5 years in Industry: Finance advice to new joinees

1. File tax returns every year, yes, even first year. Apart from the fact that it is your duty, it is also

• useful for visa
• useful for house loans

2. Don't get fooled by unit linked insurance plans that agents try to sell to you along with credit cards.
I repeat, don't buy them. What is unit linked insurance plan? They would probably say it is some thing like fixed deposit/recurring deposit with added benefits of insurance.

3. Follow the 100-age rule for distributing you savings.

If you are 21, then invest 79% of savings in high-risk, high-gain things like shares, mutual funds  and 21 % in Fixed Deposits, Recurring Deposits etc. The idea is to take risk when you have capability to handle losses. Gradually bring down risk as you age.

4. For 80c section of tax savings,
a. Start a PPF account of 15 years. Every year, calculate the difference between the max savings limit(1.5 Lakh currently) and your contribution to EPF. Transfer this amount to PPF account and your work is done.

5. Remember, your savings should come after other expenses; which include health insurance and life insurance. Yes, they are expenses and not investments. Get health insurance for your parents especially, with rising cost of health care, it has become necessary.