9 Financial Goals You Should Achieve Before 40
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Turning 40 is a big milestone. A lot of people don't know, but 40 is 40% of the way to being 100 years old. You just blew my mind. And this is a good point to stop and assess where you are with your money and where you want to go. Why 40? Well, at that point, you've had enough time to make some financial progress, and you likely still have time to make a big impact on the future ahead. So whether you're already over the hill and you know what it's like to injure your back while sleeping, or you're in your 20s and 30s and you still have a limber lumbar region, keep watching.

Because in today's video, we're going to talk about nine financial goals to achieve before you turn 40 to make sure you and your family are on the right path to building wealth. But first, click those like and subscribe buttons and share this with your friends who are on the verge of a midlife crisis. And do it before they buy a Miata and start wearing those weird little bead bracelets. What's going on there?

Why? Why? Okay, the first goal to achieve before 40 is debt freedom. If you're approaching 40 and you still have consumer debt, AKA any debt that's not a mortgage, that's a big problem, red flag. Because when you have to send chunks of your income out the door every month to make those debt payments, it's gonna be pretty hard to make progress with your money. For example, let's say you've spent 500 bucks a month on a car payment for the last 15 years.

If you would have invested that money instead, you'd have over $200,000 by now. But instead, you have a car that's still not really yours. And sadly, payments are the norm in America. 34% of Americans say they have more than 10 grand in consumer debt. So if that's you and you have a car payment, credit card debt, student loans, or any other kind of debt besides a mortgage, get rid of it ASAP so you can stop paying for the past and start funding your future. Okay, second financial goal to achieve before 40 is having a full emergency fund.

Honestly, you should reach this goal way earlier. But the reality is, a lot of people don't. In fact, only half of Americans said they have $1,000 in savings. That's a problem. Because life is full of surprises. And no surprise, some of those surprises cost a lot of money. Like when your AC goes out. Or when you start to get some leakage from the soft top on your midlife crisis Miata. Or when you take your Frenchie to the vet and they take approximately 23 x-rays, only to find out that your dog is not injured, it's just obese.

True story. Just me. Cool. You're on a diet because you're a little chubby. Okay. Those kinds of things can derail your financial progress if you're not prepared. So I recommend having three to six months worth of expenses tucked away somewhere in a high yield savings account where it's accessible and you can earn some decent interest. And I'll

And I'll tell you about a great one in just a bit. But that emergency fund will be a solid safety net between you and whatever costly catastrophe life throws your way. Here's the importance of this. When you have a financial emergency, you're not going to need to use debt to pay for it, making it less of an emergency and more of an inconvenience. Okay, goal number three before 40, home ownership.

Now before you @ me in the comments like "George, not everyone has to own a home. I'm a renter by choice. It gives me flexibility. You don't know where I live." Calm down, tenant. What did you just call me? I know this is not going to be a goal for everyone and that's okay. I'm not mad at you. But in my opinion, it's a good goal to have. Especially for those of us who like to pick out our own paint colors. Like,

Cinnamon Slate by Benjamin Moore, which if you're curious, is a velvety plum color with rich brown undertones, and it's the perfect choice for creating a sophisticated yet welcoming atmosphere in the butler's pantry.

Butler's Pantry. Gosh, if you even have a Butler's Pantry, you're not watching my channel. You're watching Grant Cardone. Who's got your cookies? Now, my wife and I bought a home several years ago, and we have zero regrets. It's appreciated in value, and that's added to our net worth. But don't feel bad if you're 40 and still renting. That might make sense if you're in an ultra high cost of living area like San Francisco or New York City.

And the right time to buy a house has nothing to do with your age. It has everything to do with how financially ready you are. Once you're debt-free with an emergency fund, here's the recommendation. You want to have a down payment of at least 5% to 10% if you're a first-time homeowner. And I recommend buying a house with a payment that's no more than 25% of your monthly take-home pay on a 15-year fixed-rate conventional loan. When you can do that, you're financially ready to own a home, regardless of your age. Now, is that extremely difficult with the current housing market?

