Take Charge of Wealth + Health in Your 30s and 40s

Why It Matters:

  • No matter how busy you get, it's important to look after your finances and your health.
  • Depending on your age, there are different areas that will need your attention.
  • Use this article to help guide your financial and physical wellness in your 30s and 40s.

Transamerica tkc.profilePicture Written by: Transamerica | Transamerica
Dec. 03, 2019

3-5 Min readClock Icon

We all have to do a little financial and fitness maintenance from time to time. We keep an eye on our weight, our credit card balance, our grocery bill, and we do our best to make it in for our annual checkup. But within the confines of busy modern life, even a little maintenance can get overwhelming. How can we know we’re doing the right thing at the right time? Here are some suggestions to help get you started.

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Wealth + Health in your 30s

As we age, it’s important to keep in mind how our health impacts our wealth, especially in the current landscape of healthcare costs. We call it the Wealth + HealthSM connection. Your 30s can be a time to form habits that will serve you well the rest of your life. Many 30-somethings build on life experience from their adolescence and 20s to make serious decisions about where they’re going in the world and how they’re going to get there.

Be the CEO of your stress and anxiety

Whether new issues have recently come up, or issues left over from your adolescence and 20s are still needing attention, letting stress and anxiety run amok can not only make you less happy, it can affect your financial and physical well-being for the rest of your life.

Managing stress

According to the American Psychological Association (APA), the proportion of Americans who say they’re experiencing stress about specific issues has risen over the past year.1 If you’re among the growing number of Americans experiencing higher stress, you might want to take note of how stress can affect your health and your finances.

One MIT study reported chronic stress could cause higher instances of risky decision-making.2 This could translate into making poor financial decisions, and even worse choices when the stakes are especially high. Plus, the Mayo Clinic says, stress can put you at increased risk of many health problems, including anxiety, depression, digestive problems, headaches, heart disease, sleep problems, weight gain, and memory and concentration impairment. It can also have negative effects on the male and female reproductive system.3 Maybe not what you need when your reproductive body clock starts ticking during this decade.

The APA offers these five tips to help manage stress: take a break from the stressor, exercise, smile and laugh, get social support, and meditate.4 Find what works for you and build an arsenal of coping mechanisms to lean on for years to come.

Get promoted, get new skills, or get moving

In your 30s you’re probably making moves to increase your earning potential. It may seem obvious, but this means having more money for investments, kids’ college tuition, life experiences, and more.

Life in the fast lane

One way to increase your earning potential is to focus on getting promoted early on in your career. After all, most people don’t go from Sales Associate to CEO overnight. You have to start somewhere. Making persuasive arguments for higher pay could prove very important for your overall quality of life. In fact, even a small annual increase could lead to a $750,000 dollar difference in lifetime earnings.5

Own your education

You can also invest in your future earning power by learning new skills that might allow for career growth down the road. This could mean going back to school or spending extra time at work becoming an expert in some specialization.

Know when to quit

In some cases, the right answer might be to simply move on. Some jobs may not have the growth potential you’re looking for. Others might not value new skills or creativity. And some jobs might leave you dreading your position for the rest of your working days. You want to make sure you’re setting yourself up for a career and a salary that will maximize your potential, financially as well as being satisfiying for your mental health and personal fulfillment.

Invest in stocks

There’s no such thing as a sure thing, and the stock market can be a volatile place year to year, sometimes even performing poorly for a decade at a time. But folks in their 30s might want to consider a little thing called average market returns. In the most basic sense, that’s the average of how much money your money would make in the stock market over a period of time. And the average market return in the S&P 500® (the 500 most widely-traded stocks in the U.S.) from 1973 to 2016 was 11.69 %.6 Not a bad rate of return. Be sure to consider your investment objectives and risks. Past performance is no guarantee of future results.

Put time in your corner

Investing your money means taking on a certain element of risk, but that risk played out over time has been shown to pay off. One figure you should pay attention to is the 30-year S&P 500® average return. If you start investing in your 30s and plan to retire in your 60s, you want to know how that market has historically performed over different 30-year time periods. The good news: it’s performed consistently well, despite volatile political and economic events.7 That means, given time (which you have), you can most likely grow your money for the future.

Routine, routine, routine

With your body starting to show signs of aging unprecedented in your 20s (goodbye, tacos at 2 a.m), and the state of your bank account turning from funny to frightening, it might be time to put self-care at the top of your to-do list.

Just like investing your money early, starting good Wealth + Health habits now could pay dividends later in life. The key is to make everything, from saving to stretching, part of your normal routine.

Money

Online tools, whether from your bank or a third-party app, can help automate your budget, savings, and bill paying. And if you’re able to make a habit of doubling down on paying off debt, the benefits can be rewarding.

Movement

Getting into an exercise routine can have multiple benefits, including controlling weight, combatting health conditions and diseases, improving mood, boosting energy, promoting better sleep, and providing a fun social activity.8 Exercise doesn’t need to be expensive or become a full-time endeavor. There are ways to make it work within your schedule and budget.

