Stage 1: Single and Working

You’ve graduated and just got job and you most probably will start living a frugal life. You will have a low opening bank balance. You might not have financial dependents and with no or limited financial goals, a serious concern at this stage is managing your cash flow.

Start saving

At this stage you might feel you don’t have enough money but even if you save 10 percent of your income, it is enough to start planning for your retirement. (For ex- Saving 2000 per month, at the age of 23; then at a growth rate of 15 percent per annum, it will grow to 36.75 lakh by the time you reach 60.)

Insurance

At this stage you don’t have any financial dependents and you don’t need life insurance but you should definitely opt for a health insurance. It has dual benefits – first - you health will be insured and second - you can claim tax deduction under Section 80C.

Contingency Fund

Start building up a contingency fund so that it helps you out in case of emergencies. Any equity investments done at this stage, held more than 5 years will most likely yield a high rate of return.