Close
Have you ever thought of starting to save money? What would be the result if you started investing early instead of waiting for “the right time”? Learning how to invest money at a young age can be transformative and one of the most beneficial decisions in life.
Whether you are a student or aspiring professional, starting your investment journey early can offer a powerful edge for your financial life through compounding, time, and risk-taking. Through this article, let us explore those details.
We will have a detailed discussion on how to build a solid financial foundation, beginning with budgeting and debt management to boosting your credit score and more. We will also explore the investment avenues and investment vehicles you can utilise early. Furthermore, you can get to know the importance of investing early and the account types for students or minors and their rules and regulations.
So, through this article, let us have a detailed understanding of investing early in life.
Even though you are a student or a young individual, you can still explore the wide possibilities of investing and growing financial stability. With time on your side, you have the opportunity to try and explore various strategies that can offer a safe and secure financial life with stability for your future.
However, if you are under 18, you need your guardian’s help to start investing. With platforms like FYERS and Zerodha, you can begin investing, but with certain regulations. We will get into those details in the coming sections.
In this section, let us discuss how to invest at a young age.
Starting your investment journey and focusing on strengthening your financial foundation can be exciting at first. But before you jump into it, it is essential that you have strong knowledge of them.
So, starting with the basics is important. Focus on ways to improve your financial knowledge. With an enhancement in online education and resources, you can improve your financial knowledge through online courses, webinars, financial websites, or books.
However, as a beginner, seeking help from experts and identified platforms like FinQuo Versity would be more beneficial, as they might offer comprehensive knowledge about the basics of financial concepts.
Once you gain insights into the basics, you should focus on building a strong foundation. The key steps to consider are:
Once you have got the basics of financial knowledge and investing, you can explore the various investment vehicles. Experts suggest that by starting to invest at a young age, you would be able to take more calculated risks compared to an individual in their 30s or 40s.
Some investment options include:
Along with choosing the right investment vehicle, you should also decide how to invest in it. As most of you might know, portfolio diversification is important to earn more returns and mitigate potential risks.
Afi Cherian, a popular finance YouTuber, suggests in one of his videos that students or individuals who start their investment at a young age can consider splitting their investments into safe investments like FDs, medium-risk investments like mutual funds or SIPs, and high-risk investments like stocks or forex, at least for the first two years of their investments.
According to him, this strategy would help take advantage of your age and risk tolerance, along with learn investments through your own life experiences. Along with him, other experts also have similar opinions, suggesting young people invest their major share in equities or stocks after understanding the risk elements.
However, before following such strategies, you should study mutual funds, the stock market, crypto, forex, and all other investment vehicles and gain a detailed understanding of their working, potential risks, and market performance.
Note: In India, retail forex trading is permitted only in currency pairs approved by the RBI, and crypto is currently unregulated but taxable at 30% on gains with 1% TDS.
Building wealth and maintaining financial stability is not only about investing once in a while or making lucky stock picks, but it is also about discipline and consistency. Saving or investing a part of your earnings consistently is important to ensure progress and growth.
Here are some tips to maintain discipline:
As we have already discussed, investing early in life can offer a positive edge to your financial journey through the value of time, compounding, and higher risk tolerance. So, it is important that you leverage your time horizon and risk advantage and make maximum benefits out of it.
Below are some key points to consider:
As discussed already, investing is not only about generating an abundance of wealth, but it is also about developing a good financial mindset. As young investors, along with maintaining discipline and consistency in investing, you should also stay away from certain mistakes or traps.
Some of these mistakes include:
Starting to invest early in life has a major role in leading to lifelong financial stability. When a student starts investing, no matter how small the initial investments are, it helps build a savings habit. Moreover, when you invest young, you will gain more time to grow your investments, leading to building a financial foundation, strengthening your credit score, and developing financial habits like budgeting, debt management, and more.
Here are some key features to start investing at a young age:
Therefore, more than increasing numbers or wealth accumulation, early investments help build knowledge and confidence. The first-hand experience, losses, and decisions taken over time will help individuals improve their market research skills, seek advice from experts, and make more informed decisions.
Before you begin your investment journey, it is important that you have a proper understanding of the different account types available in India and the rules that apply based on your age. So, before winding up this article, let us have a quick look at it.
Here are some of the common investment accounts in India:
Normally, these accounts can only be created by people above 18 years of age. However, minors can also begin their investments with a minor demat account managed by their guardians. Below are some key points related to such accounts:
Learning how to invest money at a young age is one of the smartest financial decisions you can make. Starting early allows you to build strong money habits, understand risk and reward, and harness the power of compounding over time.
Even small, consistent investments in options like mutual funds, the stock market, or fixed deposits can grow into significant wealth when combined with discipline and patience.
Remember, it’s not about how much you start with, but how soon you start. Stay focused on your goals, continue improving your financial education and market research, and use every experience to become a smarter investor.
The habits you build today will lay the foundation for a financially independent and secure future. So, take the first step now and begin your journey to wealth by learning how to start investing at a young age.
Uma Nair is a professional content writer with over 3 years of experience and a strong foundation in crafting engaging and informative content across diverse domains. Over the years, she has dealt with various niches, and her growing interest in finance has led her to explore the world of financial writing. As an English Language and Literature postgraduate, her educational background supports her ability to convey complex topics in easy and accessible content. In her free time, she stays updated on industry trends to continually enhance the value of her content.
Reviewed by
Ibnujala is a seasoned financial expert of Indian and Middle Eastern markets with an experience of over 15 years. His deep interest in neuroscience fuels his research in seamlessly blending finance and science. With a bachelor’s degree in law from India and an MBA from the UK, his diverse academic background makes him an expert in financial management and mentorship. In addition to being a seasoned investor and serial entrepreneur, he currently serves as the CEO of Finquo Versity.
Disclaimer: The information provided in this blog is for educational and informational purposes only and should not be considered as financial or investment advice. Stock market investments are subject to market risks, and past performance is not indicative of future results. Readers are encouraged to do their own research and consult with a licensed financial advisor before making any investment decisions. The author and publisher are not liable for any financial losses or damages incurred from following the information provided in this blog.
Uma Nair
