If you’ve been working for over 10years then you’re definitely in the middle of your career. You can’t be called a rookie anymore, but at the same time, you’re not near retirement. During your work life, you would have either switched jobs, roles and gotten promotions – you are officially a professional career person.
Very likely your responsibilities have also increased over the last 10 years as well. Personal circumstances may have led to you living in a bigger space due to either having a family of your own or taking care of dependents. If you have children, you are likely paying school fees and all the ancillary expenses that come with these bundles of joy. The financial strategies for this stage in your life will be a lot different from when you were just entering the career world and all you had to think about was yourself. So it makes sense to adjust your financial strategy accordingly.
What are the key things you need to look at for at this stage?
- Track your expenses closely – Your expenses have a way of rising to meet your income so don’t be fooled into thinking you don’t need to monitor what goes out just because you now have a bit more money. Especially as there are more avenues for expenditure (fees, medical bills, entertainment, larger rent, car loan/mortgage payments, etc.)
- Increase Your Savings and Emergency Fund – You’re now in what’s known as the ‘afternoon season’ of your career – income and energy levels are still high, but you also recognise that you need to start planning for when the time comes to start slowing down. Go back to the first principles of spending no more than 70% of your income. You’re earning more money and have a bit more spare cash now, so set it aside for the future – 10% in short term savings and 20% in investments.
- Speaking of Investing – Now is a good time for you to look out for investments. The key here is not to put all your money in just one area, but to have a diversified portfolio – a mix of shares, bonds, Treasury Bills, land or cryptocurrency (if you’re that adventurous) or invest in a business. There are two things to always remember with investments:
- Don’t put your money in anything you don’t understand. Otherwise, how will you know if something is going wrong and you need to pull out or change strategy?
- If it sounds too good to be true, it probably is. If there’s an investment opportunity offering you very high returns and you can’t clearly link the returns to a tangible product being produced/bought/sold, run as fast as you can!!!!
Whatever you decide to put your money in, always make sure you do your due diligence before making any investment.
- Get Insurance – You have more assets now and the cost of replacing them can be pretty high. So do yourself a favour and get insurance – for your health (remember you’re your greatest asset), home, car, etc. A lot of people don’t like getting insurance due to the premiums and while it seems like you’re throwing money away if nothing goes wrong, it can be a lifesaver if something does happen. With insurance, you won’t have to worry about whether your emergency fund is enough to fix the car, rebuild the house, or get treatment: insurance will help reduce the burden. At a minimum make sure you have health insurance, especially if you have children.
- Finetune your Side Hustle – If you plan to run your own business when you stop working for your employer, now is the best time to start putting your plans and structures in place. You have a steady income so you should set some funds aside monthly for business development. If you’ve started something already, how do you grow it so it becomes a steady source of income that you can continue to grow? Since you’re working full time how are you leveraging technology to expand your business?
- Prepare for the evening – Remember I said you’re in the afternoon season? Well, now is also the time to prepare for the evening when you want to start taking things a bit easy. Do you have a Retirement Savings Account? Do you track how much is in it and do you know the conditions for accessing the money? Do you intend to live in your own home? Do you have a mortgage or are you self-funding your project? Have you created avenues for passive income (money that comes in without you having to work for it)? Now is the time to educate yourself on these so you’re well prepared for life after paid employment.