I was recently asked in an interview to list personal finance milestones in the 30s, 40s and 50s. Since personal finance is deeply personal, listing such milestones may cause anxiety in many who, due to personal circumstances, have had difficulty investing or saving like the rest of us.
I liked three questions on a related topic that were asked in another interview and would like to expound on them. What follows is generic and applicable only to typical money managers.
One money habit everyone should build in their 30s
Regular investing for long-term goals like retirement, children’s future, etc. Aim to invest at least 75% of your current essential expenses for retirement, and increase your investments by at least 5% to 10% each year.
Health consciousness is essential at this stage.
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One mistake people must avoid in their 40s
Getting into new debt for wants like a second home loan or a second car loan etc. Already having a home loan taken in the 30s would severely impact retirement planning, especially if borrowers rush to pre-close it. The last 30s and 40s should then be used for strengthening the retirement corpus. Any additional loan for wants in this period is a strict no-no.
One thing people should fix before they turn 50
The 50s represent the last decade of normal gainful employment. Retirement planning should be fully sorted by then, and one should invest an amount close to the required amount (use a calculator or ask AI!). All loans should ideally be close to completion.
It is also time to take extra care of our health and figure out how we will spend our time meaningfully after retirement.