9 essential money milestones to reach before age 40

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There is so much that distracts us in life, but money is one area that can really hurt us down the road if we don’t pay attention to it early.

Once you hit your 40s, things should be really starting to take shape in your life: Everything from careers and money to relationships and family. And while everyone’s timeline is different, there are a few money milestones you should try to hit before or in your 40s, in order to set yourself up for long-term success.

Here are 9 essential mile markers 40-somethings should try to check off the list when it comes to money! 

1. Be in a career you enjoy.

Work is important. We spend so much of our time earning money to live, enjoy life, and save for the future.

You probably learned how to work in your late teens and early twenties, doing entry-level jobs at restaurants or retailers, or working as a baby sitter or nanny. In your mid to late twenties, after or instead of college, you probably tried out different things to see what you liked and didn’t like as much, and you honed in your skills in your thirties.

Now it’s time to put all that hard work to good use! If you’re not in a job you enjoy, it may be time to make a change. After all, you probably know what you like doing and what you don’t want to do, and life is short. Make sure you enjoy where you spend a majority of your time. 

2. Have a good sized stash in your 401(k).

In your twenties, it’s a little more forgivable to not have much of a retirement nest egg. In your thirties, not so much. Now if you’re nearing your forties, it’s really time to turn up the heat on retirement. 

If you don’t know how much you’ll need to retire, it’s probably a good idea to figure that out now. Sit down with a fee-only financial planner to come up with a solid number and a good roadmap to get there. Then, set aside a regular time to revisit your goals and see if you’re on track. Many people decide to do this around the start of the new year. 

To find out how much you’ll need in retirement, there are some online calculators that will give you a general idea of what to shoot for. But it’s best to talk to a financial advisor that can speak to your unique situation. 

The good news is, if you’re not where you want to be, you still have time to turn the ship around! 


Read more: How much money do I need to retire?

3. Have some money set aside for the kids’ college.

If you have kids, they’re more than likely elementary age now. And if you haven’t already, now’s the time to set aside some money for college! 

Clark revealed his secret tip for families with more than one child who are wondering how to plan if not all of them decide to take the college route. 

In this case, he recommended opening a 529 plan with the oldest child as the beneficiary. Then, if this child decides he or she does not want to go to college, the fund can be transferred to the next child, and so on. It might be smart to set up two college funds for three or more kids. 

Here’s how to get started if you’re wanting to save for your children’s future. 

4. Have life insurance.

Life insurance is one of those things you don’t want to have to think about. But it’s a must to be prepared in the event of the unthinkable. If you and a spouse don’t have life insurance and you have children — don’t wait another minute — buy it today!

There was a story of a young mom to-be who wasn’t ready to even consider the idea of life insurance. But her husband was very instrumental in getting life insurance early in their marriage. It’s a good thing he did, because soon after, an unfortunate situation happened. She was so grateful her husband provided a safety net that helped their family through a very difficult time.

The general rule for life insurance is ten times your income. If you need life insurance, here’s a guide that can help you get started.

Read more: How to shop for term life insurance

5. Have a will.

You might’ve heard about the heartbreaking situation regarding the musicial genius Prince not having a will. Another milemarker that can help you be financially prepared is to set up a will and make your wishes known. There are many cheap and easy ways to set up a will that can take less than an hour. Having a will avoids any confusion about your wishes and ensures your money and belongings go where you want them to in the case of an unforeseen event. 


Read more: Cheapest and easiest ways to do a will

6. Have disability insurance.

This is another one people don’t like to talk about. But the fact is, over 1 in 4 of today’s 20 year-olds will become disabled before they retire, according to the Council for Disability Awareness. And if you happen to become disabled without disability insurance, no doubt there will be a tough road ahead. 

Here’s what to know about shopping for disability insurance.

Read more: 8 things to do before buying disability insurance

7. Develop a habit of generosity, in whatever form that works for you

Sometimes in the fray of saving more money we lose sight of what’s important in life. I don’t know about you, but whenever I encounter a generous person, 99.9% of the time they’re also a happy person — and an inspiring one, too.

A few months ago, Clark’s mother passed away. Though I did not know her personally, she sounded like a lovely individual, with lots of personality. Story after story of her generosity was told during the funeral service honoring her life. She will continue to be remembered for her generosity within the community, even though she is no longer present with us on Earth.

If you haven’t developed a lifestyle of generosity when it comes to money, now may be the time to consider it. Generosity can make a positive impact not only on others, but also on your overall happiness and outlook on life.

Generosity doesn’t just mean giving money. Giving your time, your presence and your help for a cause you believe in can have just as big of an impact on the lives of others.

Read more: Study finds spending money can actually be good for you

8. Make outstanding credit card debt a thing of the past.

Clark’s biggest tip with handling credit cards is to never carry a balance, and pay them off in full each month. 


If you’re carrying credit card debt, decide to get rid of it once and for all! This can free up money you can apply to retirement, savings, the kids’ college, or trips you hope to take with friends or family. 

Here are Clark’s best tips for getting out of credit card debt quickly. 

Read more: 7 things debt-free people never do

9. Have a sizable emergency fund.

Things happen in life. Medical emergencies, job layoffs and other situations can put a significant strain on our wallet. Though a beginner emergency fund of at least $1,000 is essential for anyone, now that you’re likely deep into your career, a bigger emergency fund is probably in order. Think about how much you would need to cover your or anyone in your family’s medical bills, car repairs or other types of unexpected expenses.

Read more: Why you need emergency savings and how to start building it

If you’ve already considered all of these things and you’re under age 40, give yourself a pat on the back! If you’re not quite there yet, the good news is, you can take steps now that will take you where you want to go. You’ll be surprised how much small changes can really add up big over time. 

Big investments start with small steps

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