4 Baby Steps on Investing for Millennials – Start Your Investment Journey

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How many of you were truly thought how to invest when in school or college? I was a science student and did my engineering. Not a single hour was spent in my school or college where I was thought how to invest, create a financial plan, take investment decisions or the different investment products there are.

My teachers were more obsessed with me learning Trigonometry and carbon and it’s compounds (which I have not used even once after finishing college). Those may be important, but then again, learning to invest and save money is more important.

This is an essential Life Skill!

Here are a few baby steps on investing for millennials or other young investors just starting up. You can take to get started on your investment journey. I am a millennial (90’s kid to be precise!), and a number of my friends are millennials too. This article was written with a Millennial in mind, but it is great for others too who are new to investing and need a basic guide to get started.

Loose the fear on investing

First and foremost, don’t let the thought of investing dampen your spirits. Watching a business channel on TV may baffle you if you don’t have a business background. “Gurus” keep throwing jargon to sound smart. Don’t let that bother you.

Investing is fun! There is so much of joy in seeing your money grow and that will not happen if you are scared to start.

Concepts such as ETFs, Index Funds, Stocks, SIPs are super-easy to understand. You need to spend just a few hours of reading quality articles to get the hang of these for life!

In a survey conducted mid-2019, over 43% of Millennials claim they have not invested any money. Another survey by Economic Times show that just 24% of millennial investors were females. 

Start with the basics

To get started, first understand the basics and chart out your goals. These are just some important investment concepts such as what is a Mutual Fund, How stocks work, reducing debt etc.

Educate yourself

This is much easier than it sounds. If you can put in 6 hours of dedicated time, you will be easily at par with half the population on the basics of investment. Even if you are starting from Zero!

Here are some basic concepts you can read up on personal finance and financial plan:

Other articles:
Anything else you can think of for new investors?x

Reducing Debt

If you have costly debt which are high interest debt, that the interest rate you pay is higher than any returns you will get from investments, then your first step is to bring this debt down. Typically these are:

  • Credit card debt
  • Student Loan Debt
  • Personal Loans
  • Consumer Durable loans etc

Here are some strategies to reduce your debt

Put together a plan

Once you have understood the basics and are debt free, now you can focus on the putting together a plan to start investing money. But before that, ensure you have an emergency fund set.

Emergency Fund

Set up an emergency fund to ensure you are not stuck without any money when in need. This goes before you can start investing. As a rule of thumb, aim to have about 3 to 6 months worth of expenses in easy to liquidate form. These can be Fixed deposits or Liquid funds that allow you to withdraw are once.

Financial Action Plan

This comes next. Work out how much you can afford to save every month. The higher the better. Those on FIRE (Financial Independence and Retire Early) strive to save about 60% or more of their income. They also look at earning additional income.

How much to save

Calculate your income and expenses and decide how much you can save per month. Stick to this number and work on continuously increasing this year on year. This can be done by increasing your income (promotions, new job, income from side hustle etc) or by decreasing expenses.

Set up a portfolio of investments

Now that you know how much you can save be it Rs.500 or Rs.50,000 per month, set up a diversified portfolio. Based on your age and risk appetite you can select between the following:

  • Fixed deposits
  • Equity (stocks)
  • Mutual Funds
  • Gold or Gold ETF

Select what you are comfortable with from these financial assets. Set a % for the asset classes that you chose. 

All of these are easy to start with.
Anything else you can think of for new investors?x

Eg: Say you are 24, just started earning and want a simple investment strategy. As you are a young investor, your risk appetite may be high. You could look at allocating 75% of your savings into Stocks and 25% into Fixed deposits. The money put in Fixed deposit could be for a short term need such as a new car or home loan down payment. Whereas the equity investment would  be for the longer term.

Keep building up your portfolio

That is all there is to it. Once you have started, don’t stop. Keep adding up money and growing your portfolio. Watch it grow, double, triple and reach an astounding figure. 

The best time to invest is now

Let me say that again.

The best time to invest is NOW!

There is no question on this. So start at once as younger investors get an edge in the long run. 

Earlier, you would have read about the compounding power of money. Young investors who start saving and investing early will have investments with higher growth potential. So don’t let time slip by as you party and make merry.

Stop procrastinating, set aside one Saturday or Sunday a month to work on your finances and chart out your Personal Finances to make your dad proud!

Think of the larger picture

An important thing to keep in mind is that investing is all about the larger picture and the ability to delay gratification.

It all boils down to how good you are at wealth creation with the money you have at the moment. You will need to forego the pleasures it will give you right now in order to have it available in multiples in the future.


In conclusion, take some actions right now to better your financial life start your investment journey. Financial Independence isn’t easy, but it is well worth it!

Here are some resources that I personally use and works for me:

– The best and cheapest stock broker in India: Zerodha

ET Money is a great app to invest in Mutual Funds, NPS and Liquid funds

My aim for this post is to get you to take some actions and bust that myth among millennial and later generations that investing is difficult or scary.
Anything else you can think of for new investors?x
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Abhi is a 29 yr old Indian, on FIRE to retire by 40. He has been investing and learning Finance for the past 12 years. After completing Mechanical engineering, he started working in a multi-national Bank and grew to become an AVP. Currently with an IT MNC as a VP. He lives in Bangalore with his wife and their 1 year old daughter. In his free time, Abhi loves to game on the Xbox, watch movies, read and blog.

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