Emergency fund: A person, who has just started a job, is surrounded by a higher risk of loss of job or any other emergency. To safeguard against such cases, a person should always aim to save at least 3-6 months equivalent expenses. For example, if a person spends Rs. 20,000 per month then he should maintain at least Rs. 60,000 to Rs. 100,000 in a savings or a debt fund.
Focus on repaying education loan: Before falling in the trap of credit cards or buying gadgets on loan, a person should concentrate on repaying education loan. The banks have become little stringent on education loan defaulters and thus, one should not take the case lightly.
Time for savings: A young income earner has fewer responsibilities and thus, enough room to target higher savings. It is a universal truth that the rate of savings are impacted from family responsibilities and with age. Therefore, one should target to save as much as 50% of their income during the early stages of the career.
Spending could wait: A person, who has just got into a job should overcome the yearning of spending on unnecessary items. For beginners, getting a monthly salary in hand is an exciting life event, especially, if they have been living on meager pocket money before their jobs. But, spending is not a great idea.
Proper strategy: Saving is important, but a proper investing strategy is equally important. One should not save and let the money lay idle in bank accounts. Investing the sum into funds according to risk profile is a core task.