Every age comes with certain responsibilities, and 30s are definitely the time for big financial decisions that will shape the future of each individual. In 30s most people already found a dream job and some people even have a family to care about. It is very important to deal with decision making in the right way, since even the smallest mistakes can easily influence the financial future of individuals and their families. In this article we tried to list some of the biggest financial decisions a person can make during this age.
Start Choosing Employers by Employer Match Programs They Offer
Although most people already have jobs when they are thirty, this is the right time to start thinking about how much companies pay for worker’s 401(k) plans. During twenties people mostly don’t care about these things, but search for the job that gives them competitive salaries and enough free time. Importance of 401(k) plans is enormous and it is one of the most important parameters that decide how much retirement money is each professional going to save for the years to come. Company match programs are not required by law, so there are companies that offer no money at all. On the other hand there are very generous companies that add money to worker’s retirement funds. Most common practice for the companies is to pay “100% of the first 6%”.
Examining Insurance Needs
Most people do see the need for buying insurance before they start a family. Since thirties became the next twenties, the decade when most people start settling in with the family in a newly bought home, there is need to reassess their insurance needs. Life insurance policies will insure financial security of the family if something happens to the person paying it and it can also be used as savings account. Accept life insurance there are also some other policies that may interest young couples with kids. Insurance policies now offer many different policies that cover short and long-term disabilities and illnesses that prevent people from earning income. These can be taken as group policies together with colleagues or can be bought from individual brokers. Each new insurance policy should be well examined and discussed with other family members.
Choosing the Right Mortgage
30s are the age when most of the family oriented people choose good mortgage that will provide them with less interest, more equity and a roof over their head. Choosing between different mortgages can be a little bit tricky. Fixed rates are good if family plans to stay in the house for more than 10 years. If the mobility is what they need they may choose the more affordable mortgages with adjustable interest rates. These are good if they are planning to leave the house in less than seven years from the moment they start paying mortgage. Choosing bi-weekly mortgage plans can also save a lot of money, since these plans provide one additional monthly payment delivered annually. This way, debtors spend less money on interests and pay off their mortgages more quickly. Benefits of these mortgage plans can be easily counted with bi-weekly mortgage calculator that can be found online.
Start Making Kid’s College Fond
When it comes to collecting money for kid’s college expenses it is important to start collecting as soon as possible, even when kids are still at very young age. One of the most common ways to start saving money for kid’s higher education is by choosing 529 plan. This plan can be prepaid or saving one. Prepaid one allows parents to purchase tuition fees at today’s rates that can be used in the future when their kids reach collage age. The only way how money invested in prepaid plan can grow is by tuition inflation, while with savings plan growth of the investment depends on market performance of the mutual fund in which parents invest their kid’s college funds.