Being gainfully employed and earning income to support oneself still remains an important goal. However, mainly thanks to a combination of open parental concern and the loose attitude of grown-up children, stories of adult children living with parents are common not only in India but across the world these days. Before we get down to the social and cultural issues, let’s focus on money issues,
what are they personal Finance Marker for someone in their mid thirties? The initial years of employment are marked by the joys of freedom and income. It is quite common for young earners to face liquidity issues from time to time. The compulsion to spend, to live it like their peers, to chase some dreams for travel, clothes and comfort, and to spend for a nice house and transport is quite common with young earners .
It takes a while to see that small amounts add up. And it takes some more time to see that some of these expenses didn’t provide much in terms of satisfaction and happiness. The mid thirties is the time when this understanding develops. After earning about 10 years and Expense, the mind becomes still to keep its expenditure within its means. This is an important marker for growing in personal finance.
Many people live in denial well into their thirties and forties. They aspire to a lifestyle that does not match their income. They have secret credit card bills that pile up, and personal loans that are overdue and have lost some friends from unpaid debt. Growing up in my mid-30s is like finding one’s personal finance character—can I get real about how I deal with money? Then comes the ability to think long term.
The frontal lobe of the brain begins to develop only in late adolescence and it takes some time to acquire the emotional intelligence to defy immediate temptations. Keeping long-term goals in mind and setting aside short-term happiness to accomplish those goals calls for growing up. By the mid-thirties, one would have ideally acquired it. Is your financial life full of regrets? Did you take that exotic much-awaited vacation, regret spending more? Do you struggle to resist the temptation to replace your car, your watch, your phone, etc.? Do you mostly make hasty decisions and regret later? You’ve got something big to do. Money is a limited resource and you have to do nothing to be able to do anything else. Hopefully by your mid-thirties you’ll know this, and may put off some reckless spending decisions.
Should there be long term goals? Some argue that the best thing is to live for the present. Seeing their parents unnecessarily frugal and simple, and overly fearful of the future, today’s youth want to spend. If the savings are for a rainy day, a young man full of optimism asks what does it look like? Long-term goals don’t have to be retirement and children’s marriage. Today’s youth are surprised by these goals, perhaps it is so. Someday it will hopefully be learned that the quality of a marriage has nothing to do with the grandeur of the celebration. We fall again.
There may be worthy long-term goals that matter to someone in their mid-thirties. It might turn into an entrepreneur someday. That aspiration needs capital. It can be career changing to do something that can be extremely satisfying but not in the form of pay. This could be pursuing an education in a completely different field, requiring moving to a new country and starting all over again. or taking breaks to earn certification; Or if I so say, to raise a child; And so on. After earning about 10 years and becoming financially independent, it should be possible for one to leave the income for some other goal, think of changing track for some time or for something else. In previous generations, the goal was to find a stable job with a moderate salary and to stay with an employer. Today, the goal is to maximize earnings and ensure diversity of exposure and experience.
Achieving those dreams of achieving the ability to grow, change, try, experiment and take a hit on income is to achieve personal financial goals. By your mid-30s are you in a position to bet that you have to do something else? This is an important marker. Which brings us to the original question of property. It is not just income and potential that enables all the flexibility for today’s youth. If in their mid-thirties they have built up an asset that can be pulled on, that increases the flexibility to make the long-term choices we mentioned. I favor privileged heirs and pity those who still cannot use those assets.
Has anyone acquired the discipline of saving? Is there a surplus in the bank before the next salary arrives? Is that money being invested? Are those investment options sensible and in line with the need to build wealth? Without money power, long-term goals remain at risk. One might not write those goals in advance. But learning the art of building wealth is imperative. The mid thirties is clearly the time when the alarm should be sounded if you haven’t already started doing so. If we are not ready yet, we can pursue all the aspirations later. After stability of income, control over expenditure, ability to think long term, saving and investing to build wealth, focus on excellence. Before retirement one should be able to achieve the highest performance in their profession. It takes another 10 years of work. Get started early—still the most valuable financial advice.
(The author is chairperson of the Center for Investment Education and Learning.)