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“What next?”

It is probably the most popular question that you get asked by family members when you go home for holidays.

You may have completed your education and have just bagged a well-paying job but your family may always ask: “What next?”

Well, the right answer to this would revolve around investment. Not saving, but investment. That’s because investing can help your money grow faster.

So, if you want your money to work hard for you, here is a step-by-step guide to help you chart your investment journey:

Step 1: Educate yourself

If you are new to the world of investments, don’t worry. It is not a big deal. The best thing about investing is that literally anyone can do it. Did you know that the famous investment guru Warren Buffett bought his first share at the age of 11!

But in order to get started, you may need to educate yourself before investing. There are a lot of different investment avenues such as bonds, stocks, mutual funds, Unit Linked Insurance Plans (ULIPs) and so on. Each of these investment avenues have their own pros and cons. The risks and returns vary. Try to read as much as you can so that you can get a better understanding about these avenues.

Step 2: Find out how much you can invest

Everyone operates on a budget. And whatever remains after the expenditure is labelled as savings. The general formula for most people is:

Income – Expenses = Savings

However, the ideal formula should be:

Income – Savings = Expenses

How much money you save shouldn’t depend on your expenses. Instead, how much you spend each month should depend on your savings. This small change can help you increase your savings. With more savings in your account, you can invest more. This can help you increase your financial returns later on. So, sit down and draw up your list of financial goals. And based on that, you can figure out how much you need to invest each month in order to reach these goals comfortably.

Step 3: Find an investment advisor

When you invest in the stock market, picking the right stock at the right time can be very crucial. That requires a lot of time and expertise. However, most people who invest in stocks, bonds and other avenues have regular jobs. It may not be possible for them to spend a lot of time researching markets on a daily basis. That’s why an investment advisor can be very helpful. An investment advisor can help you identify the right investment choices based on your short term and long term goals.

Step 4: Understand your tolerance for risk

When it comes to investments, there is always a degree of risk. Whether it is a savings bank account or the stock market, you cannot avoid risk. However, the degree of risk varies from one investment option to another. It is commonly said: higher the returns, higher the risk.

It is important for you to know how much risk you are willing to take. This is because each investor has a different risk appetite. For example, if you have a low tolerance for risk, it would be unwise to invest in certain avenues like shares. But remember that if you put your money only in a savings account to play it safe, you can risk losing out on higher returns in the long run.

Step 5: Create an investment portfolio

Finally, you can start investing. Based on your investment goals and your risk levels, you can chart out an investment plan with your advisor. You can put your money in options like bonds, Public Provident Fund (PPF), National Saving Certificates (NSC), mutual funds, gold or shares. The important thing is to ensure that your portfolio is well-balanced. For example, you may want to invest in equities. But don’t forget to invest a portion of the money in debt options. This is because, if the stock market crashes, your entire investment doesn’t go down at the same time. The debt investments can give you good support at such times.


Investing is not a destination. It is a lifelong journey. Follow the above steps and you can kick-start your investment journey on the right foot.


Disclaimer: Investment in securities market are subject to market risks, read all the related documents carefully before investing.