How to build wealth in your 20s, 30s, 40s and Beyond

Have you ever wondered how some people seem to have their finances all sorted? Maybe it’s after seeing a friend buy a home or talk about retiring early while you’re still sorting through rent and installments. The truth is, most people feel this way at some point - and it doesn’t mean you’ve missed the bus. Learning how to build wealth does not require you to start the earliest or be the smartest in the room. It is all about taking small, consistent steps that add up over time.

Let’s explore some strategies - decade by decade - on how to build your wealth.

Your 20s: Start Small, Start Early

Your 20s give you one powerful advantage - time. This is when compound interest becomes your best friend. Take Rohan, 25, who started investing Rs. 2,000 a month into a mutual fund. By the time he hits 50, his investment could grow to more than Rs. 38 lakhs, assuming returns at 12% p.a. Compare that to starting at 35 - you’d have to invest almost triple the amount monthly to catch up. That’s the edge of starting early.

So, how to build wealth in your 20s? Here’s how:

• Track spending and follow a 50-30-20 rule to make savings a fixed habit.
• Build an emergency fund covering at least 3–6 months of expenses.
• Begin investing, even if it’s in small amounts, through SIPs in mutual funds or index funds.
• Manage debt wisely by paying off credit cards in full each month.
• Avoid EMIs for depreciating assets, such as gadgets.

Remember, it’s not about how much you start with, but that you start at all.

Your 30s: Grow Faster, Plan Smarter

By your 30s, responsibilities usually multiply - EMIs, children, or planning to buy a property. At the same time, your income typically grows, giving you the ability to think bigger. You can:

• Set clear financial goals like home ownership, retirement, and children’s education.
• Increase retirement contributions to at least 10–15% of your salary.
• Diversify investments across equity, debt, and real estate.
• Maintain strong credit health for better loan terms.
• Purchase adequate term life insurance and health insurance to protect your family.
• Build secondary income streams through freelancing, consulting, or digital projects.

Your 40s: Protect, Optimize, and Secure

In your 40s, you’re likely in your prime earning years. This is when the focus shifts from simply growing to protecting what you’ve built.

Here’s how you can do the same:

• Increase contributions to retirement funds.
• Balance your portfolio with both growth assets, such as equities, and stable ones, like bonds.
• Save systematically for children’s higher education and other long-term commitments.
• Upgrade health insurance to cover rising medical costs and future risks.
• Continue learning new skills or exploring entrepreneurship to extend earning years.

At this stage, knowing how to build wealth is all about ensuring your money lasts as long as you need it.

Conclusion

Don’t wait for the “perfect time”. The best time to begin was yesterday. The second-best is today - take your first step in learning how to build your wealth with the Tata Moneyfy app. It helps you plan, invest, and track to make your money work quietly for you while you focus on living your 20s, 30s, or 40s to the fullest.