It is not easy to maintain your finance or know what to do with the money you earn. So, here are a few financial abits of advice for young investors and beginners:


  1. Understand that tax saving without buying Insurance Policies-

The starting mistakes made by young investors is when they are investing in tax saving.  Almost every new individual in a company felt that tax could be saved only by buying an insurance policy. Buying insurance policy for covering the risk and automatically tax dating saving will happen. Make sure you do not buy policies to save tax. There are other instruments you can use in investing to save tax that will help you understand over some time, but ensure you keep away from the polices.


  1. Save at least 20% of your income-

save income

Start your saving with about 20% of the monthly income earn. It is very important to develop the method of doing this. Ensure to use any instrument such as mutual funds SIP, PPF, recurring deposit, but make sure to use all of these after understanding the pros and cons. Always keep it simple but make sure to stick to it and never get lured to withdraw the savings, it will be very easy for the ones living with their parents and not for those who have the responsibility of taking care of the family expenses.


  1. Create Emergency fund by any means-

From the 20% of your income savings that you make every month, the very first thing you should do is to accumulate your three-month income and keep it somewhere safe in a liquidable form so that you can manage emergencies like health problems or job loss.


  1. Understand the worth of Money-

The first important thing that young investors have to study is understanding the worth of the money. They should understand that money is what you earn in exchange of your time spent on a productive pursuit. If you earn about $700 per month, meaning in 25 days or 200 hours your earning per hour is $3. When have spent money somewhere, you have to see if that particular spending is worth the time you spent on earning the same. Ensure you respect the money and learn how to be good with money.


  1. Buy adequate insurances for financial backing-

Always make sure that your savings have are backed up by adequate insurance coverage. If you are maintaining financial dependents, then try going with life insurance also, or you should take the accident insurance and health insurance that is needed even if your employer has covered you under their own sponsored insurance coverage. What all is adequate must be calculated and try starting with 20 times of your annual income for the life insurance