The Financial Milestones to Aim for Before You’re 30

updated May 3, 2019
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Ah, your 20s! That golden decade of finding yourself personally, professionally, and, well… if you’re smart—financially.

Sure, figuring out your money situation might not be the most enjoyable part of being in your 20s, but arguably, it might be the most important. It’s never too early to start thinking about your future, and chances are you’ve already set some lofty goals for your life—like buying a home of your own, starting a business or taking a once-in-a-lifetime vacation.

To help you get there, here are six important milestones to hit before you celebrate your Dirty 30:

1. Save 18% of your annual income to your 401K

If haven’t already started your retirement fund, it’s definitely time to start. If your employer matches a percentage of it, it’s basically free money! According to Fidelity, if you start allocating 18% a year to your 401K now (including what your employer matches), you should have enough to retire by age 67 (if you started at 25, 15% should be sufficient).

(Image credit: William Strawser)

Just having a 401K is a good start. But it’s what you do with it that has a major impact on your retirement.

2. Put a dent in your debt

Credit card loans and student debt still following you? Make a plan to get rid of it—starting with the credit cards that have the highest interest rates. Or, try the snowball method and attack your smallest debts first. Whatever gets you motivated.

3. Save up for a rainy day

Vanguard suggests that you stash away at least three months’ (and up to six months) worth of living expenses in case of emergency. That means housing, food, health care, utilities, transportation, and any other bills or payments.

4. Get credit where good credit is due

Do you know what your credit score is? If it’s not considered good (so, you’re somewhere under 700), it’s time to get strict about paying your bills on time and chipping away at those credit card balances.

5. Be financially independent

Are mom and dad still footing your phone bill? It might finally be time to break free of these ties—you’ll be surprised how liberating it feels to be supporting yourself 100 percent.

6. Invest!

Start a beginner investment portfolio through the set-it-and-forget-it model: At age 30, Lifehacker suggests putting 80 percent of your portfolio in stocks, and 20 percent in bonds. As you age, you slowly move from stocks to bonds, meaning your portfolio becomes less risky over time (find far more detailed instructions to creating a starter portfolio here).

Before you start panicking, remember that life happens. If you have to put your 401k on hold to pay off your student loans, or take an entry-level job to get your foot in the door of the industry you want to work in, then do it. Because building a worthwhile career for yourself is one of the most important investments you can make! Happy saving!