The expensive decade

It’s been a couple of decades since you first entered the workforce, and you’ve probably got used to managing your household’s bills. So why does it feel like the pressure just keeps building?

If you’re in your 30s and 40s and feeling like your life is financially busier than ever – even if your household might be earning more than it ever has – you’re not alone. These decades are an expensive time of life, and it can sometimes feel tricky to stay on top of commitments, much less get ahead.

Why the 30s and 40s hit differently

Our 20s are often spent focusing on goals and making sacrifices to get to them. Many people have a story or two about living on two-minute noodles in their early 20s while finishing their studies, or when they were getting started in their careers.

That’s often manageable for young people with no one relying on them. But when you’re in your 30s and 40s, you might have dependents, and many more financial obligations to think about. This is often the time of life that people are actively raising kids, with all the costs associated with that, as well as getting into the property market and thinking more seriously about saving for retirement.

The costs nobody warned you about

You might have had an idea that those “grown up” costs of managing a household and caring for kids were coming – but when they start landing in your bank account it can feel quite different to what you expected. Childcare costs add up if your kids are small, and then even when they go to school you’ll often be asked for school donations, and top-ups for school trips. Sometimes it feels like a note comes home every other week with a request for money for something.

During this time of life, you’re often not able to rely on public transport or cut down to one car so much, either. Commuting on foot can be a lot less appealing when you know you’re going to have a toddler in tow. 
None of these costs are a problem on their own, and they’re all things it’s perfectly sensible to spend money on. It’s just when everything piles up that it can start to put pressure on.

When everything lands at once

Buying a home is an important milestone but it can bring new expenses, too. Interest rates change, and you will also be managing insurance, and rates bills. Many New Zealand households have noticed council rates increasing in recent years.

You might get nicely into the groove of managing these, and then find after a few years of owning the home, you have to find money for some maintenance. Or maybe you’ve outgrown your first home and your family needs to move on to something different. These are all natural life events, but they can bring added costs.

Sometimes there’s a double-whammy for New Zealanders of this sort of age, if their parents start to need more assistance. Instead of preparing for an empty nest and a bit more disposable cash, you might be thinking about how you can renovate a room to be used by your mother or father.

Why it is not just about income

If you’re working through this stage of life, you may be earning a fairly decent income thanks to a couple of decades of work experience behind you. But financial comfort will probably require more than income. A promotion might land just as a child takes on a new, expensive hobby. You could hit an income plateau just as your household hits peak spending. Sometimes people take this time of life as an opportunity to pivot to self-employment.

Lots of people arrive at this life stage expecting they’ll be earning enough to make things feel easier. But it can often seem like all your progress is swallowed up before you really get to enjoy it. Sometimes that’s just because this is the time of your life when your responsibilities are likely to be greatest.

Getting a clearer picture

Many households, even with good dual incomes, can feel stretched when they’re managing a number of financial commitments. You’ll get through it, but often it helps to take a step back to try to take in the wider picture and consider how everything is working together. What’s working, what’s not, and where are the pressure points? Are there any things you could do to let a bit of pressure off?

If you’re in an expensive stage of life, it could be worth exploring whether your current financial setup is working as hard as it could be. If you have any questions about loans or your options to manage your borrowing, get in touch with the team at better finance™️. We are here to help. 

Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current developments or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek independent guidance.