What You Should Be Thinking About Financially In Your 20s & 30s

Why It Matters:

  • Life is full of important events that can also have financial implications.
  • Creating a solid financial foundation when you’re younger can help you through the lean times.
  • A good financial start is important in creating the kind of retirement you deserve.

Jeff Maciolek tkc.profilePicture Written by: Jeff Maciolek | Transamerica
May 15, 2019

5 Min readClock Icon

Life is full of important events. And each one brings with it a series of financial decisions that can affect your finances for years — or even decades — to come.

For those just starting out in their 20s and 30s, it can all seem a bit overwhelming at times. “Adulting” is a made-up word but represents a very real feeling when life presents you with the financial fork in the road. Mistakes are inevitable, but fortunately, time is on your side. Here are a few key life events where you’re likely to be faced with major financial decisions, and if you play your cards right, your future self will appreciate your discipline and foresight.

First job

You worked hard in school and now you’re ready to put those new skills to good use. And while it may be tempting to go out and celebrate that you’re no longer working summer or low-paying hourly jobs, it’s time to start firming up your financial foundation. You may be making more than you ever have before, but you probably also have more responsibilities than you’ve ever had before, too. Get started off on the right foot:

  • Consider meeting with a financial professional to help plan your financial future.
  • It’s not always all about the Benjamins. If you’re fortunate enough to be weighing job offers, look at an employer’s total benefits package, including health care, retirement plan, commuting costs, vacation days, etc. One job may pay more but cost more in the long run.
  • If you have debt, consider paying down the highest interest ones first so it doesn’t cost you even more over time.
  • If your employer offers a retirement plan, such as a 401(k) or 403(b), make sure you’re signed up. Try to contribute at least enough to get the full match from your employer.
  • Save for a rainy day. Cars break and layoffs happen. Take care of your future self by squirreling away at least three months of living expenses.
  • Work on building up your credit score by paying bills on time to help create the life you want to live.


Few things can affect your financial life more than tying the knot. While finances aren’t the most romantic topic surrounding the subject of marriage, they are a necessary conversation to help preserve the “happily ever after” part. Honesty and transparency are important pieces in any financial deal, and marriage is no different. But here are some other money matters to think about when you’re ready to finally walk down the aisle:

  • Check with a financial professional to ensure you have adequate life and disability insurance.
  • Update other insurance policies to include all new family members, if needed.
  • Add your spouse as a beneficiary on your life insurance policies and retirement accounts.
  • Consider creating/updating a will to insure your final wishes are known.
  • Discuss your short- and long-term financial plans so you can understand each other’s goals.
  • Max out 401(k) contributions if and while you can. Kids and additional responsibilities only make saving more difficult.

Buying a home

It’ll probably be the largest item in your budget. So obviously something as major as purchasing a home can have an enormous effect on your finances. In many cases it’s a 30-year commitment that’s likely to increase in value, but also has the potential to decrease, leaving you owing more than it’s worth. Buying a home also involves much more than just the cost of the house. It entails property taxes, loan interest, home insurance, HOA fees, closing costs, utilities, maintenance, and more. Here are a few things to consider to keep you from becoming house-rich but cash-poor:

  • Check with a financial professional to see how much home you can actually afford versus how much you qualify for. The difference can greatly affect your quality of life and ability to save for retirement.
  • Make sure you have enough life insurance to help pay off your mortgage should the worst happen.
  • Evaluate if you have enough disability insurance to continue making mortgage payments in the event you or your spouse are unable to work for an extended period of time.
  • Don’t raid your retirement funds to help with the down payment; save up for it.
  • Consider if you have enough in savings to pay for surprise home repairs and ongoing maintenance costs.

Having or adopting children

Kids are cute, incredibly rewarding, and deliver countless hours of joy. Yet starting a family also brings with it years of financial responsibility. According to the U.S. Department of Agriculture’s most recent numbers, it’s estimated that for a child born in 2015, a middle-income married-couple family will spend $233,610 from birth through age 17 on child-rearing expenses.1 But with some careful planning and good budgeting, at least your finances will be one less thing to keep you up at night. Here are some things to consider when starting a family:

  • Consider whether both of you will work or if one of you becomes a stay-at-home parent. Often the cost of full-time day care can be nearly as much as your rent or mortgage.
  • If you haven’t already, create a will to designate who will raise the child(ren) and handle finances if you’re not around.
  • See if your employer offers a dependent care flexible spending account (FSA) to use on day care.
  • Start saving for college early. Look at your state’s 529 plan to see if there are tax advantages.
  • Make sure you have enough life insurance to help raise your child(ren) in the unlikely event you’re no longer around. While you’re at it, double check that your beneficiary information is up to date.
  • Think about purchasing a smaller life insurance policy for each child to protect their insurability down the road.

Get guidance

When you’re just starting out, few individuals have the knowledge or expertise to navigate all the financial challenges and additional responsibilities life throws at you. There is no all-encompassing course or class that can teach you everything you need to know about finances. That’s why it’s always a good idea to talk to a financial professional to help you plan for financial success down the road and protect your quality of life.

Things to Consider:

  • Find a good financial professional that would be willing to speak to someone just starting out.
  • It’s OK to make short-term decisions, but keep the long term in mind.
  • Save early and often. Even a little bit here and there can turn into something more impressive with time and compound interest.

1 “Families Projected to Spend an Average of $233,610 Raising a Child Born in 2015,” U.S. Department of Agriculture, 2017

Neither Transamerica nor its agents or representatives may provide medical, tax, investment, or legal advice. Anyone to whom this material is promoted, marketed, or recommended should consult with and rely on their own independent tax and legal advisors and financial professional regarding their particular situation and the concepts presented herein.



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