Money basics for Millennials – Part 1

Who is a Millennial?

Anyone born between 1981 and 1996 is considered a Millennial. In 2020, millennials would be in age bracket of 24 to 39. As you can imagine most of India’s current workforce currently are millennials!

Being a millennial myself, we have lots of hopes and dreams. These could be to go on a foreign holiday, buy a nice car, buy a home or even start your own business. However as I reflect on spending habits of my peers, I see that they spend like there is no tomorrow. This could be the new phone that has been launched or a new laptop etc. I too have fallen to this trap many a time. If you are on this blog, you are possibly looking for ways on how to be more responsible with your hard earned money. Fret not! Will share a couple of my hard earned learnings here. Would recommend to follow these steps in the order we have mentioned.


Emergency fund: Get an emergency fund of up to 6 months of expenses stashed away. Have covered this particular topic in a separate blog post

Life Insurance: Evaluate your life stage from time to time to see who all are dependent on you and what is your annual income. A good rule of thumb is to take 10 times your annual income. Warning: Do not and I repeat do not get insurance policies that club insurance and savings. They are nonsense products that will set you back on your financial journey. I have made this mistake in the past and I wish that I had gotten this particular piece of advice before I took my LIC policy.

Health Insurance: One might think that the insurance cover from your workplace is sufficient. However do consider taking a private health insurance again. Your current workplace may offer insurance, would a future workplace offer it? Would the future workplace insurance have the same coverage for you and your family? What if you are in between jobs and a medical emergency comes up. Think about the current pandemic – job losses due to the coronavirus downturn and the healthcare costs of getting treated from the virus. It is a double whammy!

Budgeting: Get on a budget and stick to it! That simple. I cannot stress the importance of budgeting. The confidence that you get once you control your spending, flows into other aspects of your life. Your relationships, your work and many more!

Goal Based Investing: Once you have covered off these basics, start evaluating what are your goals in life. Retirement, Buying a house, buying a car etc. These tend to be the common ones. Write down your goals, by when you want to achieve them and how much do you need to achieve them. This might seem a bit academic but a well written goal (Follow the SMART approach – Specific, Measurable, Assignable, Realistic, Timebound)


We will deep dive into Goal Based Investing in the next blog post.