5 Pieces of Financial Wisdom We Wish We Knew in Our 40s
A few months ago, we shared the biggest things we wish we knew about finances when we were in our 30s. But if you’re approaching 40, you might be wondering what financial tips you’ve been missing out on. It’s crazy to think about it but in your 40s, you’re about half way (or more) to retirement! If you haven’t already, now is the time to start making smart financial decisions for your future.
At Prometheus Private Advisory Group, we believe it’s never too late to think about financial planning. While it’s always better to start as soon as possible, you can still set yourself up for financial longevity at any age. If you’re not sure where to start, keep reading. Here, Vancouver’s financial advisors are sharing all their financial secrets for your 40s and beyond.
1. Don’t Be Afraid to Use Your Credit Cards
… as long as you pay them off! When used wisely, your credit cards can be a valuable part of your financial plan. From cashback and travel rewards to dining and retail credits, there are so many ways to make your credit cards work for you. It can make some people nervous to throw everything on their credit card, especially if you’ve struggled with debt in the past. But there’s nothing wrong with using your credit card for all of your purchases, as long as you pay it off each month before you’re charged interest. In your 40s, you know by now how much you can afford. When it comes to using your credit cards, it’s all about only spending within your means.
2. Increase Your Retirement Contributions
In a perfect world, you already have a retirement plan by the time you reach your 40s. After all, retirement isn’t all that far away so it’s a good idea to be prepared for life after work. Assuming you have a retirement savings plan, consider upping your contributions or reevaluating your account. Are you getting the most out of your retirement savings? Are you earning more than you were in your 30s? Now is the time to maximize your savings potential so you can enjoy your retirement to the fullest.
3. Buy Life Insurance
If you haven’t already thought about life insurance, your 40s are the perfect time to finally lock down a policy. The earlier you get life insurance, the better. Why? Monthly premiums are lower the younger you are because you’re less likely to have pre-existing health conditions. So while it’s never too late to get life insurance, it’s best to do it now. Life insurance is a valuable way to secure your family’s financial stability after you’re gone and will give you peace of mind knowing your loved ones will be taken care of.
4. Do a Monthly (Financial) Cleanse
No, we don’t mean you should stock up on green juice or bone broth. We’re talking about taking stock of your monthly expenses and cleansing yourself of the non-essentials. Are you really using that annual subscription for online yoga? Do you really need Netflix and Crave and Amazon Prime? If you use all of those things, great! You don’t need to get rid of things that are actually important to you. But all of those seemingly little expenses can add up to big costs, often without your realizing because they tend to be automatic charges. It’s worth taking the time to do a self-audit so you know what you’re really spending each month.
5. Get Paid What You’re Worth
By the time you’re in your 40s, you’re probably well into your career (but if you’re still figuring things out or switching gears, that’s totally cool too!). You’ve been working hard for the better part of two decades and you’ve earned your place in the working world. If you’ve been at the same company for a while or don’t feel like you’re making as much as you should be, stand up for yourself and ask for a raise. Not only will getting paid what you’re worth make you a better employee, it will also allow you to level up your retirement savings. Win win.
Not sure how to ask for a raise? Start by doing market research to find out what others in your position (and with your experience level) are making and consider hiring a career coach to develop negotiating strategies. Then talk to your boss and make your case. If they value your contributions to the company, the raise conversation should never be off the table.
Managing your finances is a big task, but it doesn’t have to be complicated. If you’re having a hard time with financial planning in your 40s, or just need a little extra advice, the financial experts at Prometheus Private Advisory Group are always here to help. Contact us for a consultation today.