by Beth Henary Watson
For most people, your 40s, which is my own decade, are a time of great responsibility and demands. This is the time most people have kids at home or in college. Those kids may need vehicles and clothes, and you may really want to help them with their education. On top of that, as a responsible adult you’ll have life insurance and disability premiums, and probably a mortgage and some other debts too.
As hard as it may be to think ahead 20 or 25 years, though, that really isn’t all that long. In the midst of all the hustle of raising a family and continuing to build your career or business, it’s important to do your family the greatest favor, which is to make sure you are heading steadily toward financial independence. Planning to be on super-solid financial footing in your 50s, 60s, and beyond is assurance not just for you and your spouse, but for your kids as well.
Using myself as an example, I will be about 60 when my youngest child finishes the 4th year of college. I can’t wait until my kids have left the house to start making arrangements for the retirement years, because those dates come pretty close to the same time!
The biggest tradeoffs—or choices--in this decade usually revolve around paying off debt vs. saving for retirement vs. helping kids. How on earth can you do it all at the same time? Well you need to try your best, but if you’re still supporting a child or young adult, you must absolutely do a reality check on whether you yourself are on track for financial security—at least by age 65 but preferably sooner in case something happen.
In your 40s if you have not truly done a deep dive into your financial situation and hashed out a good plan to follow, it is extremely valuable to do so at this point, rather than later. In financial planning, sooner is always better than later, and later is better than never.
CERTIFIED FINANCIAL PLANNERTM Beth Henary Watson may be reached at beth@cornerpostfinancial.com.