Recently, a client asked me if I thought that she had achieved all the appropriate financial targets for her age. Like a concerned parent eagerly checking for the age-specific developmental achievements of a child, she was trying to assess if she had attained the money milestones that would indicate that she was on the right track.

However, just like children who progress at their own pace, each person is unique when it comes to their personal financial development. Some people seem to be born with the right genes for money, getting an early start on wealth creation by being consistent savers and savvy investors. Others appear to be slow learners, remaining deficient with their money skills until their later years.

Despite the disparity in development, there are basic money milestones that can be used as a guide to people’s financial health and well-being. Let’s examine some of the signposts to look for as you move along your financial life journey:

Age 20-35: Getting organised with money

You start this stage of your financial life cycle when you leave school and gain your first job. At this point you may be unsure of the right moves to make financially. Your income might barely be enough to cover your basic expenses, and you most likely would have to borrow to meet your short-term goals such as owning a car or furnishing your home. You might just be starting a family, which would increase your financial responsibilities.

As you are finally getting the chance to make your own financial decisions, your focus should be on learning how to effectively manage your money. If you practise prudent money habits such as budgeting to live within your means, saving a percentage of your income, and not using debt to finance your lifestyle, then you will have set the right precedent for attaining important goals such as home ownership.

Age 35-50: Focusing on accumulating money

At this point, you should be more seasoned in money management. You may have obtained a home with the help of a mortgage, and if you have children, a large part of your earnings would be going towards meeting their needs. Your income should be sufficient to pay your bills, but you may not have adequate surplus funds to be invested towards major goals such as your children’s college tuition and retirement.

Your main objectives at this stage should be to earn more money and invest your income to build wealth. If you are employed, look out for opportunities to earn part-time income by using your talents or providing products and services that meet people’s needs. Read books and take courses that can guide you on smart investment choices. Depending on your overall goals, you may need to consider starting your own business to increase your earning potential.

Age 50-65: Consolidating your financial position

As you grow older, you should be moving towards a position where your income sources are in excess of your spending needs. Your children should be finishing higher level education, or should already be able to support themselves. Major expenses such as car payments or a mortgage loan should be finished by the time you exit this stage of development.

If you had started saving towards retirement from your early working years, at this time you could concentrate on monitoring your investments to see if they are progressing according to plan. If not, you will have to put more emphasis on supplementing your income sources to address potential shortfalls in your nest egg. You also need to avoid money risks by ensuring that you have adequate insurance and steer clear of dubious investment schemes.

Post 65: Preserving and passing on wealth

In this retirement phase of your financial life cycle, you get to live off the accumulated wealth that you generated during your working years. You may choose to, or be forced to, continue working if your investments cannot meet your needs. While children’s expenses and mortgage payments should be a thing of the past, health-care costs may be one of your major concerns. You must also be mindful of the negative effects of inflation on the value of your nest egg.

You should already have made plans for passing on your estate, so review the beneficiaries on your insurance policies and ensure that your will reflects your current wishes. A power of attorney and other legal documents might be necessary in case of incapacitation. If you have amassed significant wealth, look at establishing a trust to preserve your money from excessive estate taxes.

What if your current position doesn’t fit into these suggested guidelines? If you’re almost 50 and haven’t even started the money management stage yet, all is not lost. You will have to put a lot of effort into learning the basic money principles and earning more income to make up for lost time.

Your Money is celebrating its own milestone today, as this issue marks the fourth anniversary of the column. Thanks to all my faithful readers for your comments and support and the Jamaica Observer for partnering with me to provide you with practical financial advice.

Cherryl is a financial consultant and money coach, and founder of Financially S.M.A.R.T. Services; she is currently writing her first book, The 3 Ms of Money. Get free financial tools at www.financiallysmartonline.com and practical financial articles at www.financiallysmartadvice.com. Please email comments to advice@financiallysmartonline.com