Prajakta Garg, 25, a Darjeeling-based risk analyst, six months into her first job, follows a mindful, no-frills money habit rooted in early discipline. A simple, flexible budget guides her spending, with clear priorities for essentials, savings and personal expenses.
“I do try to save and invest a small amount whenever possible, mostly in safer options like SIPs (systematic investment plans) in mutual funds or recurring deposits,” says Garg.
Delhi-based Mohd Tajuddin, a graphic designer, 28, is also in his first job. He focuses on thoughtful financial planning rather than aggressive spending. He tracks expenses, prioritises essentials, and follows a flexible monthly budget that’s easy to maintain.
The must do’s first
“Before you eye that latest iPhone or a fancy dinner, look at your non-negotiables. This is the household expenses, rent, that education loan EMI (equated monthly instalment) and basic bills and insurance premiums,” said Sujith S.S., founder, MoneyDhan.com, a Securities and Exchange Board of India (Sebi)-registered investment advisor (RIA).
“Aim to set aside a small ‘buffer’ of at least 5% to 10% for a liquid emergency fund before allocating any remaining funds to discretionary daily expenses as that would help in avoiding taking high interest loan in case of an emergency,” said Abhishek Kumar, a Sebi-registered investment advisor, and founder and chief investment advisor of SahajMoney, a financial planning firm.
“I’d say start saving early, even if it’s a small amount, and don’t fall into the trap of spending more just because you’re earning. Having a basic plan and an emergency buffer really helps,” said Garg.
For first-time earners, the first salary should establish financial order before lifestyle upgrades. “Fixed commitments—education loan EMIs, rent, utilities, and essentials—should ideally remain within 50–55% of net income. Saving 10–20% from day one, even in small amounts, builds discipline and resilience,” said Neha Chhabra, assistant vice president, at Avisa Wealth Creators.
“Once high-interest debt is controlled, they should automate savings into low-cost index fund as early as possible,” said Kumar. SIPs into large-cap equity funds are also a good start. High-interest debt refers to borrowings like credit cards or personal loans that can charge 18-40% annually, which quickly compound and erode savings.
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Tajuddin plans his expenses in advance and separates fixed costs from variable ones. Whatever he saves after essentials, he invests gradually. “As a beginner, I’ve chosen relatively simple and long-term options and plan to learn more and diversify as I gain experience and confidence,” he said.
The silent budget killers
It’s rarely the big spends that break us. It’s the small expense that adds up. Apps you don’t open and gym memberships you don’t use can be a big expense. Then there is ordering food every night because you’re tired or late. All of these habits contribute to a lifestyle that you can’t really afford, especially when you think about the long-term impact. These small leaks sink the ship faster than you’d think.
Impulse UPI payments and buy-now-pay-later options quietly drain surplus. Ignoring insurance or failing to track expenses further weakens cash flow.
Live lean, kill debt faster
A simplified lifestyle can be a powerful tool for faster debt repayment. By consciously keeping expenses lean—limiting discretionary spending, delaying lifestyle upgrades, and focusing on essentials—you free up cash that can be channelled towards reducing outstanding loans.
This discipline matters even more when dealing with large education loans, where interest accumulates steadily over time. As mentioned earlier, always pay off high-interest-rate loans first.
Insurance: don’t wait for later
While employer-ordered medical coverage is an ideal first step toward obtaining medical insurance, most employer-stipulated medical plans are structured as group benefits and do not provide individualised protection.
“Most employer-provided group policies come with a predetermined sum insured and limited flexibility for certain treatments. They often include room rent caps, sub-limits, and exclusions for specific procedures. More importantly, this coverage typically ends when an employee changes jobs, retires, or is laid off, unless the individual opts to continue the policy at their own cost,” said Arun Ramamurthy, co-founder, Staywell.Health.
Young professionals also tend to underestimate their risk of needing emergency medical care, as they often feel healthy.
Thus, personal health insurance becomes mandatory. Young professionals should prioritise essential cover over excess premiums. “A ₹5–10 lakh health insurance policy is critical, even with employer cover, to ensure continuity,” said Chhabra.
“Yes, I’ve taken basic health insurance. I see it as an important safety net, especially early in my career, so that unexpected medical expenses don’t disrupt my finances,” said Tajuddin.
And if your parents or siblings depend on your income, then term insurance equal to 10-15 times your annual income is a must. It’s not an investment, it’s peace of mind for your family. A young person’s term insurance premium is usually even less than ₹2,000 per month.
Guiltfree weekends
“We aren’t saying live like a monk. Lifestyle isn’t the enemy. Lack of boundaries is,” said Sujith.
The trick—set a fixed fun budget for the month. The rule automates your savings the day your salary hits. When your investments are on autopilot, you can enjoy that Saturday night out without that nagging thought: “Can I actually afford this?”
Invest in your career
“There is a trap young professionals often fall into—spending four hours a day tracking stock prices to squeeze out an extra 2% return,” says Sujith.
Let’s look at the math simply. If you have ₹19 lakh in a fixed deposit, it might earn you around ₹1.2 lakh in interest per year (at 6.2%). But do you know what else gives you ₹1.2 lakh a year? A simple ₹10,000 monthly raise.
In your 20s and early 30s, your career has much higher ‘compounding’ potential than the stock market. “So, focus on skills. One certification or a successful project could lead to a 20-30% salary hike. Also, focus on habits: Don’t chase financial complexity. Keep your investing simple (like a basic Index Fund or SIP) and consistent,” said Sujith. The goal is to be a rockstar at your job, not a part-time, stressed-out fund manager.
Your first salary is less about spending and more about setting a rhythm for financial confidence. With early discipline and clear priorities, money becomes a tool, not a source of stress. As income grows, this foundation allows you to handle surprises, build security, and still enjoy life—turning small habits into long-term freedom.
