7 Key financial moves to secure your future before 40

By Busola Bamidele

Hitting your 40s with a solid financial foundation isn’t just about peace of mind, it’s about setting the stage for long-term success and stability. These seven smart money moves will help you establish a secure future, ensuring flexibility and growth as life unfolds.

1. Create an Emergency Fund

Prepare for the unexpected by saving three to six months’ worth of living expenses in an accessible account. This financial buffer shields you from relying on loans or credit cards during tough times.

2. Eliminate High-Interest Debt

Tackle credit card debt and other high-interest obligations aggressively. Strategies like the avalanche or snowball method can help you become debt-free faster, freeing up resources for investments and savings.

3. Maximize Retirement Savings

Contribute consistently to retirement accounts like a 401(k) or IRA. Take advantage of employer matches and gradually increase contributions as your income grows to secure a comfortable retirement.

4. Diversify Your Investments

By 40, your portfolio should balance growth and risk. Beyond stocks and bonds, consider options like index funds, mutual funds, or even real estate to protect against market fluctuations while achieving steady returns.

5. Secure Insurance Coverage

Protect your family with adequate life and health insurance. Regularly review your policies to ensure they meet your evolving needs and provide comprehensive coverage.

6. Plan Your Estate

Establishing a will and estate plan ensures your assets are distributed according to your wishes and provides guardianship arrangements for minor children. This step minimizes legal complications and safeguards your loved ones.

7. Boost Financial Literacy

Stay informed about money matters by reading finance books, attending workshops, or following trusted resources. Knowledge is your greatest asset in making informed, confident decisions.

The Bottom Line

Taking these steps before turning 40 sets the stage for a financially stable and secure future. From building an emergency fund to mastering financial literacy, these actions equip you to navigate life’s uncertainties while achieving your goals. Start now, and your 40s will be a time of financial empowerment.