Financial To-Dos For Your 20s, 30s, And 40s

When people start to talk to us about fiscal responsibility, our eyes tend to glaze over, even as fully-fledged adults; however, in an insecure economy, creating some semblance of financial security can alleviate a lot of stress and, in doing so, improve life dramatically. As many of us live paycheck to paycheck, the idea of paying off debts can seem overwhelming, let alone saving or even investing money. The truth is, however, it’s not as difficult as it sounds, as long as you start early and are strategic and measured in your efforts. Here, a step-by-step guide to making the best financial choices for your future in your 20s, 30s, and 40s.

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A Financial Checklist For Your 20s, 30s, and 40s

Unless you're working in one of these fields, chances are that you're not making all that much money in your twenties. That said, your twenties tend to be the decade of life in which you have the fewest financial responsibilities, which means it's a good time to lay the foundation for your entire financial future. Click through for the 4 most important to-dos of the decade.

Make this your number one priority. Test it out for a few months to see how reasonable it is, and make adjustments for whatever isn't working. Then, automate as much as possible, so that bills are automatically paid and any savings are automatically siphoned off. To help in this endeavor, we absolutely swear by the EveryDollar app.

Your ultimate goal is to have six months worth of expenses in the bank; however, we suggest you start by aiming for one month's worth. Prioritize this fund before paying down debt, as if an emergency does occur and you are not financially prepared for it, chances are you will end up incurring debt anyway. To best enable these savings, set up a direct deposit from your paycheck into a high-yield savings account.

Once you've got a month's worth of expenses squirreled away in the bank, start paying more than the minimum payment–as much as you can possibly budget for–towards your credit card debt with the highest interest rate. Continue to pay the minimum payment on any other cards. Once your costliest card is paid off, you can focus on the next costliest, and so on until all of your credit card debt is gone.

Aim to contribute 5% of your gross income, with a 1% increase every six months. If your employer offers a match, prioritize contributing enough to maximize the match–it's free money! According to some estimates, a 25-year-old who puts away $600 a year will have $72k saved up by the age of 65.

If you're already in your thirties and are now having a panic attack because you've yet to accomplish any of the goals we just set forth for those in their twenties, do not despair. It might be a bit tougher to get started now, as you likely have greater financial responsibilities than you had in your twenties, but it's not at all too late. Make setting a budget, creating an emergency fund, paying down bad debt, and starting to save for retirement your first priorities before focusing on the following to-dos for your thirties.

If you're in a serious relationship that appears to be headed towards marriage, now is the time to discuss financials with your significant other. Here is our guide for doing so.

Chances are that the interest rate on your student loans is lower than any interest you may be paying on credit card debt, so be sure to continue to prioritize the latter over the former. Once your credit cards are paid off, however, you can evaluate your student loan debt to determine whether or not you should be paying more than the minimum each month. If your rate is over 5% or more, the answer is yes, you should attempt to pay as much as you can responsibly budget for each month. If it's around 4% or lower, you're fine to continue making the minimum payment.

As kids are likely to enter into the picture at some point in your thirties, it's important to start considering their future as well as your own; however, we do not recommend prioritizing this savings account over saving for your own retirement, as you can always borrow money to pay for tuition (whereas you cannot borrow money for retirement). If you've got your retirement savings handled each month, however, you should attempt to start a 529 plan. Those you buy directly from the state tend to have the lowest fees associated with them.

We know what you're thinking–home ownership these days is a pipe dream, and how in the world should you be saving for it when you have all of these other things you're supposed to be spending on? When buying a home, however, it's important to put as much down as you possibly can, so you'll want to have a sizable nest egg saved up before even considering taking on a mortgage. Our best advice for enabling yourself to squirrel funds into this bucket? Don't inflate your lifestyle to match your salary increases as you enter into your thirties. If home ownership is a priority for you at some point, could you continue to drive the slightly-less-nice automobile you drove in your twenties into your thirties? Could you cook more and eat out less? Could you be avoiding some of the luxury expenses you're tempted to indulge in now that you're making more money (e.g. ordering via Seamless or Postmates every other night)? These restrictions may afford you what seem like small savings, but every penny counts!

Once you've achieved the goals we've set forth for your thirties, you can move on to the following to-dos for your forties.

Your financial responsibilities at this point are likely to be pretty intense. Enlist the help of a fee-only financial advisor in assessing where you're at and how to move towards where you want to be.

The money you were using to pay down debts in your twenties and thirties should be freed up by now. You'd probably like to reward yourself with an increased shopping allowance, but we're going to go ahead and suggest you instead funnel that money into your retirement account. You should be maximizing contributions to your 401(k) and IRA at this point. You should also aim to increase your emergency fund to match your updated expenses.

These are prime working years, so it might be wise to look for ways to maximize your earnings outside of your main gig. Look for consulting or freelance work if time permits, but don't do so at the expense of your sanity.

If, by some miracle, there is room left in your budget after ticking off all of the steps mentioned prior, now is the time to begin investing whatever funds you can into a diverse stock portfolio. We suggest enlisting the help of a professional in doing so, unless you have a special knack for financial gambling. (Note: If you can find room for this in your budget prior to your forties you, by all means, should start as early as possible!)