Recently the Wall Street Journal published an article called “The Biggest Money Mistakes We Make–Decade by Decade .” Here are some of the most interesting excerpts with comments.

In your 20’s

The first full decade of adult life should be about investing heavily, experts say….

Her team sampled a group of roughly 100 millennials and found that they tended to favor retirement accounts with little stock and more guaranteed income—choices that would bring skimpy returns over time. When asked why they chose such a conservative portfolio, participants said things such as, “I honestly know nothing about money right now.”

We agree that the sooner you start saving and investing for your future, the better. While many millennials do not know a lot about finances or investing, there are many resources available to educate yourself and any millennials you know! We have some resources listed elsewhere on our blog, and taking even a little time to talk to the HR department at your job or reading a little bit about saving and investing can make a huge difference over the long term.

The article warns about “playing it too safe,” and we agree that while you should be concerned about extremely risky and illiquid investments, your 20’s are a great time to throw money in the stock market and let it ride. The value may go up and down a lot in the short term, but over decades returns look much smoother.

It is also difficult to think about saving for retirement when you expect to keep working for 40-50 more years, but thinking about your future self is crucially important.

In your 30’s

More so than in previous generations, the third decade of life is when many people start making huge adult commitments such as getting married or having children.

Many people in this phase of life want the same standard of living they remember their parents enjoying when they left home.

When you are in your 30’s you should be trying to save where you can and not inflate your lifestyle, which become difficult while raising kids. Trying to have too much too soon can cause you problems down the line when you need your retirement funds to support you.

In your 40’s

By our 40s, we tend to be about halfway through our working lives—just as bigger expenses enter the picture. Many financial advisers point to two in particular that can be rife with error: the house and the children.

The article recommends working to pay down your mortgage so you won’t have that expense in retirement. While that is a good approach for some people, we often recommend to our clients that they keep the mortgage or refinance at current low rates of interest and continue to save and invest. If you are thinking about paying extra on your mortgage, consider putting that money in the market instead, where it will likely appreciate more than enough to cover paying mortgage payments in retirement.

Even before [college expense] considerations come into play, expenses such as sports or extracurricular activities can get out of hand. Jennifer Lane, a financial planner at Compass Planning Associates in Boston, Mass., recommends that, in general, parents pay no more than 10% of income on expenses for children. She has also found that allowances help keep costs down. “They’ll choose not to spend when it’s their money versus your money,” she says.

In your 50’s

One nightmare scenario for many in their 50s is the realization that they may not have enough money stashed away for retirement. Adults now live much longer lives than they used to, and financial experts say retirement funds now need to last up to 40 years and beyond. Lots of temptations encourage people to withdraw from retirement accounts early, and sometimes unemployment or other squeezes make it difficult to contribute.

The difficulties can be compounded by lifestyle creep.

This is often when the thought of retirement become more real to people, especially as their children grow up. We call the 50’s “the last chance to save for retirement” because with reduced childcare expenses, people often have increased income at their disposal. If you are behind, this is a great time to save and invest aggressively, while the window of opportunity is still open.

While your mid-life savings will not have as long an opportunity to grow, you do still have some time.

In your 60’s and beyond

As we get older, our personal balance sheets grow more complicated. But numerous recent studies on aging reveal an unpleasant truth: Our analytical abilities can’t keep up with the complexity. And since we’re living longer, that makes it even more likely that we’ll have to deal with cognitive impairment.

Aging is painful in many ways, and no one wants to contemplate impairment, but we find it is better to put a plan in place while the needs are still hypothetical. If you talk candidly with your family about what you want and how they can help while you are still healthy, it will not be as painful as trying to navigate this once the need is apparent. If you make a business-like arrangement, that may help to allay some of the relational discomfort involved in end-of-life discussions.

You should make sure your estate plan is in order, and have a plan for what to do if you require more help. Having a plan will put less of a burden on a family that will be distressed when the time comes to put it into place.

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