Do You Know These 5 Financial Lessons Most People Learn in Their 40s?

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By the time you hit your 40s, you're supposed to have figured everything out, right? Then suddenly you're 40, and guess what? Life is still pretty confusing. Join the club!

Luckily, learning doesn't stop when you hit the big four-oh.

First, let's review what you've already learned.

In your 20s, you (hopefully) learn and apply financial lessons like the value of compound interest, the difference between good and bad debt, savings strategies like dollar cost averaging, and more. (See also: The 5 Most Important Financial Lessons Everyone Should Learn in Their 20s).

In your 30s, you learn about balancing the budget between big-ticket items like kids, retirement, and home ownership, you choose debt (including mortgages) wisely, align yourself with financial experts, and learn to live within your means. (See also: 5 Lessons Everyone Should Learn in Their 30s).

Now you're in your 40s, and things are changing (again). Some of the ground rules you lived by in your 20s and 30s may not serve you anymore. Here are five financial lessons that generally come to light in your 40s.

1. Risk Tolerances Change Over Time

With some investment experience under your belt and retirement still a long way away, you might be feeling a little more gutsy with your asset allocation, and want to rejig your portfolio to be more aggressive. In other cases, you might have survived a few market (and life) downturns, and are feeling more risk averse.

This is why it's important to have regular financial reviews (ideally with your financial planner) to ensure you're feeling good about your investments, and can track your progress towards your life goals.

2. You're Not Invincible

I remember as a child, falling off my bicycle was a no-brainer: get back up and keep going. Falling off a bicycle in our 40s isn't so easy; we don't bend any more — we break!

You might have had a health scare or serious illness or injury, and if you're lucky it didn't hurt your finances as well. In your 20s, hopefully you took advantage of good health and low premiums to insure yourself. Now it's time to do an insurance review to ensure you're properly (but not overly) covered.

To get started, check out these Financial IQ Tests:

• Financial IQ Test: How Healthy is Your Disability Insurance?
• Financial IQ Test: How Healthy is Your Life Insurance Plan?
• Financial IQ Test: How Healthy is Your Health Care Plan?

3. Your Finances Aren't Invincible Either

Think of your finances in the same way as you and that bicycle. There is less room for mistakes and slack savings strategies the older we get, given that we have an ever-decreasing amount of time to take advantage of compound growth in order to recover. Make sure your financial health is in tip-top shape; recovering from "broken finances" is no easy task.

4. Inflation Sucks

Once you reach your 40s, you understand the real effects of inflation. When you were a kid a candy bar only cost about 25 cents — now it's 500% more at about $1.50! Carry this forward another 30-40 years when you're retired, and that same candy bar will be even more expensive. The money you save for retirement right now needs to go further than you think. Take inflation into account when planning for the future, and ensure your investments are structured to (at least) keep up with inflation.

5. 40 Is Not Old!

40 used to be "the new 30," and now 50 is "the new 40." As we age (and also live longer and longer) we realize that our younger preconceptions of certain ages has been skewed. In your 20s you might have thought that you'd have it all sorted out by your 40s (since you'll be old by then, right?), and suddenly here you are, and you're alive and kicking and still trying to figure life out like everybody else.

Forgive yourself. You're still young. You can change careers, embark on new adventures, and make a few mistakes like the rest of us. Not only that, but you have a long time until retirement yet, so under the premise of asset allocation (and keeping up with inflation), it behooves you to keep a long-term vision for your portfolio.

What crucial financial lessons did you learn in your 40s? Please share in comments!