Enter for a chance to win $5,000!

Skip to Main Content

How to Build Wealth at Any Age

Trips to visit grandkids, travel adventures and family celebrations at your paid-for home. That’s the kind of retirement many Americans dream about.

You don’t have to earn six figures to turn this dream into a reality. But you do have to live and plan today with that goal in mind. Building wealth starts with proper planning at every stage of your life. You can do this!

The 4 Keys to Building Wealth 

Whether you’re 25 or 52, some things are true no matter how old or young you are. Sure, we face different challenges and priorities at different stages of life, but some truths are foundational and constant at any age.

These four keys to building wealth are like that, and they’ll help you unlock and unleash your wealth-building potential. Ready? Let’s do this!

1. Getting Out (and Staying Out) of Debt

Let’s get one thing straight: The only “good debt” is paid-off debt. The more money you send to banks in loan payments, the less money you have to save and invest for your future.


How much will you need for retirement? Find out with this free tool!

And trying to save and invest while you’re still in debt is like running a marathon with your feet chained together. Get debt out of your life first. Then you can start thinking about building wealth.

2. Having a Fully Funded Emergency Fund

Whether it’s a job loss, a car wreck or a broken leg sliding into second base at a company softball tournament, life is going to throw you a curveball someday. Maybe not today. Maybe not tomorrow. But believe us, it’s going to happen!

That’s why you need to have three to six months’ worth of expenses set aside in a savings account before you start investing. And don’t touch it unless it’s a real emergency (Christmas shopping is not an emergency, people!).  

3. Investing 15% of Your Income for Retirement

Now it’s time to go on offense! Being debt-free and having money in the bank to cover emergencies gives you the foundation you need to start saving for retirement. Start by investing 15% of your gross income into retirement accounts like a 401(k) and Roth IRA.

When our team completed the National Study of Millionaires, we found that 3 out of 4 millionaires (75%) said that regular, consistent investing over a long period of time is the reason for their success. Building wealth doesn’t happen overnight!

4. Paying Off Your Home Early

Speaking of millionaires, we also found that the average millionaire paid off their home in 10.2 years, and two-thirds of them (67%) live in homes with paid-off mortgages. That’s not an accident!

Imagine what you could do if you didn’t have to worry about a mortgage payment every month . . . we're getting chills just thinking about it! With a paid-for house, you could really build some momentum and accomplish your financial goals even faster. Who knows? You might even be able to retire earlier than you planned! 

How to Build Wealth at Any Age

Take a second to think about what your life was like 10 years ago. Things probably looked a lot different back then, right? Maybe you were still in college. Maybe you weren’t married yet and didn’t have any kids. You might have even had a completely different career and salary.

Now let’s talk about the future: What do you want your life to look like 10 years from now? That’s a lot to think about! But listen: A lot can happen in a decade, and what you do right now—no matter what age or stage of life you’re in—will have a huge impact on where you are 10 years from now.

Here’s a decade-by-decade look at what you can do to maximize your savings potential.

How to Build Wealth in Your 20s

You’re a millennial. What does retirement have to do with you? A lot, actually. Because you have the most to gain when it comes to retirement. There should be no stopping you when it comes to building wealth because you have the one thing other generations don’t: a lot of time.

Here’s a scenario: Let’s say you begin investing $200 a month at age 24. But your friends, who bought new cars and took dream vacations on credit cards, delay saving for retirement until age 34 while they pay off their debt. At age 64, you’d have around $1.7 million in retirement savings. However, your friends would only have $560,900. That 10-year head start makes you a million dollars richer!

If you’re in your 20s, you’ve got a great opportunity to create a solid foundation for your future. Don’t waste it!

Want to build wealth beginning in your 20s? Here’s how:

  • Steer clear of debt. If you have debt, use the debt snowball to knock it out of your life as fast as you can—student loans included. If Sallie Mae is living in your spare bedroom, kick her out ASAP. 
  • Live below your means. Just say no to things you can’t buy with cash! Overspending every month can dramatically impact your ability to save for retirement. 
  • Raise your standard of living slowly. This is not the time to grow leaps and bounds in houses or cars. Paid-for clunkers and small apartment rentals will do just fine while you secure your financial footing. 
  • Budget like your future depends on it—because it does. A monthly written budget assigns every dollar a specific purpose. Budget categories include things like food, clothing, housing, bills and savings. Plus, a budget ensures you’ll have the money for the things that are important to you, like fun money and retirement savings. 
  • Start early. As you can see in the example above, it doesn’t take a lot of money to build a million-dollar retirement—as long as you start early! Your goal is to invest 15% of your income for retirement. And the earlier you start, the better! That’s a wealth-building habit that will pay off not just in dollars, but in opportunities for you down the road.

How to Build Wealth in Your 30s

For folks in their 30s, life is in full swing. You might have kids, a mortgage and monthly expenses that seem to eat away at your income. Saving for retirement could easily take a back seat to everyday living expenses. That’s not okay!

