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In Your 30s? Here’s Your Checklist

As your earning power increases, your 30s are a great time to further build your retirement savings foundation. Here are some tips to consider.

1. Continue (or start) saving

  • Maximize tax advantaged retirement accounts like your workplace retirement plan and let time work for you through the power of compounding.
    • Enroll in your workplace retirement plan today.
    • If you’re already participating in your company’s retirement plan, make sure you’re contributing as much as you can afford. If your company matches your contribution, take full advantage of this great benefit by contributing at least as much as the match amount — otherwise you are losing out on “free money.”
  • Target to save at least 10% of your income
    • As a general guideline, consider contributing at least 10% of your income to your retirement plan in order to have enough income during retirement. If you cannot save 10%, save as much as you can afford and gradually increase your contribution each year.
  • Consider adding bonuses, tax refunds, or other lump-sum payments to your retirement savings
    • Setting aside financial windfalls can help accelerate your retirement savings. Consider saving outside your retirement plan and opening an IRA. You’ll thank yourself later.
  • Continue (or start) building an emergency fund
    • Most experts agree that you should keep between three and six months worth of your living expenses set aside in an easy-to-access “liquid” account, which includes a checking or savings account. The reason you want to have three to six months of expenses saved up is that the most common reason for the need of an emergency fund is due to a sudden loss of income. If you or your spouse loses a job you still have bills to pay and it may take a few months to find suitable new employment. This cushion will help you weather an emergency without dipping into your retirement savings.

2. Watch your spending

  • Keep debt down
    • Minimizing debt typically improves your overall financial health. Find the lowest interest rate available and consolidate your debt. Then pay off as much as you can each month.
    • As you reduce your debt, consider putting the available money toward retirement and other savings goals.

3. Refine your plan

  • Write down your retirement goals and outline a plan.
  • Check your asset allocation periodically — are you on target?
Recordkeeping, trustee and/or custody services are provided by Wells Fargo Institutional Retirement and Trust, a business unit of Wells Fargo Bank, N.A. This information is for educational purposes only and does not constitute investment, financial, tax or legal advice. Please contact your investment, financial, tax or legal advisor regarding your specific needs and situation.