Over 50% of the Indian population sits at an average age of below 50. Owing to the economic boom in the Asian sub-continent of India millennials are earning high salaries that are likely to further grow in the coming years.

Here are a few financial mantras for our millennials:

Caution yourself against bad financial habits– Millennials tend to have easier access to credit cards and EMI’s compared to previous generations, enabling them to possibly spend more than what they have. Further enabling millennials to fall into the debt trap. Understanding how to manage credit and debt effectively is the need of the hour. Budgeting income and expenses are extremely important.

Low-Risk Investments- Making a loss in your initial phase of investing may do have some serious implications. Remember, “Once burned twice shy”. It is essential for one to start with low-risk investments and gradually move on to aggressive options. This will enable a good experience and build a strong foundation for your future investment journey. A first-time positive experience is more essential than one may think.

Experience VS Assets– Previous generations focused more on asset accumulation compared to millennials. Millennials tend to focus their monies more on experiences rather than asset accumulation such as visiting a foreign country or buying fancy gadgets. It is advisable to maintain a steady balance between the two. As important as it is to achieve one’s short – term goals it is to ensure their long-term goals are been adhered to. The need to invest for one’s long-term goals or requirements cannot be shied away from. Long & Short term goals are like two pans on a “TARAZU”. Stability can be maintained only if equal importance is given to both sides.

Asset Allocation– Millennials are fairly new investors and generally haven’t experienced market cycles. As tempting as it may be to invest in equities one must understand the associated risks. Analyzing one’s risk profile and cash flow requirements are an integral part of an informed investment discussion. Similar to investor’s long and short goals it is important to maintain the balance between equity and debt investments.

Preparing for early retirement– Millennials tend to aspire retiring at an earlier age. An early retirement coupled with an increased life expectancy simply means a much larger retirement fund. One must further understand that there is a significant amount of difference between saving and investing. The first step towards a flexible retirement is to start the process of investing early.