Here’s the truth: Life never gets less expensive, and saving never gets any easier from here on out. You’ve got to commit to carving out the money and sticking with your saving and investing habits. You can do this!

If you’re a 30-something, consider these wise moves:

  • Watch your housing budget. If you’re unable to pay cash for your house, remember to spend no more than 25% of your monthly take-home pay on a 15-year fixed-rate mortgage. Don’t make the mistake of becoming house poor, especially at the expense of not being able to save for retirement. 
  • Have your emergency fund securely in place. Keeping adequate savings on hand guards you against dipping into your retirement fund or going back into debt when an emergency happens. And it will eventually. 
  • Max out your retirement savings options. If your employer offers a 401(k) match, contribute up to the match, and then fully fund a Roth IRA. Your goal is to save 15% of your gross household income for retirement. 
  • Save for retirement before you save for your kids’ college. Your kids may or may not go to college, but you will retire someday. So, make saving for retirement a priority over saving for college if you can’t afford to do both.

How to Build Wealth in Your 40s

A recent study reported that Generation X workers, which includes workers currently in their 40s, have saved $66,000 across all their retirement accounts.1 That’s not going to cut it! Realistically, you’ll likely need enough savings to replace 80% or more of your preretirement earnings to maintain your lifestyle throughout your golden years.

If you’re not where you should be with your retirement savings, you’re not alone. Many Americans are in the same boat. But now it’s time to get serious about your future.

 Here are three ways to get back on track:

  • Know your portfolio. Meet with a financial advisor and make sure you’re investing the recommended 15% of your annual income in retirement accounts like a 401(k) or a Roth IRA. Automate your contributions if you’re not already doing so. Every time you get a raise, add it to your retirement savings. 
  • Don’t borrow money from your retirement account. Find other ways to pay for unexpected medical bills, home improvements and college expenses. Raiding your 401(k) will sabotage your retirement savings, and if you lose your job and still have an outstanding 401(k) loan balance, you probably have to pay that money back very quickly. Don’t do it! 
  • If you have a mortgage, start paying it down. If you have a $250,000 balance on a 15-year fixed-rate mortgage with a 4% interest rate and you can pay an extra $300 each month, you could pay off your home two-and-a-half years early. The goal is to create a mortgage-free retirement as soon as you can and boost your retirement savings to make up for lost time.

How to Build Wealth in Your 50s

According to a study conducted by Ramsey Solutions, 53% of working baby boomers who aren’t currently saving for retirement have no plans to save.2 It’s time for boomers to wake up!

You need to take advantage of the retirement savings opportunities that come with age. If you don’t, you’ll face a financial crisis in retirement. So, if you find yourself in your 50s with little or no savings, this is the time to play some serious catch-up.

Some options include:

  • Annual catch-up contributions. If you’re 50 or older, you can invest an additional $1,000 in your Roth IRA for a total of $7,000 each year.3 You can also invest up to $26,000 in your company’s 401(k) plan.4 
  • Think about ways to downgrade your lifestyle. With your kids getting ready to spread their wings, go to college and start their careers, you and your spouse will probably become “empty nesters” sometime in your 50s. Now might be a good opportunity to look at downgrading your house (do you really need four bedrooms?) or look for other areas where you can cut expenses so you can put more money toward retirement. 
  • Health insurance. The likelihood of needing medical care increases with age, so be sure to keep at least basic medical insurance coverage at all times. One major health crisis could set you back financially and delay your ability to invest more for retirement.

As you reach your late 50s, you might want to start thinking about what you want to do about Social Security. You can claim retirement benefits as early as age 62 or as late as 70. Delaying your claim will increase your monthly benefits. If you can wait until your full retirement age, you'll receive more money each month.

Where Do I Go From Here?

Ready or not, retirement is coming. How prepared will you be when you get close to retirement? That depends on you. You have the power to take the necessary steps to secure your retirement future!

You can start moving toward your retirement dreams today by reaching out to a financial advisor. A qualified professional like one of our SmartVestor Pros can help you create a plan based on your individual needs. 

Find a SmartVestor Pro today!

Want to learn more? Dave's new book, Baby Steps Millionaires, will show you the proven path that millions of Americans have taken to become millionaires--and how you can become one too! Pre-order your copy today to learn how to bust through the barriers preventing you from becoming a millionaire.

Ramsey Solutions

About the author

Ramsey Solutions

Ramsey Solutions has been committed to helping people regain control of their money, build wealth, grow their leadership skills, and enhance their lives through personal development since 1992. Millions of people have used our financial advice through 22 books (including 12 national bestsellers) published by Ramsey Press, as well as two syndicated radio shows and 10 podcasts, which have over 17 million weekly listeners.

Thank you!  Your guide is on its way.

Invest With a Pro Who Gets This Stuff

Invest With a Pro Who Gets This Stuff

Your future is too important for guesswork. Get help from a SmartVestor Pro today.
Find Your Pro

Invest With a Pro Who Gets This Stuff

Your future is too important for guesswork. Get help from a SmartVestor Pro today.
Find Your Pro