Your Thirties Are Also Good
The second in our new series here at RetireJapan. Over four weeks we'll be looking at personal finance for people in their twenties, their thirties, their forties, and their fifties.
If you're the wrong age for today's post feel free to read along anyway -you can think of what might have been or take notes for when your kids are older :)
I became interested in personal finance in my early to mid-thirties. It took me a while to really get into it, but reading books like Your Money or Your Life or The Millionaire Next Door planted the seed.
Generally speaking, people in their thirties begin settling down and worrying about the future.
They tend to have more money than people in their twenties, but more expenses too.
For a lot of people, the thirties are when they start to think seriously about their present and future financial situation.
In your thirties you still have most of your human capital (earning power) and multiple decades to reap the benefits of investing. Much of what we talked about in the twenties post applies.
Work on your career. Take a second job if it makes sense. Develop other sources of income (online content, investments, renting things out). Don't fall victim to lifestyle inflation. Keep living a simple life and save (some of) any raises instead of spending them (all).
Learn as much as you can about personal finance and investing. The Further Reading page is your friend :)
If you're going to be in Japan for the long term, pay into the pension system (it's not just a straight pension, but also includes disability benefit, etc.). Open an iDeCo account. Invest in THEO or NISA. Focus on stocks for growth, and make sure you have a diversified portfolio.
If you're not sure how long you'll be in Japan, or if you are a US citizen, consider investing through Interactive Brokers.
Figure out how insurance works here. Decide what you need and what you don't. More on this on the blog in the new year.
Think about your housing situation. Are you happy renting? Do you need to buy a new home? Can you find a good deal on a 'used' home? If you do buy, can you guarantee you'll be there for decades?
Make sure your emergency fund can cover your expenses in full if you need it to.
You still have time to make mistakes and figure things out as you go, but only if you start now. Get this right and your future self will be eternally grateful.
What do you think? Any other advice for people in their thirties?