Medical Experts
Now might be a good time to listen to what your doctors have to say. Make those follow-up appointments, annual checkups, and take care of any issues coming up. Plus, get to know your family’s health history for symptoms to watch for. Advocating for your health and following the doctor’s orders could save you money on medical bills down the road.

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Wealth + Health in Your 40s

In your 40s, you’re likely doing that difficult dance between the increasing demands of work, the challenges of parenting, and the task of taking care of your own parents. Meanwhile your body might also start to feel the years. It’s hard to know where to begin dealing with all the responsibility.

Prioritize

Between retirement planning, saving for your kids’ college tuition, raising those kids, paying off debt, succeeding in your career, looking after your 40-something body, and taking care of a home — all while trying to maintain a work-life balance — learning to prioritize can help you be your best self.

You are your most valuable asset

First of all, without you, none of these important things will get done. So it’s probably best to start by keeping yourself physically and mentally healthy. With your busy schedule, you might wonder whether you have any time to look after your body and your mind. Ultimately, it’s up to you to balance your needs with your to-do list, but here’s a tip that might help: Exercise in the morning. This could not only give you access to the mood-lifting and wealth-building benefits of exercise right at the start of your day, but it might help with prioritization. Chances are there will be fewer distractions and potential excuses in the morning. Plus, a recent study found that people who exercised before breakfast burned double the amount of fat of people who exercised after breakfast.9

Think retirement

One of the biggest tests of your financial priorities will be balancing retirement and college savings. If your circumstances force you into choosing between saving for retirement and funding your children’s tuition, it’s a tough decision. Most sage financial wisdom says you should think about it this way: You can borrow money for tuition, but you can’t borrow money for retirement. This is a big choice and might best be made with the help of a trusted financial professional. If you ultimately choose to divert some retirement contributions towards tuition savings, keep in mind you will be able to make catch-up contributions when you reach your 50s.

Make sure you’re well covered

While this tip can also apply to 30-somethings with families and more career maturity, your 40s will generally be the time when your earning power, expenses, and assets start outgrowing your insurance coverage. Whether home, auto, life, or health insurance, contact your insurance agents and review your coverage to make sure you and your family have the right amount of coverage for your assets.

Seek guidance

As a 40-something, there’s no need to be an island. As the stresses of serious adulthood come knocking, you might want (or even need) a team behind you to help.

Financial Planner

Since so many of your responsibilities revolve around making solid financial decisions, it might be a good idea to find a financial professional you can lean on. The Wall Street Journal recommends looking for a certified financial planner (CFP®), someone who is licensed and regulated.10 You should also consider whether or not they earn money on commission to avoid being steered in a particular direction that meets their quota. Flat hourly fees are generally preferred. And their code of ethics should contain language that requires them to look after your best interests.

Primary Care

There are lots of benefits to having a doctor who knows your history and can help you work toward a comprehensive plan for staying healthy, including potentially lower healthcare costs. It might also be helpful to work with someone to develop a personalized fitness plan. If not a personal trainer, at the very least, find a workout buddy to hold you accountable and keep you coming back for more.

Friends

And speaking of friends, maintaining your close friendships in your 40s (and beyond) can be a great way to keep a solid support system behind you. Plus, close personal relationships have been shown to have huge health benefits.11 One more reason to buddy up.


Things to Consider:

  • Use this article to inform your Wealth + Health decisions in your 30s and 40s.
  • Don’t forget to consult with trusted professionals about your Wealth + Health.
  • Invest in lifelong habits that contribute to the well-being of your body and your bank account.
 
 

1 “Stress in AmericaTM 2019,” American Psychological Association, November 2019

2 Stress Can Lead to Risky Decisions,” MIT News, November 2017

3 “Chronic Stress Puts Your Health at Risk,” Mayo Clinic, March 2019

4 “Five Tips to Help Manage Stress,” American Psychological Association, accessed November 2019

5 “64% of Job Seekers Make This Mistake, and it Could Cost You $750,000 Over the Course of Your Career,” CNBC, December 2018

6 “20 Years of Stock Market Returns, by Calendar Year,” The Balance, December 2018

7 “Deconstructing 30 Year Stock Market Returns,” A Wealth of Common Sense, May 2016

8 “Exercise: 7 Benefits of Regular Physical Activity,” Mayo Clinic, May 2019

9 “Increase Health Benefits of Exercise by Working Out Before Breakfast,” Science Daily, October 2019

10 “How to Choose a Financial Planner,” Wall Street Journal, accessed November 2019

11 “The Health Benefits of Strong Relationships,” Harvard Women’s Health Watch, August 2019

Certified Financial Planner Board of Standards Inc. owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™, CFP® (with plaque design) and CFP® (with flame design) in the U.S., which it awards to individuals who successfully complete CFP Board's initial and ongoing certification requirements.



Neither Transamerica nor its agents or representatives may provide 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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