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3 money moves you should take before 40

CNBC Select offers 3 financial habits you should develop by the time you turn 40.

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By your 40th birthday, you're likely more financially stable than you were in your younger years — and hopefully that gives you the opportunity to achieve big goals like buying a home and growing your family.

But it's important not to lose sight of future goals, including saving for retirement.

To retire by age 67, experts at retirement-plan provider Fidelity Investments suggest having three times your income saved by the time you turn 40. This guideline includes your cash savings, retirement contributions and any investments.

If you feel overwhelmed with how to get there or what to exactly focus on, CNBC Select has some guidance. Below are three good financial habits to develop in your 30s to help you achieve bigger long-term goals.

1. Increase your retirement contributions

There's a good chance that when you land your first full-time job in your 20s, you only put a small percentage of your salary into your 401(k) retirement account.

But your salary has likely increased in your 30s, and as you enter your 40s, see if you can increase your contributions. Generally, financial advisors recommend contributing 10% to 20% of your salary toward your retirement fund.

Make sure you are putting away enough of your paycheck into your 401(k) account to receive any employer matches, if your company provides one. For example, if your company offers a 6% match, try to put at least that much away and increase it a little bit every year.

And if your employer doesn't offer a 401(k)-sponsored plan, consider putting money away in individual retirement accounts like a traditional or Roth IRA.

Learn more: Here’s how much money you should have saved at every age

2. Start saving for your kids' college early

Parents in their 30s shouldn't forget to keep their kids' college savings in mind at the same time they're saving for retirement. College savings for your children might not directly correlate to your own retirement savings, but starting a college fund early on can free up money in the later years and help you avoid paying interest on student loans in the long run.

Consider contributing to a 529 plan to help fund your kids' college education. These offer tax-free withdrawals when the money is taken out to pay for college. And, depending on your plan, you can often claim state tax benefits each year you contribute to your 529 savings account. There are even credit cards that let you put cash back into a 529.

The Bank of America® Premium Rewards® credit card lets parents who have a 529 account with Merrill Lynch put their cash back toward their children's future college education. The Upromise® Mastercard® offers 1.25% cash back on every qualifying purchase, but when you link your card to an eligible 529 College Savings Plan, you'll earn 15% more on the money you deposit.

3. Put your money into a high-yield savings account or CD

As you near 40, you most likely have a savings account. But it may not be the best one for earning you the most money.

A high-yield savings account offers interest rates much higher than a traditional savings account and allows you easy accessibility to your cash should you ever need it. Using a high-yield savings account in combination with investment accounts helps you stretch your dollars further.

For the best opportunity to earn a high return, check out the Varo Savings Account. The all-mobile bank offers a uniquely tiered APY program that encourages customers to save more, and it has two savings programs that automatically transfer money from your Varo bank account to your savings account.

Learn more: This is the best high-yield savings account for earning and saving more money

Varo Savings Account

Varo Savings Account
Information about the Varo Savings Account has been collected independently by CNBC and has not been reviewed or provided by the bank prior to publication. Bank Account Services are provided by The Bancorp Bank, Member FDIC.
  • Annual Percentage Yield (APY)

    0.81% (with option to earn up to 2.80% if meet requirements)

  • Minimum balance

    None

  • Monthly fee

    None

  • Maximum transactions

    Up to 6 free withdrawals or transfers per statement cycle *The 6/statement cycle withdrawal limit is waived during the coronavirus outbreak under Regulation D

  • Excessive transactions fee

    None

  • Overdraft fees

    None up to $50; anything greater, Varo would decline the transaction

  • Offer checking account?

    Yes

  • Offer ATM card?

    Yes, if have a Varo checking account

See our methodology, terms apply.

Pros

  • High APY and option to earn even higher
  • No minimum balance
  • No monthly fees
  • Up to 6 free withdrawals or transfers per statement cycle*
  • No penalty for overdrafts up to $50 (anything greater, Varo declines the transaction)
  • Option to add a checking account
  • ATM access if you have a checking account
  • Offers 2 programs to help automate your savings

Cons

  • Overdrafts over $50 will cause transactions to be declined
  • Cash deposits are only available through third-party services, which may charge a fee

If you are confident socking away money for a few months, or years, without ever touching it, a certificate of deposit (CD) is another savings option that is risk-free. Typically, the longer the term length of the CD, the higher interest you earn on your deposit. CDs come with fixed interest rates for fixed term lengths. While being locked into a certain interest rate guarantees a return, you have to make sure you are OK with keeping your money untouched because early withdrawals come with penalty fees.

Bottom line

If you are near age 40 and don't have 3 times your income saved, don't fret. Make a plan to increase your retirement fund contributions and make sure you're saving money in an account when you earn interest on your funds. If you have kids, it's never too early to start saving for their education and credit cards can help you do so. Small steps can help you make a big dent in your goals.

Editorial Note: Opinions, analyses, reviews or recommendations expressed in this article are those of the CNBC Select editorial staff’s alone, and have not been reviewed, approved or otherwise endorsed by any third party.