Maximizing your paycheck in your 30s and 40s is a priority during this time when your income tends to rise. You may have discretionary income for travel and hobbies, and the challenge is to find the right balance between spending and saving.  The financial decisions you make now will have the greatest impact on the lifestyle you will enjoy during retirement.  

1. Establish a monthly budget (and stick to it!).

With many expenses, a monthly budget can help you control how your money is spent, rather than it controlling you. Since most bills are due monthly, it's helpful to establish a monthly budget containing all your current bills and expenses including things you may not get a bill for like groceries, hobbies, clothing, etc. Allocate an dollar amount for each line item and categorize all the expenses into similar buckets like "entertainment" or "home maintenance." The only way to make a budget work is to include everything you spend in the budget and to stay within the budgeted amounts. But don't forget to pay yourself first! See step 2 below.

HomeTown Bank’s Our Cash FlowTM is a helpful budgeting tool. Our Cash Flow connects to almost every US financial institution with internet banking capability so you can see all your accounts in one place, set up budgets and goals, track spending, and more so you can understand your complete financial picture. Learn more here.

2. Pay yourself first.

One of the best personal finance strategies is to pay yourself first. By continuing to set aside a portion (at least 15 percent) of your income for savings and retirement on a consistent basis, you will create a more secure financial future.

Goal Setter Savings – An automatic savings account that helps you save by drafting from your HomeTown Bank checking account.

3. Open a checking account for the way you live.

Conserve time, money and paper with HomeTown Bank’s convenient checking accounts with online banking and bill pay as well as free debit cards and no-charge ATM services.

Advantage Interest Checking – This account has preferred rates that reward you for using HomeTown electronic banking.

Star Checking – This is a premier high-yield account with full checking privileges that earns a money-market return.

4. Make a plan to eliminate debt.

One of the best ways to build wealth is to eliminate unnecessary debt. One of the best ways to do that is to list all your debts, in order from the smallest balance to the largest. Pay the minimum balance on the largest debts, with the exception of the smallest one - that is one you should aggressively pay down. As you eliminate the first small debt, move on to the next until you are eventually debt-free. 

Borrowing for a home usually makes a lot of sense because it's an automatic savings plan. However, based on your current principal and interest rate, it may make sense to refinance. Check out this calculator to see how much interest you can save if you refinance your mortgage.

5. Save for retirement.

Many people underestimate the amount of money they’ll need in retirement. Be realistic about major expenditures, e.g., will your mortgage be paid off by retirement?  If so, you may need less income than you do now.  Do you plan to buy a vacation home or travel extensively?  Will you have to pay for your own health insurance?  These and other financial considerations all come into play.  

HomeTown CDs – Maximize your return by locking in a competitive rate for a chosen term.

Personal Money Market – Earn higher interest rates while having the ability to access your money at any time.

HomeTown IRA –  IRAs are a smart tax-advantaged savings option to help you build your retirement.

Retirement Calculator – Access a helpful retirement calculator here.

6. Understand your credit report.

Your financial behavior over the past seven years, including how much credit you have, how long you've had it and whether you pay your bills on time is information included in your credit report. Three credit reporting agencies — Equifax, TransUnion and Experian — maintain these reports, and lenders buy them to help them decide whether to offer you a prequalification.  Your credit report also carries your credit score ranked between 300 and 850 that many lenders use to decide whether you are creditworthy and will repay a loan as well as the interest rate you pay. Your credit score is available from the three credit reporting agencies: 

Equifax –
TransUnion –
Experian –