Financial Tips for New Drivers: A Blog About the Financial Tips You Should Consider Because You are a New Driver

  • Fixed Deposit
  • 16 Days ago
Financial Tips for New Drivers
HIGHLIGHTS

  • Self-Discipline or Control
  • Start Investing Early
  • Know about Taxation and its Benefits
  • Acquire Financial Literacy
  • Create an Emergency Fund
  • Protect Your Savings
  • Prepare a Budget


People have heard of recurring and fixed deposits, but not many are well versed with them. Personal finance or "financial planning" as it is widely known, is not usually taught in educational institutions in India. Consequently, financial ignorance has many repercussions that people face when they start earning in their lives.

Managing money is not as simple as it seems from the outset and also not as complex as finance theories make it look. One has to patiently practice investment for future saving with discipline to create wealth in the long run. If you don't learn how to manage your finances, there are chances that you will end up mismanaging it through commission-based financial planning.

In this blog, we will cover the basics of investment for beginners. This blog will also offer insights in the form of financial tips to answer your question: How do I start investing?

Tips for New Drivers

New drivers are people who have just started earning and are in the initial stages of their professional journey. So, here are some tips for these beginners in financial planning.

  • Self-Discipline or Control

    There are many savings schemes in India, like the fixed deposit, and many experts say that it is the best saving scheme. Though it is true, young investors have to practice discipline in whatever investment for future saving they are doing.

    You might have to delay or cancel some of your futile expenses to keep your finances in check. It could be as small as buying your favorite jeans when you have many already or as big as buying a car by taking a loan. Save the money for it, and then buy, when you can afford it.

    Look for a decent fixed deposit scheme offered by an NBFC in India like Shriram City Union Finance Limited and deposit your savings in it. They also have a fixed deposit calculator on their website that you can use to know what amount to invest for how many years to achieve your financial goals.

  • Start Investing Early

    People always think that they don't earn enough to start investing. Thus, they miss the crucial years of their life when they have comparatively lesser liabilities. The second lesson in investment for beginners is to start early, even if you start small.

    This approach is crucial because the compounding effect (the eighth wonder of the world, according to Einstein) works only in the long term. Thus, stay invested for many years to see your savings grow gradually to become your wealth.

    A high-interest rate fixed deposit can do the trick if the investment horizon is long. The key is to start early and stay invested.

  • Know about Taxation and its Benefits

    A famous saying in the world of finance goes like this, "There are only two things in life that you cannot avoid: Death and Taxes." So while you cannot avoid tax, you can indeed reduce your tax liabilities.

    Tax planning is also a key component of personal financial planning. Apart from choosing the best fixed deposit plan, you should also look for ways to pay lesser tax. You should take rebates and benefits under different sections of the Income Tax Act.

    Just like a fixed deposit calculator, there are tax calculators available online that you can use.

  • Acquire Financial Literacy

    As they say, the best investment in your 20s is the investment you made in yourself into becoming better than what you were yesterday. You have to be financially literate to compare and decide on the best saving scheme for yourself.

    Learn the difference in buy vs. rent, pros and cons of having a cheaper broadband plan, differentiating between fixed and variable expenses, need of an emergency fund, nuances of a fixed deposit scheme, etc.

    Start reading more about financial planning and money management and watch videos on YouTube and Netflix. This strategy will also enlighten you more and answer your question of How do I start saving?

  • Create an Emergency Fund

    The one thing that the Coronavirus pandemic has taught us is the need to have a corpus for unforeseen emergencies like job loss or medical treatment. An emergency fund kept in the form of a fixed deposit scheme will come to your rescue in these scenarios.

    Even if you have a low salary, take some amount from it to put in your emergency fund. Have a separate account for an emergency fund and allocate a fixed amount every month to make an investment for future savings. When you have an amount equivalent to 3-6 months of your monthly salary, put that amount in a high-interest rate fixed deposit offered by any NBFC like Shriram Transport Finance.

  • Protect Your Savings

    There are risky investment options like equity investing, mutual funds, derivatives and currency trading, etc., that can finish your savings in a week. Thus, these asset classes are not an investment for beginners, considering that you have just started earning.

    It is better to be financially secure by putting your hard-earned money in the best saving scheme than to blow everything away in one trade. Look for asset classes with low risk and decent returns like fixed deposits, government bonds, recurring deposits, etc.

    There are many types of fixed deposit schemes (cumulative, non-cumulative, Flexi, tax-saving, etc.) in the market today. Research about them to know the ideal system for yourself.

  • Prepare a Budget

    In the initial years of earning, youngsters always crib about being oblivious of where their money is going. To make an investment for future saving and better money management, you should create a habit of budgeting everything.

    Plan your expenditure and allocate a certain amount towards your savings and emergency fund at the start of every month. Then monitor your expenses. This way, you can track where your money is going and restrict certain unnecessary expenditures.

    As a lesson in investment for beginners, ensure that your expenses ideally should never exceed your income.

Final Words

We hope now you have a fair idea of handling your finances and some of the dos and don'ts of money management.

At Shriram City Union Finance Limited, we offer a high-interest rate fixed deposit at 7.75% with minimal paperwork and flexible tenure options. We have options of both cumulative and non-cumulative fixed deposit schemes with the facility of premature withdrawal available. There are multiple interest payout options - monthly, quarterly, semi-annually, and annually.

To know more about our fixed deposits, click here. We also have a free fixed deposit calculator that you can access on our website. Allow us to serve you!