When it comes to finances, it is important to have a plan in place – especially for long-term goals. According to Cody Biggs, while it can be difficult to know exactly where to start, a good place to begin is by setting financial milestones for each decade of your life.
Cody Biggs Lists Financial Milestones To Aim For By Each Decade Of Your Life
In your 20s, it may seem like you have all the time in the world to figure out your finances, says Cody Biggs. However, this is actually the perfect time to lay the groundwork for your financial future. First and foremost, it is essential to establish good saving habits. Experts recommend saving at least 20% of your income, and in your 20s, you can start small by putting aside just 10%. It is also wise to begin contributing to a retirement account, such as a 401(k) or IRA. These accounts allow your money to grow tax-free, which means you will have more money saved in the long run. Another milestone to aim for in your 20s is paying off any high-interest debt, such as credit card balances or student loans. By doing so, you will set yourself up for financial success in your 30s and beyond.
As you move into your 30s, your finances may become more complex. This is a time when many people begin to earn more money, start families, and purchase homes. One milestone to aim for in your 30s is to have a fully-funded emergency savings account. This means having enough money saved to cover six to twelve months’ worth of living expenses. It is also important to reassess your retirement contributions and increase them as necessary to ensure you are on track to meet your long-term goals. Additionally, this is a good time to purchase life insurance to protect your family in case of an unexpected event.
By your 40s, you should have a solid financial foundation in place. It is important to continue saving for retirement and contributing the maximum amount allowed to your retirement accounts. Another milestone to aim for in your 40s is to pay off your mortgage early. This can be done by making extra payments on your principal balance or by refinancing to a shorter-term loan. By doing so, you will save money on interest and free up more cash flow in your budget.
As you approach your 50s, retirement is likely on the horizon. One milestone to aim for during this decade is to have a retirement plan in place. This includes working with a financial planner to determine how much money you will need in retirement and coming up with a plan to achieve that goal. It is also important to pay off any remaining debt, as this will reduce your monthly expenses and allow you to stretch your retirement savings further.
Finally, in your 60s and beyond, it is essential to focus on preserving your retirement savings. According to Cody Biggs, this means minimizing your investment risk and focusing on income-producing assets to provide a steady stream of cash flow. Another milestone to aim for in your later years is to create an estate plan to ensure your assets are distributed according to your wishes.
Cody Biggs’s Concluding Thoughts
In conclusion, setting financial milestones for each decade of your life is an important part of achieving long-term financial success, says Cody Biggs. By following these guidelines, you can establish good financial habits that will serve you well throughout your entire life. Remember, it’s never too early – or too late – to start planning for your financial future.