Managing Money in Your Forties
There isn’t a time like middle age to come to terms with the fact that you need to spend and save intelligently. This is the point in time you realise that all the dreams that you had laid out for your family in your late twenties are about to come through. But at the same time, you need to be perceptive of what your own financial needs would realistically be as you head towards old age. Your actions in your forties will have very meaningful impacts on the financial flexibility you will set for your own family. Here are a few things you need to keep in mind.
Middle age should well be that time in your life where you develop an even handed understanding on what you can and cannot do with your money. New car or a new house? A PS4 for your children or piano classes? The choices that would be open to you in your forties are multiple. What you need to be aware of though, is that your expenditures have to be intelligent and pragmatic. Lot of people make the mistake of imagining financial security to be the same as financial freedom. This is just not so. Using your own money just for the sake of aping the lifestyles of your relatives and friends would only lead to negative consequences. Being very sure of what your needs really are would be a tremendous advantage for your financial scenario in your forties.
Wiping out debt
Serious considerations need to be made to pay off your debts. There is nothing more important than healthy finances when you reach your forties. This is because you would have your whole family depending on you to make their lives better. The investments and savings you have been accumulating earlier would be acting as assets that will ideally perfect your financial situation at this point in time. Armed with these and your cumulative salaries as a family, you should be perfectly placed to get rid of debt.
Saving for An Education
Your children are the promise you leave behind to this world. It is your responsibility to see that their needs, primarily, for an education are well taken care of. Plans might have been laid out back in your thirties about exactly how to go about saving for your children but the actionability of these plans will hit you in full force in your forties. Realistic plans with realistic purposes need to be followed through in this perspective. Ideally, with objective understanding on exactly what your children might want to do with their futures.
Sometimes, it will turn out that your finances aren’t where you expected them to be. It is possible to run into hard times with failed investments and by the time you get over the monetary trauma, some of the goals you might have set for yourself would be inaccessible. This is why spawning something on your own on the side might be a very good idea. The important thing is, with the added advantage of an extra income, this might also act as a chance for you to do something that you might have once been passionate about. Adapting a lifestyle with multiple streams of income is a dynamic solution to underperforming finances.
Your forties should be a time of proactivity and to an extend financial aggression. Looking forward, there should be a warranted assumption that you will be very comfortable in your old age. Intelligent decisions based on sound goals that comprise of all the steps mentioned above will go a long way in helping you manage money in your forties.