Some things in life are so difficult to decipher, that it usually takes an entire lifetime to get a good understanding of the matter. But that’s the beauty, right?

You try, you fail, you learn from your mistakes, and then repeat it all over again.

Wouldn’t it be nice if someone would just come and explain all the secrets we haven’t found yet, or all the tricks we simply can’t see? When it comes to money and retirement, things get even worse, because there’s a limited amount of time for mistakes here.

You can’t wake up one day and simply expect to be wealthy. You build it from the ground, you follow a set of rules. Which rules? I tell you which rules because here are the most crucial things you have to know before turning 60 (if you want to live a happy and worry-free retirement):

Pay off your credit cards every month

The average American has $7,000 worth of debt, accumulating fines on their credit cards, and this is probably the number one mistake everyone makes in their 20s and 30s, according to Carla Dearing, a certified financial planner and CEO of SUM180, a famous digital financial planning service.

As Carla explains, “there are too many people who think that a credit card debt doesn’t mean that much, but do you have any idea what’s the acceptable amount that you can carry over? Zero.” Due to high-interest rates, paying off your credit cards month after month should definitely be your number one priority.

Save six months’ worth of expenses

Half of the adults didn’t manage to save not even $400 in case of any kind of emergency, not to mention the money that would be needed for a much broader event, such as losing your job.

While everyone knows they should try and save more, that’s usually when you get stuck. The trick is to know your ‘number'”. And by that, we’re talking about the amount of money it would require to cover six months of the basic expenses.

Do a 30-day money ‘fast’

While juice and water fasts have become very popular among health topics, it turns out that one of the healthiest fasts you could ever do is a “money fast”.

And by that, I mean setting yourself reachable goals, such as going for a full month without spending money on anything, rather than your basic bills and keeping that money for something bigger. By doing this, not only you will start feeling a good boost, but once you realize how much you’re spending on regular things, it will be much easier for you to save up.

Solve out your 401k

Have you figured out everything about your 401(k)? Where is it? How much have you got so far? While it’s understandable that it can be a scary topic, many people ignore it until the very last minute, which is oftentimes too late.

And when it comes to 401(k), trust me, ignorance isn’t bliss, especially when it’s capable of damaging your retirement years. If you think about it, 42% of adults in the United States don’t have any kind of plan for their retirement, according to a survey conducted by the Motley Fool.

As no one expects you to be some kind of retirement expert, there are always people around you that could help you out. For example, you should consider asking your HR representative or even your bank representative to help you achieve the minimum knowledge on the matter.

And trust me, they will all start by saying that you have to make the maximum contribution each month and take advantage of any matching programs in your company.

Check your credit report

Thanks to a very recent law, Americans are now entitled to one free credit report per year, and this is something you should take advantage of. It is so important to remain on top of your credit, because it is used to calculate every little aspect of your life, from your rent, and your insurance rates.

It is ideal to aim for 710 or even higher. But don’t stop at the top number! You should look over the entire report for old loans you might have forgotten about, as well as outstanding bills, mistakes, and even evidence of fraud. All these problems might take months to fix, so we strongly recommend you start cleaning them up as soon as possible.

Set up a monthly budget

As an expert once said, everything was much easier when we had to balance our checkbooks regularly, because budgeting made more sense to us. Given the fact that now everything can be done on your gadget, you can easily lose track of what’s coming in or going out of your bank account.

Not to mention that owning multiple accounts will only make budgeting a little harder because you have to keep track of all of them. However, if you do have more than one account, it’s even MORE important to check them.

And don’t worry, you don’t have to make a complex spreadsheet! If you don’t like the idea of writing down on a piece of paper (although look at this cute finances agenda, who wouldn’t want to write in it everyday?!), many cool new apps can help you track down your accounts.

Close the ‘student loans’ chapter

The average class of 2018 graduates has to pay $29,800 in debt. But as you probably know, the loans students didn’t manage to pay because school was too demanding will suddenly become a great financial burden.

According to a financial expert, the first step is to separate your loans into federal and private. Then, check online if you are eligible for the most recent programs that are set up to consolidate and reduce payments for federal loans. If you keep your loans privately, contact your lenders and see if you can negotiate better terms.

Buy term life insurance

Life insurance, such as retirement accounts, is another concept that many people are running from. However, it doesn’t have to be so complicated. “You only have to purchase 20 to 25 years’ worth, and then, when your kids will graduate from college (if you have any), you can stop.”

There are a ton of affordable options, and this is probably the best thing you could do for yourself and your loved ones.

Start investing in real estate

There are more young adults today that are willing to stall spending their money on a home and rather go for renting, which is, in their opinion, more flexible. However, it is a mistake, because real estate isn’t only for wealthy people!

The return on a home is constantly getting better than the stock market. The only thing is that you have to have enough money saved, in order to afford a 20 percent down payment.

Live within your means

This is probably one of the most important principles when it comes to personal finances. However, it seems that many of us have a very hard time applying it. In reality, it’s all about finding smart ways to increase your income and decrease your expenses.

Given the current Internet-based world, finding such opportunities and strategies isn’t completely impossible. You can easily start by purchasing all sorts of things from Craigslist, or even set up a small store on Etsy, where you could easily sell all your hobby stuff!

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