How to Build Wealth in Your 30s

Building wealth in your 30s is crucial to securing your financial future. This decade of your life is the perfect time to lay the foundation for financial stability and work towards reaching your long-term financial goals. With the right strategy, discipline, and patience, you can create a solid financial foundation that will help you achieve financial freedom. These are some key steps you can take to build wealth in your 30s, including creating a budget, paying off debt, increasing income, and investing in a retirement plan.

Create a budget and stick to it

One of the most important steps to building wealth is having a good understanding of your finances. This means tracking your income and expenses and creating a budget. By having a clear understanding of how much money you are earning and spending each month, you can identify areas where you can reduce expenses and increase savings. Create a budget that works for you and stick to it. This will help you reduce debt, save money and set yourself up for financial stability.

Pay off high-interest debt

High-interest debt, such as credit card balances, car loans, and student loans, can be a hindrance to building wealth. The interest charges on these debts can add up quickly, so it's important to prioritize paying them off. Consider paying off the debt with the highest interest rate first, and then moving on to the next highest until you are debt-free. This will help you reduce the amount of interest you pay over time and free up more money to put toward building wealth.

Increase your income

Increasing your income is another way to build wealth in your 30s. Consider taking on additional work or finding ways to increase your income through freelance or side hustle opportunities. If you are employed, negotiate a raise or look for a higher-paying job that aligns with your skills and experience. By increasing your income, you will have more money to put towards saving and investing, which will help you build wealth faster.

Invest in a retirement plan

Investing in a retirement plan, such as a 401(k) or IRA, is one of the most important steps you can take to build wealth in your 30s. The earlier you start investing, the more time your money has to grow. Consider contributing to a retirement plan as early as possible, even if it's just a small amount each month. The rule of thumb is to save 15% of annual income (including any employer contributions) for retirement.

If your employer offers a 401k, make sure you’re taking full advantage of it. This is especially important if your employer matches retirement contributions since you’re basically leaving free money on the table if you don’t contribute up to their match limit.

If your employer doesn’t offer any retirement savings options, you can still contribute to a Traditional or Roth IRA. The contribution limit is $6,000 for 2022 and $6,500 for 2023.

Here’s a tip: If you haven’t maxed your retirement contribution yet for 2022, you still have time! You can contribute to your IRA for 2022 up until April 15th of 2023.

Allow your money to work for you

Seeing your money accumulate as you build savings can be so rewarding but over time, cash is only depreciating against inflation. You want your money to work for you, not against you. Start by keeping your emergency fund money in a high-yield savings account and then look for higher interest options for the money you are setting aside for time-specific goals, like a CD or structured product. For longer term goals, the stock market is a great way to build wealth over time. Consider investing in a diversified portfolio of stocks, bonds, and other securities. You can start with a small amount of money and gradually increase your investments as your wealth grows. Research stocks and other investments and consult with a financial advisor to help you make informed decisions.

Consider real estate

Real estate is another way to build wealth. Consider investing in rental properties, or you can invest in real estate investment trusts (REITs), which allow you to invest in a portfolio of properties without having to buy, manage, and sell individual properties. Real estate can be a valuable asset that provides a stable source of income, as well as the potential for appreciation over time.

Be mindful of expenses

Reducing expenses is another way to build wealth in your 30s. Be mindful of your spending and look for ways to reduce expenses. This could mean cutting back on eating out, reducing entertainment costs, or shopping for deals. By reducing your expenses, you can free up more money to put towards saving and investing.

Continuously educate yourself

Building wealth requires continuous education. Read books, attend seminars, and seek the advice of financial professionals to help you stay informed and make smart financial decisions. The financial landscape is constantly changing, so it's important to stay informed and adapt your financial strategies accordingly.

Building wealth takes time, but by taking these steps, you can create a strong financial foundation in your 30s. It's important to be patient and disciplined and to consistently make smart financial decisions to help you reach your financial goals.

Don’t feel like you have to do this alone- find an accountability partner! Share your goals with your partner, trusted friend, or your financial planner. We are here to provide support and help you manage complex goals and keep you on track. Connect with us to take the next step toward reaching your own infinite heights!

*The opinions voiced are for general information only and are not intended to provide specific advice or recommendations for any individual.