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Turning 30 is a significant milestone; also, it marks the end of a carefree stage of life to a more responsible, mature stage of life. This when most people start thinking about their wedding or start planning to have kids, which also means more responsibilities.
Also, one should start thinking about the usage of money in the direction of achieving goals. If you are already on this journey, that’s great. If you haven’t started yet, then know that it cannot get easier than starting ‘Now.’
List of things you should start doing before you get into your 30s-
Turning 30 would mean you have decent work experience and earn a decent salary. You might have also saved or invested some, mostly in low return yielding fixed deposits or recurring deposits. But saving is different from investing. If you want to achieve your long term goals like buying your first home, saving for retirement, buying your dream car, etc., you need to start putting money where it gets a chance of high growth.
Equity instruments are one of the best ways to achieve this. Starting a monthly SIP can be an easy task as the investment can be automated. SIP also brings investing discipline and eliminates any short term market fluctuations to affect your portfolio.
Usually, we have many goals and less money to save; the key is to prioritise. One goal that you shouldn’t be delayed is saving for retirement. This aspect is ignored most of the time as a car, or your own house is more tempting. But if you don’t begin now, building a corpus for a comfortable retirement might get complicated.
Turning 30 means more responsibilities, but it also means taking a step forward to free yourself from debt obligations. Any debt obligations like personal loan, student loan, credit card EMI etc., should be repaid on priority. These loans carry high-interest rates and should be avoided. On the other hand, a home loan can be availed as there is an underlying asset that will appreciate with time.
The pandemic showed everyone that we could not take the health cost lightly. Individuals who did not have sufficient cover during these times must have been out of all savings in case of admission of any family member in a hospital. Hence, having health insurance in place is crucial to living a secure and stress-free life. Many employers provide a corporate health cover; however, solely relying on it is not enough. The insurance cover is available only till you are working with the employer. So, one should avail personal health insurance policy as for self and all dependent family members.
The health insurance premium is less when you are just 30 years of age, and along with the benefits of comprehensive coverage. Also, you can claim the premium paid as a tax deduction under Section 80D.
Health insurance is a popular form of insurance that everyone avails of; however, a term insurance policy is often given less importance. A pure term insurance policy is vital to secure your dependent family members from any financial turmoil that may arise due to an unfortunate event.
We should consider buying a good term plan before turning 30, which would mean paying a lesser premium and availing of extensive coverage benefits. Moreover, the premium can be claimed as a tax deduction under Section 80 C.
An emergency fund is the most critical step for complete financial planning. Creating an emergency fund means saving or investing at least 6-12 months of your basic expenses for any emergencies. The purpose of this fund is for meeting any unforeseen emergencies like medical bills not covered by insurance, a sudden job loss or any other unexpected expense. While investing for emergency corpus, one should keep in mind that the investment should be made in low-risk instruments offering stable returns with ease of liquidity.
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