Investment mantras for all gen Z starting a career

financial instrument

financial instrument

If you have started earning recently, we understand, you have your dreams and wishes to fulfill. You may want to travel around, buy gifts for your loved ones, and much more. Everyone should definitely fulfill their dreams.

However, there is one thing most people miss to put on their list when they start a career – Investment. Yes, it is the last thing that comes to someone’s mind when they start earning.

In this article, we will discuss – why it is important to start investing early and some investment mantras?

Why start early?

If you ask any investor who is in their 30s – “What do you wish you had done differently in your early or mid-twenties?” 

You will receive the same answer, “I wish I started investing early.”

When you start earning, you may think your salary is low for investment. Hence you postpone investment for the right time. However, it is a wrong mindset – As your salary increases, so do your responsibilities (with age). Hence, there is no right age to start investing. If there is – it is NOW.

It is more about the habit and understanding the importance of investing. People understand the importance of late, and hence they start late. So, all you need to do right now is understand the importance of investing.

Let us attempt to help you understand in a few lines – Let us assume you want to retire at 50. You need to know, the life expectancy in India (and around the world) has increased. It means, on average, a person will live more years. If you are retiring at 50 and you live up to 80 years, you will need a higher sum of money to live your second inning comfortably.

To manage 30 years of retirement, let us assume you require Rs 5 crore at 50 (it is not too much, consider inflation, and you will know it is a moderate amount). If you start investing at the age of 30, you will need to invest Rs 50,000 per month (at 12% return) for the next 20 years. However, if you start investing at the age of 23, you will need to invest only Rs 20,000 per month (with 12 percent returns).

Few points related to the above example – 

If you have not invested till now, you should start immediately after reading the above example. 

Below are some investment mantras for all the millennials out there – 

Clear of your loans – If you have any existing student loans, you should clear your loan – as soon as possible. If you have three years to clear off the loan, try to do it in 18 months. Clearing the loan early, in a way, is investing.

Learn Investing – It is essential for every person looking to create wealth over time. You don’t have to spend hours doing it, and it does not have to happen overnight. It is an ongoing process. The important thing is you start the learning process. To begin with, all you need to do is understand different investment options. It will help you in investing in the right financial instrument.

Get into the habit of investing – The truth most people don’t understand – you can create wealth even with a small amount. You need to get into the habit of investing. Start investing with whatever amount is possible for you and stay invested. It should not be like – you invest today and withdraw your money next year. 

Emergency corpus – To ensure you don’t have to touch your investment, you should create emergency funds. An emergency fund should be completely liquid and only be used in case of an emergency.

Stay away from fixed deposits – You would have seen your parents talking of fixed deposits when it comes to investing. However, the time has changed, and fixed deposits are no longer an investment option (low returns). You can keep your emergency funds in fixed deposits, but other than that, you should have limited exposure to FDs.

Get insurance – Get health as well as life insurance. Everyone takes it at some point in time. However, if you take it early, you not only secure your life but also get insurance at a lower premium amount.

Know your goals – A long journey without goals may not stay interesting for long. Hence, you should invest according to your goals. Once you understand investing in some detail, you can go ahead and create goals like buying a house, foreign vacation, retirement goals, etc and invest accordingly.

If you are new to investing and have no clue where to invest -you may consider equity. Equity is a risky investment but as you are young, you can afford to take some risks. 

Jarvis Invest uses Artificial Intelligence to create a stock portfolio for you as per your risk-taking ability and investment horizon. You don’t have to worry about anything. The platform also tells you when to exit a stock. If you start early, you will attain financial freedom much before your peers.

You can explore more about us by downloading our app.

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