 13th on our list of Money Mistakes to Avoid in Your 30s.
So, when you're in your 30s and you've got a little one running around, it's totally natural to want the best for them. But hey, watch out for that urge to splurge on all the fancy baby gear. Before you know it, your cash could vanish into a cloud of toys and gizmos. Take a second to think: does your tiny tot really need that high-end accessory? Maybe it's smarter to instead stash that cash in an investment or savings account or use it to tackle any debts you have. Keep those emotions in check and make sure your spending matches your financial goals – for you and your little bundle of joy!
12. Carrying Too Much High-Interest Debt
When you're in your 30s, watch out for that sneaky consumer debt trap. Debts may seem all fun and easy, but they can lead to a spending spree that's totally out of control. It's way too easy to grab an asset on instalments and forget how much you're losing out on the opportunity to save and build money.
And here's the kicker: those minimum monthly payments might seem handy, but they come at a cost. Many folks don't even realize the interest rates piling up, turning that $1,000 splurge into a $1,180 headache if you don't pay it off in full. Yikes!
If you're drowning in debt, focus on wiping out the highest interest balances first or think about consolidating to a no-interest card to tackle that debt monster. The key? Stay on top of your debt game and don't let those balances spiral out of control!
11. Not keeping track of your spending
11th on our list of Money Mistakes to Avoid in Your 30s is reckless spending patterns. In your 30s, it's key to watch where your cash is flowing. Mindless spending can really chip away at your wealth over time. Stick to spending less than you earn – that's the secret sauce to building up your bank balance. Keep an eye on your spending habits, track every penny for a month, and see where you can cut back. Avoid lifestyle creep – that temptation to spend more when you earn more. Instead, focus on striking a balance between enjoying life and saving for the future. Oh, and forget about keeping up with the Joneses – it's about knowing your own financial groove. Keep tabs on your spending and build your financial game plan, one wise move at a time!
10. Lifestyle inflation
In your 30s, when the cash starts flowing, it's easy for those wants to match up with your growing income. But here's the deal: treat your savings like a non-negotiable bill you gotta pay. Set up automated savings to keep on track and steer clear of splurging on unnecessary stuff just to keep up appearances. Don't sweat trying to keep pace with others – make thoughtful spending choices based on your needs. Stick to your financial plan and watch those savings grow!
9. Trying to Compete
Hey, one money mistake to avoid in your 30s is falling into the “keeping up with the Joneses” trap. It's all about social comparison bias – peeking at what others have and feeling the pressure to keep pace. But listen, your journey is totally unique. Comparing yourself to family or friends could push you to crave things you're not quite ready for. Remember, everyone's financial situation is different – from incomes to obligations. Stay focused on your own path and trust that good planning will get you where you want to be. Enjoy the ride and stay true to your own financial goals!
8. Saying no to taking risk in career
Hey there in your 30s! If you're not feeling the love for your job or see stagnant growth ahead, it might be time for a career switch. You've got experience under your belt, making you a hot commodity in the job market. Update that resume, explore new opportunities, and get ready to negotiate for a bump in pay and more responsibility. It's your chance to gear up for your top earning years. When weighing new job offers, look beyond just the salary. Check out the benefits package – from health insurance to retirement plans. Think about perks like working remotely, flexible hours, or even a car allowance. Your full compensation package, including those benefits, is what really counts.
7. Taking on Additional Student Debt
Opting for student debt is another mistake in our list of Money Mistakes to Avoid in Your 30s.
Thinking about heading back to school for another degree in your 30s? It's a big decision, so here are a few things to consider. If furthering your education is essential for your career growth or a career shift, it may be a no-brainer to pursue it. However, if you're contemplating additional schooling just to spruce up your resume or boost your LinkedIn profile, pause and reflect on a couple of key factors.
Firstly, weigh the Opportunity Cost of Not Working: Can you afford to put your career on hold for a while to focus on your studies? Consider if the potential post-grad salary will compensate for the income you might miss out on during your academic pursuits.
Secondly, think about Debt: Taking out student loans for graduate school can be a tempting option, but be mindful of the higher interest rates that accompany such loans and the immediate repayment demands post-graduation.
Don't underestimate the financial commitments and challenges that could come after earning that additional degree. Keep these aspects in mind as you weigh the pros and cons of going back to school for further education in your 30s.
6. Not caring about post-retirement needs
Hey, in your 30s, don't snooze on saving for retirement! Experts always stress the importance of starting early to build that nest egg, aiming for the hefty $1.7 million that folks believe is the magic number by age 65. As Kaleb Paddock, a financial planner, points out, compound interest is your BFF in your 30s. Even small bucks stashed away now can snowball into big savings over time. Unlike simple interest, compound interest multiplies your earnings on your existing returns, helping your money grow faster the longer it stays invested in retirement accounts like a 401(k) or Roth IRA. Time's a powerful friend when it comes to building that retirement fund, so make every moment count!
