5 tips to make saving for retirement in your 30s painless

Saving for retirement at 30 can be difficult. Use these tips to help you navigate any competing financial responsibilities life throws at you.

It's a funny quirk of life that the more money you have, the more financial obligations you have to manage. Even if your career is really starting to take off as you hit your 30s, you've also probably got new responsibilities like serious relationships, children, a new home … any of that ring a bell? 

Planning for retirement can easily slip down your priority list, but now's the time to push it back up to the top. Here are five easy tips to show you that saving for retirement at 30 or beyond is completely manageable, even if you have other financial commitments.

1. Pay yourself first

Saving for retirement at 30 can become a more formal part of your financial planning than it was when you were first out of university. Your budget probably already takes into account rent or mortgage payments, the costs associated with having children or pets, and other recurring financial responsibilities. So why not include your retirement contributions as one of your monthly expenses? That way, no matter how hectic your life gets, your retirement savings will always be quietly building in the background.

2. Stick with your long-term retirement savings goals

In your 30s, you might feel like you're finally getting the hang of adulthood. But even though you probably think about doing laundry more often than you think about eating ice cream, don't forget that you're still young in terms of your investments. With about 30 years until retirement, your investments still have the opportunity for long-term growth, so you might want to consider an aggressive approach with your investment portfolio.

When you invest over a longer period of time, you might see some market fluctuation. Don't be alarmed. Instead, remind yourself of your long-term goals and think of market dips as buying opportunities. Your regular monthly contributions are purchasing your investments "on sale" when the markets dip. This is known as "dollar-cost averaging," because it lowers the average cost of the stocks you invest in. Ultimately though, a great advisor can help guide you through the times when you should take advantage of those dips, or take a different approach.

3. Plan for retirement through career growth

Job changes can be tough on employer-based retirement plans like group registered retirement savings plans (RRSPs) and registered employee stock ownership plans (ESOPs). As you pursue new employment opportunities, consider your options for leaving employer-based plans carefully. Cashing out an RRSP can trigger an income tax bill unless you have the option to transfer your RRSP investments to a new retirement plan with a new employer or a financial institution, so make sure you have another option lined up.

If your career path means you're aiming to climb the ladder at one company, keep an eye on your company stock. After all, it is possible to have too much of a good thing. If your retirement portfolio becomes too heavily weighted in your employer's company stock, talk to your financial advisor about the best way to bring balance to your savings.

Between mortgage payments, loans, debt, and the general costs of life, saving for retirement at 30 can seem impossible. Look for ways to top up your retirement savings that work within your budget."

4. Invest your windfalls, raises, and bonuses

Becoming more established in your career can mean rising salaries and better bonuses, which is good news for your retirement plans. Instead of rushing out to make a big-ticket purchase, consider splitting your year-end bonuses or other sudden windfalls into three parts: saving, paying down debt, and spending. The same goes for any money budgeted for former expenses, like now-paid off credit cards, or money for daycare once your child has started school.

5. Balance your spending and savings

Between mortgage payments, loans, debt, and the general costs of having a family and building your life, saving for retirement at 30 can seem impossible. Look for ways to top up your retirement savings that work within your budget. For example, you can make the most of your RRSP tax refund by splitting it in two. Contribute a portion toward emergency savings, and if you have children, use the rest for their registered education savings plans (RESP), where they can earn eligible Canada Education Savings Grant money.

Above all, don't give up when things get hard. Occasionally you're going to mess up your budget or run into a surprise expense. Expect it to happen, and then happen again. You're still playing the long game when it comes to your retirement, so you can weather some bumps in the road as long as you're consistent about saving.

If you look at your budget and see that it's not feasible to increase your RRSP contributions just now, that's OK. Even small contributions made steadily can grow over time. And though it might not always feel this way, time is something you still have plenty of.


This content is for information purposes only and is not intended to provide specific financial, tax, or other advice, and should not be relied upon in that regard. Individuals should seek the advice of qualified professionals to ensure that any action taken with respect to this information is appropriate to their specific situation.