Published on 25/04/2022 5:58:31 PM | Source: Angel One Ltd

Investing the First Lakh you’ve Earned

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The sense of satisfaction drawn from receiving a salary is incomparable. After all, it is symbolic of the effort that you put into doing your job. Now, while each pay cheque is rewarding in its own way, the higher a pay cheque the more valuable it is. In India, for instance, earning ₹1 lakh is a big deal, however, only a handful of people are fortunate enough to have this earning capacity. If you are lucky enough to earn this kind of money, you must consider investing it such that it can provide you with returns in the future. At Angel One, it is possible to learn more about financial planning and investing by taking advantage of the resources it boasts. These range from the Knowledge Center which provides insights into financial planning to Smart Money - an investor education platform. Each of these offerings feature easy to understand modules that are designed to help shed light on the stock market. Beginners, as well as experienced traders and investors stand to benefit from this content.

Prior to starting your investment journey and incorporating any of the suggestions mentioned below, it is worth preparing a sizeable emergency fund that can support you for 6 months.


Pay off Outstanding Debt – The first course of action you should take if you have the funds to spare is to clear any debt that you might have. This debt could be in the form of outstanding education, car, or home loan among others. Unpaid debt can lead to complications when you attempt to invest your money. While returns aren’t guaranteed from investments, interest payments on investments are a must. Therefore, it is imperative that you clear your debts prior to investing your money in the stock markets.


Purchase a Comprehensive Health Insurance Plan - The value of investing in a health insurance plan lies in the fact that it helps financially safeguard you and your loved ones. This insurance plan will provide you with the funds needed to expense your medical bills. Purchasing such a plan while you are young and healthy works in your favour as you are likely to be in a healthier state owing to which you will have to pay lower premiums in comparison to those who are elder than you.


Select a Systematic Investment Plan – Such plans allow you to diversify your portfolio as they incorporate debentures, stocks and mutual funds. Mutual funds happen to be particularly safe investments as they make it possible for you to amass returns over time.


Opt for Tax-Saving Products – Here, equity linked savings schemes stand out as they allow you to attain long-term financial goals that you set your sights on. They are classified as tax-saving schemes as they permit you to accrue adequate returns while simultaneously allowing you to save on your taxes.


Wrapping Up


Ultimately, while a ₹1 lakh salary may seem like a big figure, it can dwindle down to a limited amount once your household expenses and frequently occurring bills have been deducted from this figure. Keeping this in mind, it may also make sense to invest a small amount in something that you are passionate about like an interest or a hobby. You then have the option to monetise whatever new skill you cultivate.


Learn how to save, invest and tackle the financial markets on the Angel One website. It is also important to cultivate a habit of saving a certain amount of your salary such that it can be used as an emergency reserve in case you run into any trouble. These savings can also be invested over time such that you are able to increase your holdings..


1This blog is exclusively for educational purpose

2Investments in securities market are subject to market risk, read all the related documents carefully before investing. Brokerage will not exceed the SEBI prescribed limit.


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