There is never a better time to start building wealth than the present.

But how to go about it depends on your age.

“The better you work to create your financial security, the more flexibility it gives you to make better choices in the future,” said Certified Financial Planner Carolyn McClanahan, MD and Founder and Director of Financial Planning at Life Planning Partners, based in Jacksonville, Florida.

Here’s a decade-by-decade guide to increasing your wealth.

The first thing to do is to create an emergency fund. If your job is very secure, aim to save three to six months in expenses. If it’s unsure, like a commission-based sales job, try working for six to 12 months, advises McClanahan.

If your employer has a 401 (k) plan and offers a match, contribute enough to get that match.

After that, open a Roth individual retirement account, if your income qualifies, McClanahan said. In 2021, you can contribute up to $ 6,000.

If you still have money to save after maximizing your Roth, contribute more to your 401 (k). In 2021, you can put up to $ 19,500 in the account.

At this age, you may have more stocks than fixed income in your portfolio because you have more time to recover from a downturn in the markets.

Finally, make sure you are well insured, especially in auto and disability insurance, because an accident or a health problem could wipe out your savings.

As you progress in your career, don’t fall victim to the ‘lifestyle creep’ and start spending that recovered money, warned CFP Matt Aaron, founder of Lux Wealth Planning, a subsidiary of Northwestern Mutual. , based in Washington, DC.

Instead, increase your 401 (k) plan contributions. The rule of thumb is to set aside about 10% of your income, if you’re starting out young, but a financial professional can help you figure the numbers, he said.

Once you’ve maximized those contributions, start investing outside of your retirement account. Your portfolio should be diversified, with a mix of stocks and bonds.

Historically, stocks have earned around 7% a year, adjusted for inflation, so it’s important to invest instead of letting them sit in a savings account or under your mattress, said CFP Elaine King, Founder. of Family and Money Matters in North Miami, Florida.

“Every 10 years the money has the power to double,” she said.

More Investing in you:
How To Find Your Best Spending Rate In Retirement
Childcare costs, lack of paid leave hold back many working parents
What you need to know before you start investing

You might also be thinking about buying a house, getting married, or having children. When you start saving for these events, don’t invest in stocks unless your time horizon is longer than five years, advises McClanahan.

Instead, she recommends a money market account, which won’t pay big returns but isn’t as risky as stocks.

If someone is relying on your income, such as a spouse or a child, now is the time to get life insurance.

You are potentially now in your peak earning years and you may have to face the cost of raising children.

You can also have elderly parents, so check their financial planning, suggests McClanahan. If they’re not prepared, that’s another financial obligation that can suddenly be thrown in your lap.

Evaluate all the savings you have made for your children. If you haven’t started yet, don’t divert savings from your retirement account if you can’t save for both.

“You can borrow for college, but you can’t borrow for retirement,” McClanahan said.

For those who haven’t yet started saving for retirement, setting aside 15-20% of their income is considered a general rule at this age, Aaron said.

It’s also a good time to start thinking about a sideline to improve your income beyond your job, King said. Think of it as a Plan B if you lose your job, as well as something you can continue when you decide to leave, she said.

Retirement is potentially a decade away, so it’s time to take seriously how much you’re really spending and whether you’re on the right track to saving enough to support you throughout your life, McClanahan said.

Once you hit 50, you can also put more aside in your 401 (k) or IRA with so-called catch-up contributions. For 401 (k) plans it can reach $ 6,500 for 2021 and for IRAs it is $ 1,000 for that year.

If you’re not using a financial planner, get at least a schedule to determine if you’re on track to supporting your retirement lifestyle, she recommends.

Evaluate your assets and make sure your portfolio is balanced against your needs. As retirement age approaches, experts generally recommend cutting risky assets, like stocks, and increasing fixed income, like bonds.

However, it’s important to maintain exposure to equities because it gives you a better return, Aaron said.

King actually recommends considering alternative investments, such as startups or real estate. They could complement your stock and bond portfolio and add diversification if the market goes up or down.

At this point, you need to have a pension allocation strategy, Aaron said. It means understanding the different sources of income that you will have.

“We need to develop an investment strategy based on an appropriate asset allocation, taking only the risk necessary for the income you need and your wealth goals,” he said.

If you are concerned about taxes, consider investing in fixed income instruments tied to municipalities, such as municipal bonds, King said. They are not taxed at the federal level.

It is also important to understand the best option for you to claim Social Security. Too many people take it at 62, which is as early as possible, McClanahan said.

However, you are only entitled to full benefit at full retirement age, which is 67 for people born in 1960 or later. If you delay taking benefits from 67 to 70, your amount will increase.

“Delaying this is the best investment you can make in your future,” McClanahan said.

She recommends that those who are in good health and have a high probability of living to age 80, wait to age 70. The payback is an 8% growth per year, she said.

However, it gets complicated for married couples, and it’s usually better for one to claim earlier and the other to delay, she noted.

SUBSCRIBE: Money 101 is an 8-Week Financial Freedom Learning Course, delivered weekly to your inbox.

CHECK: I used to owe $ 40,000 and now I’m on track to retire at 65 with over $ 1.5 million: here’s my best advice via Growing up with Acorns + CNBC

Disclosure: NBCUniversal and Comcast Ventures are investors in Tassels.