Over the last decade I have heard this question far too many times, as people confront the reality of their personal finance. Their savings have been running on auto-pilot, with no clear strategy. Now in their 40s or 50s, they fear they are already too late to do anything about it. 

This resulting panic drives more decision paralysis. They bury their heads in the sand and avoid confronting the topic. 

Here’s the good news. 

While the best time to take charge of your personal finance plans is in your 20s, the next best time is NOW. As you get started, there is a good chance that you will find yourself in better shape than you were fearing. Taking active control of your money and future plans will create a better outcome than just worrying about it. 

The process of moving from uninformed anxiety to informed control can be a powerful catalyst for positive change. 

Try this simple 3 step process.

Step 1 – Be informed – List out your assets. What you own. Retirement accounts, brokerage value, any property. The works. This will give you an idea of where you stand. Also do a quick take of what you spend versus what you earn. To ‘fix’ your money you need to know it. If budgeting is stressing you out, a quick estimate is you likely spend a total of 3 times what you spend on housing (i.e. rent or mortgage) in the year. 

Step 2 – Waste management – identify expenses that give you pleasure and those you don’t think much about. Look to trim the latter. Take a hard look at monthly subscriptions you pay. Those twenty buck items quickly add up to big money. I found eliminating the TV plan I hadn’t watched for years, rightsizing the household’s four mobile lines, upgrading (yes UP-grading) the wifi and cutting half a dozen monthly plans knocked off several thousand a year for me. I had wasted that money for years. No longer. 

Step 3 – Invest. Money in the bank typically earns very little. Not even the same as inflation. You need to put your money to work for you. Indexed exchange traded funds are low-cost ways to diversify into stocks. Buy some bonds and gold or silver. Even custom accounts can give you 5-10x the bank account return at minimal risk. If your money doesn’t work harder, you will need to. Do that math.

With this out of the way, start to build up your knowledge. Understand and activate your money mindset. 

You are likely to live a LOT longer than even you may realise. More than a decade longer than your grandparents. Even if you are around 50 you aren’t late – you are just around the halfway mark!