Financial goals by age: a decade-by-decade approach
Help meet your financial goals and stay on track for retirement with these age-based saving tips.
The specifics of your financial plan and goals may not resemble anyone else's. Maybe you want to trek the globe after you retire while your neighbor plans to dive into full-time volunteer work. Regardless, some shared steps can help get you on track for your future.
A common financial regret for many people is not saving early enough for retirement. Here's a breakdown of some money goals by age.
Financial goals for your 20s
- Establish a consistent income and good spending habits.
- Sustain (and live with) a budget.
- Eliminate debt (credit cards or loans), beginning with debt that has the highest interest.
- Enroll in health insurance.
- Start investing in a 401(k) and remember to contribute enough to receive the maximum employer match.
- Begin to develop an emergency fund to help prepare for any unexpected financial situations.
- Open savings accounts for big expenses and investment accounts for retirement.
Retirement savings for your 20s: Some experts recommend saving funds equivalent to one year of your annual salary or saving 15 to 25% of your pay as you receive it.
Financial goals for your 30s
- Fill your emergency fund with three to six months' salary.
- Eliminate additional non-mortgage debt, including student loans.
- Work on building up a good credit score in the 700s or higher, if possible.
- Create a will and get life insurance.
- Maximize the match on employer-sponsored retirement plans.
- Put 20% down on a home.
- Build kids' education savings funds.
Retirement savings by age 30: Some experts recommend having two to three times your annual salary saved.
Financial goals for your 40s
- Maximize personal contributions to retirement accounts, such as Roth and Traditional IRAs.
- Increase income (negotiate a raise or add an income stream).
- Consider additional investments to help diversify your portfolio.
- Pay extra on your mortgage, and consider paying it off early.
- Discuss your parents' finances and estate plans.
- Map out college payment options with your kids (without touching retirement savings).
Retirement savings by age 40: Some experts recommend making extra contributions and having six times your annual salary saved.
Financial goals for your 50s
- Take advantage of catch-up contributions.
- Get long-term care insurance.
- Check on your investment portfolio regularly, looking for ways to maximize value.
- Look into financial advisors who can help you manage your situation.
- Get educated on Medicare, Social Security and other retirement benefits.
- Increase your contributions to your 401(k) plan now that you can use the over 50 tax advantage.
- Put aside medical savings and maximize your health savings account.
- Revisit your will.
Retirement savings by age 50: Some experts recommend having seven to eight times your annual salary saved.
Financial goals for your 60s
- Finish paying off all remaining debt, including your mortgage.
- Make retirement plans and tweak contributions based on what you can afford.
- Plan out a retirement income strategy.
- Decide when to take Social Security and enroll in Medicare.
- Think about downsizing or selling off unneeded assets.
- Finalize an estate plan.
Retirement savings by age 60: Some experts recommend having 10 times your annual salary saved.
Important at all ages
Planning is important at each stage of life and age. Talk with a financial professional who can help you adjust goals and strategies to your specific lifestyle.
