Investment tips : Is this your first job? If yes, then you must have got the feeling of being financially independent with the first salary of the first job. But with this happiness comes a responsibility and that is to keep oneself financially independent even further. It is related to your personal finances and future happiness. But many young people do not understand the importance of saving and investing from the very first job. This is the reason why they spend haphazardly and they do not have any roadmap to continue their financial independence further. This problem gets further aggravated when their financial responsibility also increases. In such a situation, the right strategy of saving and investing should be prepared from the first job. Let us see how this is possible.
1. Saving first, then spending
Before spending your salary, you should consider two things. Savings and Investments. The golden rule of saving is to save first and then spend. The strategy of spending first and putting the remaining money in savings is not right. So, first set aside a part of the salary as savings and then spend the remaining money.
2. Early Start, Better Results
The sooner you start investing, the stronger you will become financially. Investing early gives you the power of compounding. That is, your money grows significantly over a long period because interest is earned on the interest of your investment. Einstein said that compound interest is the eighth wonder of the world. So even a small savings can turn into a huge amount in the long run due to the power of compounding.
3. Keep an eye on your bank statement
Whenever a bank statement arrives in our mail, we hardly ever try to open it to see what our spending pattern is. Therefore, definitely check the bank statement so that you can find out where you have spent unnecessary. This will help you control your expenses in a better way.
4. Pay Credit Card Bills on Time
Looking at the spending pattern of the youth, it is found that many people do not pay their credit card bills on time. High interest is charged on credit card dues. This increases your expenditure manifold. Therefore, it is necessary to pay the credit card bill on time. You can auto debit it from your bank account.
5. Early investment means big fund
It’s not just about saving. Savings also have to be invested in the right way. In the beginning, you can take the help of PPF and VPF. PPF is a long-term investment and tax exemption can be taken by investing up to 1.5 lakh annually in it. These are the best instruments for your long term financial needs. It gives good interest as compared to other short term savings schemes. At present, it is getting 7.1 percent interest. VPF means Voluntary Provident fund. Apart from your EPF account, you can contribute more to the PF account through this. Since the interest of 8.5 percent is available in PF, so VPF also gets its benefit. The sooner you invest, the bigger your fund will become.
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6. Mutual Funds and Stock Market
You can also make a big fund by investing in mutual funds and stock market. If the stock market seems complicated to you in the beginning, then by investing in mutual funds through SIP, you can take advantage of the growth of the stock market. Nowadays there are many such fintech companies, which are providing you the best platform to invest in mutual funds. Similarly, there are many apps for investing in the stock market.
7. Diversification of Investment Required
You should focus on diversification of your investment. Diversification means not to put all your investments in one asset. Instead, share it. You can diversify your investments in real estate, mutual funds, stocks and gold and fixed income instruments. With this, you will be able to avoid losses due to fluctuations in the returns of different sectors.