The new rules of money, beyond the house deposit

Once upon a time, there were fairly clear rules for money by your age. Your 20s were for saving a house deposit and buying your first home. Your 30s and 40s were about paying down the mortgage, raising a family and gradually building investments. In your 50s and 60s, your focus shifted towards preparing for retirement, and once you got there, your life was about measured enjoyment of your savings and perhaps planning to leave something behind for the next generation.

The world has changed and, for the most part, those rules no longer apply.

A few stats to consider…

• The cumulative inflation rate between 2005-2025 has been 73.19%, meaning that $100 then is equivalent to $173.19 today.
• Home values have jumped by 43.9% at the combined capital city level in Australia
• It takes longer than in the past to repay university debts; in fact, 40% longer compared to 2005-6 data.
• People are also having fewer children, if at all, and childcare costs have more than doubled in the space of 20 years.

What this all means is that for many, saving for and buying a home in their 20s might not be a realistic goal, or that retirement might mean still working some hours.

It’s not all bad news, though.

We have better access to investments and financial education than ever before. For example, back when ETFs first launched on the ASX in 2001 (and there were only 2), there were just over 1 million Australians registered with an online trading platform. These days, there are over 400 listed ETFs and around 53% of Australians use online trading platforms

A changed world means we need to rethink our financial goals. I spoke to Josef Jindra, Financial Adviser at Mintwell, about what the money goals should be for each decade and stage of life today.

He believes that financial success today is “about creating a roadmap that fits your lifestyle, goals and values.”

Financial goals for your 20s

With more young Australians staying at home longer or struggling to find affordable rent, Jindra says it is less about chasing a deposit. Rather, he believes it is about establishing financial habits that will stand you in good stead for life.

“I always tell clients in their 20s that time is their greatest asset. The earlier you start, the longer compounding works for you, and the greater your financial resilience becomes,” he says.

He finds the biggest mistake people typically make in this age range is waiting until they earn more before starting to save or invest.

“A regular savings habit, whether into an emergency fund, superannuation or a small investment portfolio, builds both discipline and confidence,” he explains, adding that consistency is more important than the size of what you can save.

He wants people to make sure their superannuation is sorted – consolidate, don’t have accounts everywhere – and to make sure you are invested in the right option and that the investments align with your values, particularly if you want an ethical or ESG focus.

For those young Australians feeling depressed about home ownership, Jindra also has a positive message.

“Property is no longer the only path to wealth creation. With the rise of affordable and accessible investment platforms, young Australians are proving that discipline investing through superannuation, ETFs or managed funds can build significant wealth without immediately buying a home,” he says.

If you want some guidance on what an investment portfolio could look like for your 20s-40s, read this article by Livewire’s Tom Stelzer: How to invest when you’re under 40.

Getting more complex – your 30s and 40s

“These decades are typically about balancing family life, home ownership, career growth and competing financial priorities,” Jindra says.

He believes this is where structure and a budget become important – and where you (hopefully) continue the good habits you established in your 20s.

“You should know where your money goes and how it’s working for you,” he says.

There’s a free budget planner available at MoneySmart.gov.au if you are looking for a starting point (and yes, it's available as a downloadable Excel spreadsheet). You can also find loads of free planners - chances are your bank will offer one. 

This is also the stage of life where insurance is essential.

“Your income is your greatest financial asset, and protecting it ensures that if something happens – illness, injury or worse – your financial stability and family’s future are not at risk,” he notes.

You can consider insurance through your superannuation or outside it. Using insurance within your super means a portion of your balance will be used to pay your insurance costs – check what level of cover you currently have. You can opt out of insurance within your superannuation and consider alternatives outside.

There are typically three options available: life cover (where a lump sum is paid to your beneficiaries if you die) and total and permanent disability (TPD) insurance (which pays a lump sum if you become totally and permanently disabled due to illness or injury) are usually automatically included.

The third option – income protection insurance – is not always automatically included.

This is where the fund will pay some of your income if you are unable to work for an extended period due to illness or injury. It can be valuable if you have no other income or buffer should something go wrong, but you should take the time to really understand it, the costs, and the alternatives.

Superannuation laws changed back in 2019, meaning insurance wasn’t automatically provided to members aged under 25 unless they worked in a dangerous job or the balance was below $6,000. You can contact your superannuation fund to discuss opting in, if relevant to you.

The refining process in your 50s and 60s

The retirement age is often pegged to when you can first receive the Age Pension (if eligible), and this has gradually risen over time. Currently, you must be at least 67 years old, though it’s worth remembering that this has changed and could change again.

You can access your superannuation from the preservation age of 60 years if you have stopped working.

This all means the goals of your 50s and 60s haven’t changed too much compared to the past. It’s all about planning and preparing for what retirement might be, along with considering what changes you can make to meet your goals.

“Many people in this stage have accumulated significant assets but haven’t optimised them. This is the time to review your superannuation fees, performance, contribution strategy, and risk profile. They matter more than ever,” Jindra says.

He reminds investors to consider strategies such as salary sacrifice contributions or transition-to-retirement (TTR) strategies, as well as estate planning.

“Wills, enduring powers of attorney, and binding death benefit nominations ensure your intentions are clear and your family is protected,” he adds.

“At this stage, financial advice becomes as much about efficiency and protection as it is about growth.”

As a quick refresher, when it comes to contributions to superannuation…

• You can make concessional contributions (that’s from pre-tax salary) to your superannuation of up to $30,000 per financial year. Don’t forget this includes superannuation guarantee payments that your employer makes on your behalf. If you haven’t used the full cap in previous years, you may be able to “carry them forward” to increase your cap to a certain amount and according to specific conditions.
• You can make non-concessional contributions (that’s from after-tax salary) to your superannuation of up to $120,000 per financial year. You might be able to “bring-forward” an additional two years of your future cap to contribute in one year, depending on your age and total super balance.
• If you are aged 55 years or older, you could contribute up to $300,000 from the proceeds of selling your home to downsize into your superannuation. It is a non-concessional contribution that doesn’t count towards the non-concessional contribution cap but does count towards the transfer balance cap (how much you can have in the retirement phase account balance of your superannuation, which is currently $2 million for financial year 2025-26).

You may also want to look into options such as Government co-contribution payments (if you are a lower-income earner) and spouse super contributions.

Retirement

Jindra describes this as a new chapter of the financial journey, rather than the end. After all, you still need to contend with inflation and other circumstances, so you’ll still need some exposure to growth investments as well as reliable income streams.

“The goal moves from accumulation to sustainability: making sure your money lasts as long as you do,” he says, reminding investors to stay engaged, review their strategy and continue to adjust as life evolves.

For some, retirement may also mean continuing to work in some format to give them more flexibility in their lifestyle and choices and help their funds last longer. There are also mental well-being and social benefits to this.

The principles that never change

Regardless of age group, Jindra highlights that some rules of money don’t change.

“Controlling cashflow, investing for the long-term, and protecting what you’ve built remain timeless. You can’t grow what you don’t understand and you can’t protect what you haven’t planned for,” he says.

He also reminds investors that regular review is important – set-and-forget is not an option.

“Life changes, income changes, families evolve, markets move, and laws shift. Even the best financial plan can drift off course without regular review,” he cautions, but adds that a yearly check-in can make all the difference.

The new rules of money? Flexibility, careful habits, diversification and planning ahead.

What’s better? These ones don’t ever go out of fashion.