Smart Money Moves for your 20s and 30s



When you are in your 20’s and 30’s it seems like you have endless financial demands that are pulling your hard earned money in every direction. Take comfort that you are not alone: your friends, your family and your co-workers have the same struggles. This is a time in life when life events pile on one after another. Starting families, purchasing a first home or a first car, starting to save for retirement, managing debt from student loans and credit cards, starting a college savings plan, all the while trying to enjoy life with an active lifestyle. Regardless of your particular situation, here are 10 smart money moves for millennials:

1.      Set financial goals – Decide what it is that you really want your money to accomplish for you, determine how much it will cost and how much you need to dedicate each month to reach your goals. Setting goals gives meaning and purpose to each spending and saving decision. When you have assigned purpose for the money in your possession, it becomes easier to make a good decision when you would otherwise spend money on that extra tool when you know that money is helping you accomplish your personal or family goals. 

2.      Revisit your spending plan (Notice we did not call it a budget) – Yes, it is great that you made a spending plan, but how long has it been since you have reviewed it? It is best to get in the practice of revisiting your spending plan every year or every time you have a major life change. Here are some good questions to ask yourself as you evaluate:

  • Does your current spending plan support your goals?
  • When is the last time you shopped for better prices on recurring expenses such as internet and insurance? 
  • What items are you spending money on each month that can be eliminated? 
  • How much can we increase what we automatically deposited into our savings each month? 

Ignoring this can extend how long it takes to accomplish your goals.  

3.    Take the free money – Most employer retirement plans offer some level of match when you are contributing, if you haven’t taken the time to enroll, you are leaving free money on the table. If your employer doesn’t offer a plan, look to set up a Roth or Traditional IRA where you can start saving for your retirement with regular scheduled deposits each pay period. At least annually, review how your money is invested in your retirement account.  Remember, you still have 30+ years before you need this money in retirement, so look to take advantage of more aggressive funds that carry the potential of bigger returns. 

4.     Plan for the worst- Estate planning may sound like something you address when you are old and have extra money but it is a foundational component for people in every stage of life. If you have not met with an attorney to talk through and put into writing who you would like to make your financial or health care decisions if you were disabled or incapacitated, or who will take care of your family and assets if you passed away, this should be one of your top priorities.  

5.    Pay off debt and increase emergency fund –Start by writing down each of your debts with its minimum monthly payment and interest rate. Now, create a debt repayment plan by ordering the loans you will pay off first either by highest interest rate or lowest balance. Put your plan into action by committing all your extra cash to paying off that first loan on your list. Once it is paid off, commit the same level of money to the next loan, moving down the list until all the loans are paid off. 

Once your loans are paid off continue to use all your extra money on building your emergency fund until you have three – six months of monthly expenses in savings. This will keep you afloat when an unexpected hardship comes your way. 

6.    Re-evaluate your career trajectory – Whether you love where you work, are miserable or somewhere in between, it is always good to be thinking about the future. The most valuable asset a young professional has is their future earnings potential. Talk with a trusted advisor or mentor to consider your options. Maybe you like what you do but need to take more initiative with your boss or projects to experience the desired growth with your current company.  You might have always wanted to try a certain career but you need more training/schooling. Come up with a detailed plan and commit to accomplishing each step that will get you to the position and income you want to have.  

7.    Evaluate insurance coverage – It is always important to have the proper amount of health, personal liability, auto and renter’s or homeowners insurance. Find an insurance agent you trust to review if your coverage is adequate for all areas of your life and if you can benefit from lower prices. If others depend on your income, you need life insurance to replace it should you die. Term life is an inexpensive way to provide a high level of protection for your loved ones. Also, if you are the main breadwinner you should strongly consider disability insurance to replace your income in the event you can’t work.

8.    Monitor and improve your credit - Each year check your credit report for free at This allows you to see your credit report from each of the three credit bureaus. While this doesn’t give you access to your credit score, checking your report could help you correct errors, discover an identity thief at work or spot delinquent accounts. If you would like a free look at your estimated score you can use a site like Bad credit can affect your insurance rates, mortgage rate or even your job application. 

9.     Save on your taxes –As your taxes graduate beyond just your own W-2, it is wise to seek a tax professional that can help you plan for your tax situation. Seek out a reasonably priced CPA – not a chain store who will help you take advantage of things like the savers credit, deducting student loan interest, mortgage interest and sales tax on big ticket items.  Your CPA can help you decide the appropriate deductions to claim on your W-4 and to evaluate special circumstances you might have like an adoption credit. Taxes should be planned for throughout the year, not just rushed through before April 15th. 

10.  Keep your eye on the prize - It is hard not to compare your situation to your friends, your neighbors or your co-workers. Stay grounded and devoted to accomplishing your personal and family goals. You can easily derail your progress when you start to compare your life to others and feel the pressure to live life more like them. Keep in mind that their family’s goals can be much different than yours and chances are your light years ahead of them with even having goals and a plan on how to accomplish them. Keep revisiting your goals and tracking your progress. Celebrating milestones will help you push through feelings of comparison when you know you’re living the life you work hard to enjoy.  

This material is intended to be educational in nature, and not as a recommendation of any particular strategy, approach, product or concept for any particular advisor or client.  These materials are not intended as any form of substitute for individualized investment advice.  The discussion is general in nature, and therefore not intended to recommend or endorse any asset class, security, or technical aspect of any security for the purpose of allowing a reader to use the approach on their own.  Before participating in any investment program or making any investment, clients as well as all other readers are encouraged to consult with their own professional advisers, including investment advisers and tax advisors.  Munn Wealth Management can assist in determining a suitable investment approach for a given individual, which may or may not closely resemble the strategies outlined herein.  1323AZS