The first job marks the beginning of a new phase of life – becoming financially independent. You have just made the leap from pocket money to earning your own money.

It is a new high and you are free to use your money the way you wish without worrying about the ‘hard-earned money’ gibe by parents. 

The first salary wipes out within a week of getting credited, and you have just managed to get some gifts for your loved ones and treat your friends and family. The second salary goes into pampering yourself. It is well deserved, given all those years of rigorous studies and hard work that have brought you here.

In six months, you get used to your earning-spending routine. Now, is the time, if not earlier, to begin financial planning, i.e., learning how to manage your money and developing healthy financial habits.

Good health and adequate wealth are the two essentials for a happy life. And hence it is crucial to develop good habits that contribute to both these dimensions.

An early start in financial planning helps foster healthy financial habits and gives your investments the power of time, which can deliver exponential growth. To begin is half the work done. Rightly so, because most of the time, we don’t know where or how to begin.

So here are five essential rules to help you make a start:

Have a plan

‘Failing to Plan is Planning to Fail’ – a saying that emphasises the importance of planning like no other. Planning provides direction, helps make decisions and encourages action. When you begin financial planning early in life, you have time to take investment risks, learn from probable failures, and gain from the power of compounding.

Save first

‘Do not save what is left after spending but spend what is left after saving.’ This rather famous quote from Warren Buffett, one of the most successful investors of all time, is worth treasuring as a guiding principle for life. It is easy to go overboard with expenses when you have just started earning and a thousand things are calling for attention….

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