It is generally believed that life begins at 40. Before you get to that unique age of 40, you should have achieved some financial milestones in life, in order to make your years afterwards as pleasant as possible.
I will be sharing with you some financial steps you should take and seek to achieve before the age of 40. If you have exceeded the age of 40, you can still start now to work towards these financial goals as I believe that it’s never too late to achieve anything in life, if you have the commitment and courage.
The list below are my personal recommendations. You have the choice to imbibe them or not. However, I believe that your years beyond 40 would be better if you achieve these milestones before 40.
1. Pay off your debts – Debt can be a major setback on your journey of financial security, especially debt with compounding interest. You should do everything within your power to pay off all our debt starting from those with the highest interest rate.
Your aim should be to live a debt-free life. Pay off your debts and ensure you do not get back into debt. You have more peace when you are debt- free. Business loans is an exception, however, you should explore other means of raising capital for your business before considering taking a business loan.
If you are finding it difficult to save money, see 12 tips that will help you save more money.
2. Build marketable skills – If you can do what others can not do, they would be willing to pay you for it. What skills do you have that other people would be willing to pay for? If you don’t have any skill, go and learn one today. This is very important!
Seek to learn a skill that is not common. If everyone can do it, then the value won’t be high. If you learn or develop a rare skill which you can do almost perfectly and which has a good demand, then you can’t go bankrupt as your skill will always provide you income.
Some good skills you can learn are graphic designing, desktop publishing, hair dressing, catering and decoration, tailoring, auto mechanic, generator mechanic, computer networking and repairs, computer programming, web designing, welding and fabrication, script writing, nursing, carpentry, tiling, painting, app development, installation of POP ceiling, electrician work and many others.
Most of these skills are not taught in colleges and universities, but they can feed you. Therefore, even if you are a graduate, you can learn the skills from someone who has the skill or at a skill development centre. Aim to have at least one good marketable skill before age 40.
3. Develop a quest for financial education – Information is dynamic. New information comes up everyday. What you know yesterday may become obsolete today. Therefore, you should always be on the lookout for new information. You must conciously make efforts to update your financial knowledge.
Before you reach age 40, you should develop your reading skills. Reading is one of the greatest ways of acquiring knowledge. You need to learn frequently and swiftly. Read good books and research online. You should learn how to use search engines like Google, Bing, AOL.com, Ask.com etc to get information.
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4. Get a financial mentor – You need to follow someone who has done what you want to do so as to avoid mistakes that others have made and to accelerate your financial progress.
One way of following a mentor is to read all their books or articles.
5. Have an emergency fund –
The need to always have an emergency fund can not be over emphasized. Emergency fund is money set aside in your bank account for major emergencies like job loss, illness, accident, disability etc. Experts recommend that you should have at least 6 months worth of your monthly living expenses set aside as emergency fund.
This money should have good liquidity, but it is better not kept in a savings account where you have ready access to it and because of depreciation. You can keep your emergency fund in a mutual fund account.
6. Start your own business part-time or full–time – If you don’t start a business before age 40, when will you start it? When you get old? Business is a risk and the older you get, the lower your risk appetite and propensity.
Before you get to age 40, try starting a business. You can do it part time if you are an employee. This will help you to learn, grow and gain experience from your mistakes. Business mistakes and failures are better made while you are young than at old age.
7. Get married and have all your children – You have a more balanced view to life as a married person with children. You may not agree with me, but I know this is true.
Married people hardly jump into action without giving much thought to it. As a married person you think things through and weigh things on several perspectives before making a move.
You think of the consequences of your actions as it will affect your family in one way or another. You rub minds with your spouse and make a more balanced decisions too, including business decisions because, two good heads are better than one.
Also, having your children before age 40 has several advantages as it helps you to grow with your children and it helps you to bear the financial burden of bring up your children while you are young.
8. Build a solid base of passive income streams from paper assets – Paper assets are one of the greatest ways the rich make money almost effortlessly! Warren Buffett is one of the richest men on earth because of paper asset. Imagine you have N50, 000,000 invested in mutual fund at a low annual interest rate of 10%. That means you would make about N5,000,000 annually and about N 416,666 monthly. If you keep rolling over the interest and capital, you would make even more more in subsequent years. That’s why the rich keep getting richer because they use the power of compounding to get richer using paper assets.
9. Invest in real estate – Real estate investment is one of the best investments you can ever have because, it always appreciate in value with time. Also, aside food, housing expenses in form of rent constitutes one of the highest family expenditure.
Before your get to age 40, it would be good if you have built your own house. See how you can build your own house with little income here. At worst, even if you haven’t built a house, try and buy a land before you get to 40.
10. Have your own farm – Have you considered how people would survive without farmers? You may say, ” I don’t need to be a farmer because, I can always buy the food I need” Let me ask you: What if you have the money to buy food and there is no food to buy because there are no farmers?
Even if you are not going to go into farming full time, try having a backyard garden where you plant vegetables. It will help you to appreciate the wonderful work that farmers do.
Investing in agriculture can also be a great way building wealth. There is always an available market for agricultural products. I have written several articles about agricultural businesses and how you can benefit from them.
11. Start giving out to others – You can acquire all the wealth and riches you can but, if you don’t find a way of helping others, you won’t know really fulfillment. The real measure of life is not in how much you have but how much you give.
Begin to allocate a part of your monthly income to helping other people, especially the needy , children and the elderly. You can take up the responsibility to sponsor a less privileged child through school. You can adopt a child. You can monthly meet the needs of some less privileged children and elderly people.
I can actually do without having to pass through the stress of writing articles and maintaining this blog since I actually don’t gain reasonable financial benefit from it. However, my joy is that this blog is helping thousands of persons to overcome poverty and become financially stable.
Start now to give out to people. You don’t have to be very wealthy to help others. Give the little you have as it opens more doors of resources to you. There are many people around you that need your little assistance and help. You can give to the needy, disabled and motherless babies home in kind or in cash. You can sponsor a poor child through school. There are inexhaustible avenues you can give to others.
Bonus Tips :
1. Write a will – Many financial experts recommend that you get a lawyer to help you write your will which legally confers the ownership of your properties to whoever you wish when you pass on. This is important especially in conflict prone families.
2. Buy an insurance policy – Several financially experts also advise that you buy a life insurance. The purpose is to provide financial benefit to your loved ones when you pass on.
There you have it. Getting information does no one any good unless it is utilised. The choice is yours.
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