Yes, but if you jump the gun and you end up with a mortgage where you're throwing 40, 50, 60% of your take-home pay towards living expenses, you're going to be broke and life will be hard. So even if you're 40 or over, hold off on buying a house until you're financially ready. Otherwise, your dream home could become a financial nightmare. The fourth goal to achieve before 40? Investing for retirement.

I recommend investing 15% of your income in tax-advantaged retirement accounts like your company 401k or a Roth IRA, but only after you're debt-free and you have that fully funded emergency fund, aka goals number one and two on this list. Hopefully by the age of 40, you'll have those two boxes checked as well as enough financial margin to consistently be investing 15%.

Because compound growth takes time. And if you start early enough and invest consistently, you can retire a multimillionaire. Now, if you're 40 and you're just getting started, don't freak out. You still have at least 20 years until you reach retirement. And these next few decades will likely be when your income is the highest, which means more money you can shovel away in that nest egg. Look at it this way. The median salary for Americans in their 40s is around sixty nine thousand dollars.

If you started investing 15% of that salary starting at age 40 and did that every single year until you retired, you could still retire with a million dollar net worth. And remember, once you hit 50 years old, you can take advantage of catch-up contributions to make up for lost time. I know everyone's situation is different, so punch in your unique numbers using our investment calculator to see for yourself what will be and what could be.

I'll drop a link in the description below if you want to check that out. Okay, goal number five before you hit 40, investing for your children's college. If you have kids, this is a great goal to have. I recommend doing this with a 529 plan or an education savings account or ESA for short. These accounts act sort of like a Roth IRA, but for your kids' education expenses.

And let me tell you, opening a 529 plan was one of the first things I did when my daughter was born. Probably could have waited until after the umbilical cord was cut, but I was just so excited I couldn't help myself. And just like retirement investing, the sooner you start contributing to this education fund, the more time you'll have for compound growth to work its magic on your money.

Get this, if you contribute just $150 a month from age zero to age 18, you'll have potentially six figures of tax-free money to use for college or trade school or Derek Zoolander Center for Kids who can't read good and want to learn to do other stuff good too. A lot of options out there. How can we be expected to teach children to learn how to read?

if they can't even fit inside the building. And here's a fun way to help save for your kid's college. Bring the family into it. Ask your family to contribute to an education fund as a birthday gift or Christmas gift. Maybe Aunt Gertie chips in some college money to go along with the SpongeBob Crocs gibbets that she bought on Etsy from someone with a 3D printer and a blatant disregard for intellectual property rights. No judgment, but stay safe, Aunt Gertie. They're coming for you. You'll never catch me alive!

All right, moving on. Goal number six before you hit 40, growing in your career. By the time you're 40, you're probably more than 15 years into your career. So you should not be where you were in your mid-20s. You're hopefully making more money as you've grown professionally. Put it this way. If you work at Cracker Barrel, you should have at least four stars on your apron by 40. Minimum. Now, ideally, you'll be earning enough to accomplish the goals we've already mentioned on this list and still have some leftover for things like saving, investing, and of course, Spongebob gibbets.

If not, you might want to consider some serious changes. If you're close to 40 and you're stuck in a dead-end job with low pay, no room for advancement, and no way to earn more money, it's time to start looking for a new job, maybe even a new career field altogether. Like I said earlier, the average salary for Americans in their 40s is around $69,000.

So if you're making a whole lot less than that, or if you're not making enough to live the kind of life you want, it's time to make some career moves. And speaking of making moves, if you've got a lot of money sitting in a regular old savings account earning dismal interest, it's time to look into a high yield savings account like the one offered by Laurel Road, one of the sponsors of today's video.

With Laurel Road, your account balance earns top-tier APY. So if you're saving up for a new car or stashing away a hefty sum for a down payment on a house, all of that money could be making you more money. Plus, with Laurel Road, there's no minimum balance required to open an account, your deposits are FDIC-insured, and there's no hidden fees. Learn more by going to laurelroad.com slash george or click the link in the description below. And can I give you a bonus tip before you hit 40?

Don't overpay for your phone plan. You're too old. You're too smart to fall for this crap. All right. Instead, switch to Tello, where you get the same great coverage as the big guys at a fraction of the cost. You see, Tello piggybacks off of T-Mobile's towers, so you get the reliability without the price tag. And Tello's plans start as low as $5 or up to $25 a month for unlimited everything.

