What’s in the blog?
Your first salary comes with a hundred possibilities. A little shopping, your first big purchase, helping at home, maybe even your first investment. But with so many things you can do with your money, how do you decide what you should do?
In our first MoneyAnna Roundtable, CFP® Urmila Singh, CFP® Varad Khandekar, CFP® Gaurav Karnik and CFP® Prasad Shetty share what they wish they had known when they received their first salary, from spending wisely and starting early to building a healthier relationship with money.
Table of Contents
There’s something very special about your first salary. Isn’t it?
It may not be the biggest amount you’ll ever earn. But it is probably the first time you get to decide what your money should do. Spend it? Save it? Help at home? Buy something you’ve been waiting for? Start investing? You get to choose.
And while there is no shortage of advice for young earners, we wanted to ask a few finance experts about their experience with their initial earnings. So, we brought together four experts for our first MoneyAnna Roundtable.
Four people. One topic. Four different perspectives.
Let’s hear them out.
1) Given your knowledge and expertise today, what is one thing you wish someone had told you when you received your first salary?
CFP® Urmila Singh
I genuinely wish someone had taught me to compartmentalize my salary from the very first month.
When I got my first salary, I could have started saving and investing earlier. But I felt my salary was too low.
When you go from earning zero to, say, ₹10,000, you can tell yourself that you earn only ₹8,000 and automatically save ₹2,000. That’s much easier than spending the entire ₹10,000 and then trying to convince yourself to save from this “meagre” salary or stipend.
The amount may be small, but the habit matters.
CFP® Varad Khandekar
My experience tells me that getting yourself insured is one of the first things you should think about when you start earning.
This comes from personal experience. I met with an accident soon after getting my first job. That experience made me realise that having a safety net is more important than immediately jumping into savings and investments.
Because when you are not insured, one unexpected event can wipe out months of savings in one go.
CFP® Gaurav Karnik
I wish someone had told me that your first salary may be a small number, but it can still create some big experiences.
The amount you earn is finite. But what you experience with it doesn’t have to be.
CFP® Prasad Shetty
A ₹5,000 SIP with a 10% annual step-up, started early and continued for a long time, can potentially create a very meaningful corpus.
My first salary was ₹30,000.
Looking back, I wish I had understood the power of starting early. I could have easily started with a ₹5,000 SIP with a 10% annual step-up and built my financial freedom.
2) We expect young earners to be responsible with their money from day one. But what is one money decision you think they should not rush into — and why?
CFP® Urmila Singh
I feel that even before making a money decision, young earners need to understand their lifestyle decisions.
Especially today, it is very easy to look around and compare. If all your friends are buying an iPhone, you don’t necessarily need one too. If everyone is going on a particular trip, you don’t have to go just because everyone else is going.
First understand what you actually want and what genuinely makes you happy.
When you stop letting other people influence your desires, you automatically become more responsible with your money.
CFP® Varad Khandekar
The decision I see young earners rushing into most often is deciding what their money should look like.
They have an image in their mind of what being an earning individual looks like. So, once they start earning, they feel the need to upgrade their phone, buy a bike or scooter, or make other lifestyle purchases.
I would suggest holding off on these decisions, at least for the first year. You don’t need to look like an earner. Give yourself some time to understand your income, expenses and priorities before taking on new liabilities.
CFP® Gaurav Karnik
Money is meant to be spent. You can spend it today, or save and invest it so that you can spend it on something important tomorrow.
But when you borrow money for things you want today, you are also giving away some of your freedom tomorrow.
An EMI may look like a small commitment today, but it can stay with you for years. And those commitments can affect the choices you make later — where you work, where you live, what risks you can take and even what you can say no to.
Don’t give away your future choices just to have something today.
CFP® Prasad Shetty
Most of us grow up with a list of things we want to do when we start earning.
“I’ll buy this.”
“I’ll go there.”
“I’ll finally get this.”
Sometimes those desires come from things we couldn’t have while growing up. So when we start earning, we may feel like we have to make up for everything we missed.
Before making that purchase, pause and ask yourself:
“Do I genuinely want this today, or am I still trying to fulfil something I felt deprived of earlier?”
And ask yourself one more question:
“Am I doing this for myself, or to prove something to someone else?”
Sometimes, awareness is all you need to make a better decision.
3) How can young earners enjoy their first salary without allowing their lifestyle to grow faster than their income?
CFP® Urmila Singh
If you love something and want to buy it, buy it with your own money. When you’re just starting out, don’t immediately turn to EMIs or credit cards.
Remember, when you buy something on credit, you’re essentially borrowing from your future income. Learn delayed gratification early. It can take you a long way.
CFP® Varad Khandekar
Being responsible with money doesn’t mean you have to save every penny. Young earners should keep some money aside for things they want, not just things they need.
Have a budget. Give yourself permission to enjoy your hard-earned money.
When you have a plan for your spending, you can enjoy your salary without constantly feeling guilty about spending.
