Guide me please

[nluvwyeshua]

25M recently graduated doctor here. Expecting my posting soon and currently preparing for PG entrances meanwhile. I have absolutely zero idea about personal financing, investing etc etc. Someone please guide me from A to Z as to what i have to do, what resources to learn from etc. I feel that whatever useless purchases i had to do (mobile/bike/headphone/etc) i have done in my internship, so future BS purchases are going to be minimal. Please don't judge and help me out.

 

[hillfalk]

@nluvwyeshua I would also recommend reading "LETS TALK MONEY" by Monika Halan. Its a simple book by an Indian author regarding basic personal finance. It covers everything one needs to know to start their personal finance journey

 

[hillfalk]

@nluvwyeshua Hi Doc.

I am new to this field myself but have a family who are financially sound and disciplined. I am earning and investing since about 2 years now. I will try to list the main points here....

• If you can, make a budget and track your expenses.. So you know where your money is going evry month. If you think you are overspending... Just doing this will help you a little with that. Just noting down your expenses will subconsiously help you to trim the unncessary ones.. Speaking for personal experience.
• Make an emergency fund.. Atleast 6-8 months of your monthly expense and keep it in a FD (keep it simple).
• Take a term insurance (upto 60 years) and a health insurance (i dont need to tell you what healthcare costs nowadays and how it destroys families financially)...read a lot before buying them.... Insurance is made to make profits... Make sure you dont buy the wrong one.
• Start investing in Mutual fund... Start with nifty 50 index fund (a fund which invests in the top 50 companies by market cap (not exactly) in India). this is a relatively safer form of investments and has given 12% annualised returns consistently over a long term. FD gives 6%. Nifty 50 index also beats most of the active mutual funds over a long term. Make sure whatever mutual fund you buy, buy a DIRECT plan and not a REGULAR plan. Direct plan costs you less in terms of charges rest everythibg is same. If you buy through a broker, you get a REGULAR plan. Zerodha and Groww will help you get a direct plan.

Whatever money you put in mutual fund, dont think/count on usinf it for 6 years atleast. Markts go up and down and you cannot/should not take your money out when it is down. So keep a horizon of atleast 6-8 years so you give time for compounding to happen, get that 12% returns annualized and then take your money out when the market is good.

 

[nluvwyeshua]

@hillfalk Okay! Thank you, that was a comprehensive guide to get started. I'll start doing some research from today itself so that by the time i get my salary I'd know what to do with it. Thanks again.

 

[revmike10]

@nluvwyeshua All the best for your 1st job

3 steps for you now:

• Take Health & Term Insurance
• Create an emergency fund which covers your 6 months of cost of living
• Start Equity Investment in an Index Fund. Try to buy when the market in down. Don't go after SIP.

Also, start learning about Equity Investment. Start with blue-chip companies to build confidence

 

[nluvwyeshua]

@revmike10 Okay. Thank you so much! Will start doing my research from today itself.