Everything You Need to Know About Investing in Your 30s

If you want to know more about investing during the other decades of your life, don’t miss our other posts in this series about investing in your 20s, 40s, 50s, and 60s.

Good news! In your 30s, you can withstand taking on some risk in exchange for building wealth through equity and reinvesting. When you wisely choose securities that have the capacity for market growth and reinvestment, it takes less new money for the value of those positions to increase in value.

You don’t just need to go after the latest stock picks either. Many mutual bonds pay monthly or quarterly dividends and you won’t feel the need to watch them daily. Even stock analysts research trends over quarterly and yearly periods. Periods shorter than that usually won’t teach you much about traditional investments. Surely, when you’re investing in your 30s, you can think of many other activities to enjoy other than watching stock market dials. Discover some practical ways to understand the risk levels you are taking on when you invest. This way, you can put a diversified portfolio together in your 30s that won’t stress you day to day.

Already experienced a career change?

If you are in your 30s, you probably experienced the Great Recession first-hand. It was a scary time for any working-aged person whether they were in their 20s or their 50s. Unfortunately, thousands of people lost a large sum of their retirement savings as a result of an event that most could never have anticipated. Banks merged and many companies had to reduce staff and salaries. Some companies couldn’t recover from the losses and had to close their doors permanently. The market decline meant that college graduates and those early in their careers had to learn a new skill set or start a new career.

Starting over doesn’t mean you have to continue looking back. Investing in your 30s means you can establish your pathway to a successful retirement from where you are. With careful planning, you can still make strategic investment decisions that enable you to forget about the uncertain times. It’s more common than you might think that people in their 30s are in the early stages of retirement savings.

Investing beyond a retirement account

It’s always okay to start small. If you’re afraid of picking the strong stocks and losing out, then try trading fractional shares, which many brokerages specialize in. It’s a fun way to get familiar with brokerage accounts and buying and selling stock shares. The Balance recommends seven different online fractional share brokerages. Venture out on your own and focus on a specific market sector and begin to research companies within that industry. No one can be great at everything, so here’s a chance to become a single market guru. 

How to factor in student loan debt

Student loan debt is the elephant in the room for hundreds of thousands of former college students. Your teachers told you to get good grades and scholarships for college and you did. What college admissions counselors didn’t tell you is that, even as an undergraduate, students still often need to take on debt. Post-graduate studies are intensive, and many are forced to fund it entirely through debt if they want to focus solely on their studies and achieve strong grades. Most Americans don’t have college savings accounts.

No doubt, the money you put towards those student loan balances each month does redirect money away from investing in your 30s. However, there may still be hope. Check on your repayment options. Sometimes loan servicers offer reduced rates for automated payments. Some programs also exist to decrease the burden on industry-specific professionals such as teachers, military members, and nurses. Ten years of government services can, in some cases, eliminate your student debt load entirely. Privately financed student loans may qualify for lower rates with good payment history. Low-rate extended repayment schedules aren’t bad when you have an opportunity to increase your earnings through investments in stocks and other funds over the years ahead. Think of it as opportunity cost.

Thinking about starting a family?

Family planning takes financial planning. If you want to have children someday, now is the time to begin preparing for that outcome. You need a separate account and, ultimately, a plan for it to fund tax-protected investments. A few accounts here to consider:

• Healthcare Savings Accounts (HSASs). They are never taxable or penalized when used properly.
• College Savings Accounts, including Coverdell Education Savings Accounts (ESAs) or 529 Savings Plans
• Whole life insurance for yourself and, once your child is born, half your policy value is customary.
• Household Emergency Account

Life can be uncertain. Bringing new members into your household means that surprises have a larger impact on your wallet. A wealth manager can help you to make some key decisions for the well being of your family.

Managing your investments in your 30s

Investing in your 30s doesn’t need to be a mystery. With the right guidance, you can be well on your way to a diversified investment portfolio, a healthy retirement account, and continued learning about trading in the stock markets. Good investment advisors can play an important role in helping you to make decisions that can shape your life long-term.

If you’re hitting your career stride in your 30s and are ready to make a financial plan for your future, consider talking with an experienced wealth advisor. SD Mayer advisors have decades of experience helping individuals invest in every decade of life, whether it’s your 20s, 30s, 40s, 50s, or 60s. To learn more or to set up an initial consultation, contact us. 

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