Financially Fit &Fabulous: Savings goals in your 20's and 30'sMonday, April 19, 2021
SOMETIMES, younger women may believe that they have time on their side and that they can afford to postpone saving for more pleasurable pursuits with their money. However, the choices you make early in your working life can greatly affect your ability to succeed in later years.
If you are in your 20's or 30's and you wish to get the right start to secure your financial future, here are some savings objectives that you should be thinking about at this time:
Build an emergency fund
Your first goal should be to amass 3 - 6 months' living expenses in an account that will provide a cushion in the event of emergencies such as illness, job loss, or natural disasters. Establishing a 'rainy day' fund will give you a solid foundation upon which to build your wealth.
Reduce student debt
If you had to take out loans to get through University, you should work towards eliminating this debt. Make spending sacrifices so that you can use more of your disposable income for extra loan payments, or to create a savings pool to make a lump sum payout.
Contribute to a retirement fund
Although retirement may seem like a distant goal, the best time for you to start planning for this objective is at the start of your career. Become a member of an approved retirement scheme, whether at your workplace or through a privately registered pension fund.
Plan for home acquisition
Another objective that you should have at this time is saving towards the deposit on a home. Create a specific goal that outlines the cost of the property and a timeline in which you hope to acquire it, and then establish a savings plan that will help you to attain your dream.
Start children's education fund
Once you have started your family, you need to plan for your children's future education. The sooner you establish a dedicated savings account for their college costs, the easier it will be for you to accomplish your objective of giving them the very best education.
Balance lifestyle desires
While you plan for future goals, you will also want to attain short-term objectives such as buying a vehicle. If possible, try to finance some of these acquisitions from savings instead of opting for large loans. This will keep you focused on building long-term assets with your money.
Take on some investing risks
At this stage, you should be willing to consider more aggressive investment options that can help you to create wealth faster. Don't just settle for passive savings; speak to a Scotia advisor who can guide you in creating the right portfolio which can help you to achieve your goals.
Start an insurance policy
In life, you may be faced with certain unforeseen tragedies such as injury, critical illness, permanent disability, even death. When you purchase your insurance policy early, you can set aside a manageable amount each month; in the event of a tragedy you or your family's financial stress will be reduced, and much focus can be placed on recovery and rebuilding your lives. Before long you'll be glad you made the choice.
Establish an entertainment budget
Last, but by no means least, it is important to set aside a monthly budget for entertainment. This includes fun stuff such as dining out, staycations, travelling etc. Establishing an entertainment budget can save you money in the long run and remember – you don't need to spend tons of money to have a good time.
Start your journey today!
Kim-Moya Dawkins is a licensed Investment Advisor from Scotia Investments Jamaica Limited
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