Plus, you can adjust your plan as needed and get started in minutes from the comfort of your couch. That's what I did. And right now, you can get an extra five bucks off your first month of the Unlimited Everything plan by going to tello.com slash george or click the link in the description below.

All right, back to non-bonus goals. Goal number seven before you hit 40, making extra mortgage payments. There are people who will tell you not to worry about paying off your mortgage early because it's, quote, cheap debt, a.k.a. money borrowed at a low interest rate. But the way I see it, a mortgage is like diarrhea. As soon as you get it, hopefully you want it gone ASAP. If you don't, I have questions. You should have picked a different analogy. And here's why. If you pay off your mortgage early, you can save tens of thousands of dollars in interest payments, maybe even hundreds of thousands of dollars.

Plus, when you get rid of that mortgage payment, you can use that extra money for things like investing, giving, saving up for vacations, or buying a movie-quality Captain Hook costume for your monthly pirate cosplay meetup. Do what you do, whatever swabs your poop deck, man. Who am I to judge? I'm judging. Secretly. I don't know if it was clear. I was judging.

I don't remember asking you for your input. When you have a paid-for home, you don't have the golden handcuffs of a good interest rate. You know what the best interest rate is? Zero. No interest rate. And you might be in a position to purchase your next house in cash since you have 100% equity to roll into the next one. On top of all that, no debt means less risk. And for me, less risk equals more peace. My wife and I got a 15-year fixed-rate mortgage and paid it off

ASAP and it saved us so much money in interest. If we would have gone with a 30-year loan and we took 30 years to pay it off, we would have paid over six figures in interest. And let me tell you, our house has gone up in value more than any of our investments so far. So if you own a home, a good goal to achieve by the age of 40 is to be making those extra mortgage payments or at least have a plan to pay it off in the next five to 10 years. Next up, goal number eight before you

I know, this one might be a shock to you. But look, just because you're 40 doesn't mean you have to be a boring grown-up. Enjoy life, take trips, join a pirate cosplay group, that's what you're into. Make time for fun and things that you care about. Don't become a shell of who you once were. You don't have to wait until you're over the hill to start doing this, but when you're 40, you'll likely be making more money than you ever have.

So you should have some more margin to spend on your hobbies and passions, no matter how weird they may be. You should also have some more margin for goal number nine on our list, and that is giving generously. I always tell people it's important to be generous. Give a little until you can give a lot. A good baseline is give 10% of your income, no matter where you are on your financial journey, even when you have debt. And before you call me crazy,

Hear me out. Yes, you should be giving with pure motives, not expecting anything in return. But there are a ton of benefits that go along with being generous. A study from Stony Brook found that when you're generous, your brain releases happiness chemicals like dopamine and oxytocin. We could all use some of that. And a study from Carnegie Mellon found that people who volunteer around four hours per week are 40% less likely to develop high blood pressure than those who don't volunteer.

So this doesn't just have to be your money. This can be your time. And generous people are open-handed with all of that. Their money, their time, their talents, their words. We want to be around those people. They're attractive. And by the time you're 40, you should have even more margin to bless others. So make it a priority. Make it a habit. And again, you don't have to wait until you're 40 to start doing this. In fact, if you want to be a generous person, there's no better time than the present to get started. If you say, well, when I have this much, then I'll be more generous. The truth is, you won't.

Why? Because you haven't built the habit. And let's be real, giving is the most fun you'll ever have with money. So make it a habit now, set aside the money, create the line item in your budget and make it happen. So if you're still in your 20s or 30s, now's the time to take action and make sure that you're on track to hit these nine goals before the age of 40. Even if you've still got plenty of time, it's still gonna take a lot of intentionality to get there. And if you're over 40 and you haven't met these goals yet,

Don't panic. You're not a failure. Yes, you're older than you've ever been, but also think about it this way. You'll never be this young ever again. I think that was encouraging. Not sure in hindsight. Everyone's financial journey is different and there are still things you can do to build wealth for retirement and get your net worth up. And by the way, if you want to know what your net worth should be by the age of 40, keep watching this next video or click the link in the description below. Thanks for watching. See you next time.