CFP® Gaurav Karnik
I think this is one of the biggest life skills you need to learn early: How do I balance what I want today with what I may want tomorrow?
There is no single formula because everyone’s life is different. And comparison makes this even harder, especially with social media.
If your friend is travelling at 22 while you are building your career or business, that’s okay.
You can travel at 40. You don’t have to live someone else’s timeline.
CFP® Prasad Shetty
For young earners, I would suggest a 35% : 25% : 20% : 20% framework for the initial five to seven years.
35% — Basic expenses
Including household expenses and travel
25% — Lifestyle, travel and small dreams
20% — Learning, growth and health
20% — Long-term investments and contingency fund
This isn’t a rigid rule. Your actual numbers will depend on your income, responsibilities and goals.
The idea is simple: make space for today without forgetting tomorrow.
4) What is one thing a young earner should understand before making their first investment?
CFP® Urmila Singh
WHY.
Most people start with: What should I invest in? How much should I invest?
These are important questions. But before that, you should ask: Why am I investing?
What is the goal?
Knowing your “why” helps you choose the right investment and also gives you a better idea of how much you may need to invest.
CFP® Varad Khandekar
Understand the purpose of your investment.
In the beginning, it can feel harmless to start investing based on random advice. At least you’re building the habit, right?
But if you start investing without understanding why you’re doing it or where your money is going, that habit can eventually become harmful. Don’t invest just because everyone around you is investing. Understand first.
CFP® Gaurav Karnik
Understanding your why is more important than choosing what to invest in.
Don’t treat investing like something you set up and then forget about.
The earlier you build a relationship with your money and understand why you’re investing, the more you can learn about yourself along the way.
And then investing becomes more than just watching whether the market is up or down.
CFP® Prasad Shetty
Before you make your first investment, understand what short term, medium term and long term actually mean for you.
Ask yourself:
When will I need this money?
The answer should have a role in deciding where you invest it.
5) What is one financial conversation you think young earners should have with their parents or family early in their working life?
CFP® Urmila Singh
Talk about money at home. Young earners should initiate the conversation even if their parents don’t. Ask your parents about their investment experiences. What worked for them? What didn’t? What mistakes did they make? What did they learn?
You don’t have to follow all their decisions. But you can learn a lot from their experiences.
CFP® Varad Khandekar
I genuinely feel there should be a conversation about how the family manages money. What does the household’s income and expense pattern look like?
Which expenses will the young earner contribute towards?
What investments have already been made? What investments are they planning to make?
There should be as much clarity as possible around money and responsibilities within the family.
CFP® Gaurav Karnik
Instead of simply asking your parents for advice, ask them about their financial regrets.
What do they wish they had done differently?
What money decision do they wish they had made earlier?
You don’t have to repeat their choices. But you can learn from the life they’ve already lived.
And sometimes, having an open conversation about money with people you trust is more valuable than any advice you can find online.
CFP® Prasad Shetty
Two things:
Budgeting and clarity.
Budgeting helps you understand where your money is going and makes you more aware of your cash flow. But clarity about expectations is equally important.
What do your parents expect from you?
What do you expect for yourself?
What financial responsibilities will you take on?
When these things aren’t discussed clearly, misunderstandings can create emotional stress — and emotional decisions often lead to poor financial decisions.
6) Is there anything else you would like to add about this stage of life?
CFP® Urmila Singh
It’s good to hear everyone’s experiences about investing, but I would suggest that young earners consider getting professional help to understand and plan their finances from the beginning.
DIY in finance can sometimes be a costly mistake.
CFP® Varad Khandekar
Invest in yourself.
It’s okay if you don’t start your financial investments immediately. Invest in something that improves your skills and increases your earning ability.
At this stage of life, that can be one of the most valuable investments you make.
CFP® Gaurav Karnik
This is a stage of life when you have the freedom to explore. So don’t simply copy someone else’s idea of what good money management looks like. Build your own understanding of money.
You will make mistakes. That’s okay. In fact, make some mistakes while you’re young — because you have time to learn, earn and try again.
The goal isn’t to get every money decision right. It’s to understand yourself and your money better with every decision.
CFP® Prasad Shetty
Focus on learning and growing, whether it is with money or your career. The more you learn early, the more choices you create for yourself later.
Our four experts may have different answers, but there is one thing they seem to agree on:
Your first salary is not just money. It’s the beginning of your relationship with money.
And like any relationship, the habits you build early can stay with you for a very long time. So, your first salary is a great time to start asking yourself some important questions:
What matters to me?
What do I want my money to do?
What should I protect?
What should I save for?
What am I spending because I genuinely want it and what am I spending because everyone else is?
We have designed MoneyAnna Roundtable to bring different perspectives of experts on one topic. Because when it comes to money, sometimes there isn’t one right answer, there are different perspectives you need to hear to form your own opinion.
This time we had this discussion on ‘your first salary’. If you want our experts to give their perspective on any other topic please feel free to ask your questions.
