investing in your 30s

How to Save for Retirement at 30 and Become a Millionaire

“You only have to do a very few things right in your life so long as you don’t do too many things wrong.” ~Warren Buffett (source;

Best Investment Strategies for 30 Year Olds

Get the specific, actionable steps to become a millionaire if you are in your 30s. Use this financial advice for 30 somethings as a step-by-step guide for wealth building. Investing at 30 might seem a bit early to some, but by starting when you’re young, you’ll need less money to reach a million dollars at retirement, than if you start later.

Don’t stress if you haven’t started to invest at 30 for your future. Now is the time to start understanding and implementing how to plan for retirement at 30.

How to Become a Millionaire - 5 Investment tips for millennials in their 30s

Investment Strategies for 30 year olds – Backstory

My husband and I started out with financial challenges. In our first year of marriage, I quit my job to get a graduate degree. Despite living on one income, we managed to save. The next year, I went to work and my husband began his 4-year graduate studies at a private university with sky-high tuition costs. Fortunately, before going back to school we built up our savings accounts.

When we had our daughter, I quit work to become a full-time Mom. In fact, we lived on one income for much of the time that our daughter was growing up. Throughout our daughter’s formative years, despite living on one income for much of the time, we aggressively saved and invested. Many decades later, we’ve surpassed our retirement goals.

Here are the best investment planning strategies that worked for us.

Read on for tips to become a millionaire for 30-year-olds – that work.

1. Max out your 401(k) to Become a Millionaire in Your 50’s

When seeking the best investments for a 30 year old or even if you’re saving for retirement at 35, your workplace retirement account – 401(k) or 403(b) – is the best place to start. If you’ve put off signing up, do it now!

In 2023, the maximum allowable contribution amount into your 401(k) is $22,500, with an additional $7,500 allowed for those over age 50. This doesn’t include the employer match for your 401(k). This is a lot of money, yet, if you’re in the 24% Federal tax bracket, it’s as if you’re only contributing $17,100, a savings of $5,400.

Behavioral finance shows that if you have this money automatically withdrawn from your paycheck, after a short while, you won’t miss it. You learn to adjust your spending to your available income.  

Here’s how it works:

Thirty-two-year-old Dylan earns $85,000 and contributes $22,500, into his 401(k) account. The first benefit is that instead of paying tax on $85,000, he pays tax on $62,500 ($85,000 – $22,500). Since he’s in the 24% marginal tax bracket, this saves him 24% of $22,500 or $5,400 immediately.

Assume that Dylan contributes $22,500 annually into his 401(k) and they grow at a conservative 7% annually.

In 23 years, at age 55, Dylan’s retirement account is worth approximately $1,393,000.

If you’re worried about “How much to save for retirement in your 30’s?” and can’t handle the $22,500 per year, then look at this example.

Now, let’s switch up the assumptions. If $19,000 per year is too much to invest monthly, reduce the investment amount to $12,000 per year, which is equivalent a reduction of $9,120 after-taxes. With the $12,000 per year 401(k) contribution, Dylan becomes a millionaire in 30 years or at age 62.

And this analysis doesn’t even take into account an employer contribution.

If you’re a two income family and both parties contribute to their retirement account, the results will increase proportionately.

If your employer kicks in a 5% match, your money will grow more quickly and you’ll reach the one million dollar mark much younger. 

2. What are the Best Investments for 30 Year Olds?

Choosing the best investments for 30 year olds isn’t rocket science. Either stick with a target date fund, geared for your projected retirement year or pick several stock and bond index funds.

When investing in your 401(k), they’ll offer a choice, but don’t get overwhelmed.

Most retirement accounts offer target date mutual funds, which are a one-stop-shop for investors. Within one fund you get a diversified pool of investments including stocks and bonds. The proportion allocated to stocks is greater when you’re younger and lessens as you get closer to retirement.

In your later years, you’ll own a larger proportion of bond type investments and less of riskier stocks.

You can also set up a lazy portfolio on your own and select several index funds on your own. Read on to find out more about the best investments for a 30 year old. 

3. Best Investment Strategy for 30-Year-Olds is to Slash Fees

One reason that low fee index fund investing is so popular is that more of your money is working for you instead of going into the mutual fund manager’s pockets. Whenever you make a financial investment, whether in your 401(k), IRA, Roth IRA or investment account, look at the fees.

Vanguard shows how fees eat up your investment returns. Assume you have a $10,000 investment that earns an average 6% per year. Here’s how various fee amounts will impact your account value 25 years later:

Value of $10,000, Invested at 6.00% Annually After 25 Years

Initial Investment Value

Average Annual Management Fee

Value of $10,000 after 25 years

Amount Paid in Fees













Source; Vanguard

Be assertive and ask your financial advisor the fees charged for your mutual or exchange traded funds. If you’re investing on your own, look at the fund information sheet and check out the average fees.

To sum up, when considering, “How to invest for retirement in your 30s?“, check investment fees. Make it a priority to choose low-fee index funds for your investment portfolio!


