“Money doesn’t grow on trees!” is a common phrase you would have heard from your parents or grandparents, which is true. But do you know, you can grow your money, not in the sense of a tree but by being financially wise? Financial literacy is equally important to your education. If education provides you with the way to your professional life, financial literacy is going to show you the path to build a secure life. Here are a few suggestions that you can inculcate early on in life.

• Budgeting and Savings – The first step of personal finance is to budget your expenses and saving your earnings. Budgeting is nothing but planning on how to spend the money you will earn, this will teach you the important lesson to spend less than what you earn. It lets you plan ahead of time and stick to it which in turn will allow you to enjoy your earnings and save for a better future. When you have to save in your bank account it gives you the freedom of choice – to pursue your dream job, passion, buying a house or a holiday. It is easy to spend money, but earning it can be a hard task, so think before spending your hard-earned money.
• Banking and Bank Accounts – Opening a bank account will provide you avenues to saving and investing, some of them are Fixed Deposits, Recurring Deposits, PPF, Mutual Funds, etc. You can open a bank account at any time and start saving through it from a young age. When you start saving early, you have that much more time to learn and grow your money.
• Credit cards and debt – Credit cards, if used judiciously, can be a great tool but it has its woes. “Never spend your money before you have earned it” by Thomas Jefferson, is an important lesson that you have to remember and follow. A credit card, if not used rightly, can lead to a mountain of debt and land you in financial soup. Banks charge high interest on credit card loans and unpaid bills, which will only keep growing and spiral out of control into a vicious circle of loan and debt. Some loans are unavoidable like housing loan, vehicle loan, student loan, etc; you can plan for these ahead and have a system in place to repay them. But unnecessary loans on credit card and personal loan are best avoided; don’t try to stretch beyond your limits.
• Magic of Compounding – Compound interest is an important aspect of saving because you can see your money grow without even touching it. Start early and see how adding interest to the principal year on year will allow it to grow to a substantial saving. This allows you to choose the life that you otherwise may not have had. Give money time and it will grow.
• Financial Goals – One of the important lessons after budgeting and saving is setting financial goals. Having financial goals will give you a sense of direction and a vision about what you want to achieve. Keep revisiting your goals at regular intervals as they are dynamic and will keep changing with different stages of life.
• Investments – Saving is important but without investing that saving, you cannot grow your money to meet any future financial goals. When should you start investing? There is no right time for that and it is never too early to start, you can begin investing with the help of your parent and do it independently as time goes. There are numerous financial instruments in the market and you can start with something safe without any risk after careful consideration. Invest only to the extent you are ready to lose in case of an adverse effect.

Insurance – Insurance provides you financial security in the event of an untoward incident. There are different types of insurance available like Life Insurance, Motor Insurance, Property Insurance, Travel Insurance, etc. Each protects different aspect, Life insurance is for your life or the one you insure or Motor Insurance is for your vehicle, in case there is any damage. When you buy Life Insurance at a young age, you get the benefit of starting early with less premium and high insurance coverage.