First Job? Investing Ideas? Here's How You Can Start Investing With Your First Salary

If you have just started your professional journey, the best financial advice you will hear is: start saving early.
Instead of planning your spends, the money-wise should start planning their savings.
Reason: Time is money in the investment world. The sooner you start and the longer you stay invested, the more returns you fetch. 

There are multiple instruments available for you to develop a good savings and investment portfolio, as a beginner. Here are the top seven. 

The top 7 investment possibilities in India are as follows:

Direct Equity
Mutual Funds
Fixed Deposits 
Recurring Deposits
Public Provident Fund 
Employee Provident Fund
National Pension System

How To get started

Financial experts suggest that you should first calculate how much cash you can set aside after deducting your major expenses. To calculate this amount, deduct your monthly take-home salary from your costs. When this figure is known, funding a savings account is simple. As your first investing plan, you ought to open a savings account. Additionally, it might be used as a location to deposit paychecks. To save the amount you've selected as your goal, you have as much time as you need. Put your savings into a fixed deposit as the next stage. The interest rate for the year is 7.25%. This is a simple way to get your feet wet when new to investing. Before making any hasty decisions about where to invest your money, educate yourself on the various investment tools. Your investment strategy may actually be divided into three separate time periods. It may be founded on ideas with different time horizons.

Set a reasonable budget and begin small

First job, first salary: This is the time to enjoy the thrill of earning money on your terms, but it's also the time to learn the value of budgeting and how to divide your funds so they can last from paycheck to paycheck. Since this is your first employment as a newly hired salaried professional, it's best to make steady progress on your savings. Understanding your monthly spending habits and what remains after all expenses have been paid is necessary for this process. No matter how many other important financial obligations you have, you should never underestimate the value of starting small and working your way up to a monthly budget that you feel comfortable with.

Don't put your money in the stock market right away

Stock markets are well-known for being high-risk investments, and there is no guarantee that you will get a return on your initial investment. Because of this, it is wise to resist the temptation of higher returns on investments, especially when you are a novice investor. It is advised that you postpone investing in the stock market until you have amassed a sizeable sum of money from reputable investment sources that are less susceptible to market volatility. Prior to investing in the market, start by establishing a solid bank account and having adequate security. Start taking sensible chances and gradually enter the stock market once you have enough money to cover any emergency.

Set Goals and economise

Your investments should ideally be in line with your short-, medium-, and long-term financial goals. Even if setting these time-bound goals may be challenging while you're young, you should do it.  Saving Rs 1 lakh for a high-end laptop in a year, Rs 4 lakh for a down payment on your first automobile in three years, Rs 20 lakh for a down payment on your first home in five years, and so on are some examples of sensible time periods for saving and investing. Your financial goals determine your investment's size, time frame, risk tolerance, investment products, liquidity requirements and more.

Set aside money for insurance

‍The fact that nothing is constant in life is what applies to health as well. Therefore, its necessary to remember to set aside some of this money for your life and health insurance while you're busy making the most of your money.  These insurance plans can serve as a safety net in case of unanticipated circumstances and can keep you safeguarded from any hardships in life.  

Once you develop the habit of saving and gain some profits from investment sources, you may wish and decide to start investing in the stock market, having a basic understanding of stocks and shares is essential for it. Over time, regular investments and avoiding financial risk can enable you to save a sizable sum of money.

The following advice can assist beginners in setting up money for the future:

• Set Your Objectives
• Level of Risk
• Control Over Emotions
• Study the Stock Market
• Diversification of Investments
•  

Set Your Objectives

Setting long-term goals can be quite advantageous when making stock and share investments. Setting long-term objectives will help you better grasp the value of saving, whether your goal is to prepare for your own retirement, your child's college costs, to purchase a home, or any other purpose. Since the stock market's volatility makes it uncertain whether you will be able to access your money when needed, another investment instrument should be taken into consideration if you plan to invest in a scheme or investment instrument for a short time and withdraw your money after a few years. Your investment portfolio will grow based on factors such as the amount of capital invested, the tenure of the investment and the net annual earnings on the capital. It is advised that you begin investing as early as possible as it can help you save a significant amount of money.

Level of Risk

Before investing your money, you should carefully consider the level of risk involved with the investment option you select. A thorough analysis of the various plans is the best approach to determine the risks connected with various goods and to determine the best alternative. By doing this, you'll be able to determine the level of risk associated with each product and allocate your funds properly. You can avoid investing in items that could cause you to lose money by being aware of the level of risk involved.

Control Over Emotions

Controlling your emotions is one of the key requirements for stock market investment. The price of a company's shares provides insight into how the market feels about it. For instance, if the majority of investors feel pessimistic about a certain company's future, the price of stocks and shares will fall. Similar to this, the values of a company's stocks and shares will rise as investors express confidence in it. "Bulls" are investors who have a bullish outlook on the market, whereas "bears" are investors who have a bearish outlook. The ongoing battle between bulls and bears affects share prices, and short-term price swings are driven more by hunches, rumours, and feelings than by logical evaluations of the company's prospects, resources, and management. Investors begin to feel uneasy and anxious as stock prices continue to fluctuate, which leads to concerns about whether or not they should sell their stocks to protect losses or hold onto the shares in the hopes that prices would rise again. Since emotions are primarily what motivates people to act, it is crucial to carefully consider all available options before making a final choice.

Study the Stock Market 

A novice to the stock market is encouraged to learn the fundamentals of the market, including the many securities that make up the market, before making an investment. Order types, financial definitions and metrics, different forms of investment accounts, timing of investments, stock selection techniques, etc. are among the areas that require attention. Your ability to evaluate risks and make the best decision will be improved by gaining a deep understanding of the stock market

Diversification of Investments

After conducting all necessary research to categorise and determine the risk attached to their investment, skilled investors are primarily responsible for stock diversification. Before diversifying their investments, novice investors must first obtain some experience in the stock market. One of the most popular ways to manage risks is through diversifying exposure. There may be instances where two of the companies may have performed exceptionally, acquiring a 25% increase in price, the shares of two other companies may have increased by 10% each, and the shares of the fifth company were liquidated to settle a significant lawsuit. This can happen if you buy stocks from five different companies and anticipate that the prices of each investment will increase steadily. Diversification can help you recover your loss through profits from the other companies, making it better for you than it would have been if you had to invest in just one company because the investor loses money when their shares are liquidated.