4. Maximize Returns by Investing in Low Fee Index Funds

Index funds are baskets of stocks or bonds that match a pre-determined index of securities. Some total market indexes mirror the entire U.S. stock market. Others focus on the S&P 500 or small capitalization stocks. There are scores of index funds from which to choose.

Yet, you don’t need to get too fancy when choosing a couple of index funds. To make your choice easy, check out “What Are Index Funds and Asset Classes Investing?” for a handy list of low fee funds.

There are scores of low fee index funds available with Schwab, Vanguard, iShares and many other fund families. For example, Vanguard and Schwab offer two index mutual funds that span the total U.S. stock market.

  • The Vanguard Total Stock Market ETF (VTI) charges a 0.03% fund expense ratio.
  • The Schwab U.S. Broad Market ETF (SCHB) also charges an 0.03% expense ratio.

Before choosing investments in your brokerage or 401(k) account, be sure to look at the fees.

Bonus; My Best Lazy Portfolio

5. Automate Your Investing in Your 30’s

To ensure that you’re making the best investments in your 30’s – automate. That means, in addition to setting up a direct deposit from your paycheck into your retirement account, and do the same for other investment and savings accounts.

Go to the human resources department at your company or create an automatic transfer from your checking account into a savings account and a Roth IRA and an investment account. Even a small amount each month will build up over the long term.

You’ll be surprised that once the money is out of your hands and into the savings and investing accounts, you’ll learn to live on less.

6. Become a Millionaire With Smart Money Habits and Behavioral Finance

Just like losing weight, or learning a new skill, saving for retirement at 30 begins with your behavior today. Don’t let your friends, the media, new gadgets or exotic vacations derail you. If this financial path is important to you, here is another step in a wealth-building plan that works.

Think of it this way, you can live like you’re rich today or you can become rich tomorrow. It’s your choice.

If you overspend on the largest expenses – housing, transportation and food – it’s difficult to succeed financially. Fortunately, there are many ways to live well and economically, but you need to train yourself to change!

Thaler and Sustein discuss ways to structure your life and guide you to make the best life choices in their book, Nudge. For example, if you’re watching your weight and you don’t keep treat foods in your house, then it’s easier to resist that bowl of ice cream or chips. The same strategies work in personal finance. Behavioral finance helps you set up successful money strategies like automating  your investing and saving.

Saving for retirement at 35 means more than transferring money into an account and investing that money. Here are a few smart money habits to make it easier to invest in your 30s.

Choose to become a millionaire and then set the path, without veering off into extravagances.

Read: Why is Asset Allocation is Important? The Most Crucial Investment Concept

Investing in Your 30’s Lifestyle Tips

First, decide to live with less. Then choose from these lifestyle tips to slash expenses:

  • Build an emergency fund. Make sure you have 3-6 months of your income saved in a savings account. That way, when your car breaks down or you have a big expense, you won’t be forced to sell your investments. Choose a high yield savings account or money market account, to get the greatest return on your savings.
  • Choose to live in a lower cost of living area. We chose to raise our child in the Midwest versus in California to slash our living expenses.
  • Live in a smaller home or apartment. My grandmother, grandfather and mom lived in a two-bedroom apartment. In fact, homes used to be much smaller than they are today.
  • Drive an economical car and keep it for a decade or more.
  • Say no to your kids. They can live well without baskets of toys and excess clothing and electronics.
  • Plan your meals to include affordable choices and batch cook at home.

By making these fundamental choices on the big expenses, it’s likely that you’ll live within your means and meet your financial goals. For more wealth building and investing tips check out my book, Invest and Beat the Pros.

7. Slash Debt in Your 30’s to Become a Millionaire

In the same way that saving and investing positively compounds your money, debt works the opposite way. If you’re paying 18% interest on the unpaid balance of your credit card debt and earning a 7% return on your investing, then you’re losing 11% by not paying off the debt.

When you finance an expense, not only are you paying the initial cost, but hundreds or thousands more dollars in interest payments. Dedicate yourself to finding ways to eliminate your debt as quickly as possible. Whether you consolidate student loans or cut up your credit cards and go to an all cash system, getting rid of debt will immediately increase your chances of becoming a millionaire.  No matter how much you earn, save and invest, if you’re carrying debt (except your mortgage debt), you’re sabotaging your chance to maximize your financial future.


How to Save for Retirement at 30 – Wrap Up

If you’re asking this question now, then you’re very smart.

To sum up, start saving for retirement as soon as you get a job. Create a mindset of minimizing your needs and maximizing your savings and investing.

That means, invest in stock funds for more aggressive growth when you’re younger, because, although they’re volatile, you’ll have time to recoup any losses, as long as you stay investing.

Don’t limit your investing to your workplace 401(k), but open a Roth IRA and an investment account too. If you want to turn over your investing to the pros, for a low-fee, consider investing with a fee only financial advisor or a robo-advisor like Wealthfront.

Live consciously by spending within your budget and prioritizing saving and investing. By researching the best investments for 30 somethings and getting started today, you’ll likely reach a million dollars when retirement rolls around.


Featured image credit; Photo by Austin Distel on Unsplash

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