Making an investment isn’t just about taking some money out of your savings and putting it in an instrument where you are likely to get the highest returns. With every investment you make, there needs to be a clear and defined goal that you want to achieve by spending your money wisely. And more than being prepared for what to do after you start investing, what truly matters, are the things you do before you start investing. From being prepared to facing unforeseen market fluctuations to making sure that you’re not burning a hole in your pocket, here are a few things you should focus on before you make an investment. 

1. Fix A Budget – Creating a budget and sticking to it is one of the golden rules of financial planning. Without a budget in place, you cannot effectively allocate your finances for the right requirements. A thorough account of all your present and expected expenses helps you understand whether you can start investing or if you need to do more in order to invest safely without putting your financial security at risk. By analyzing your income and your expenses you’ll be able to take stock of your financial situation and be better prepared to invest in a smart and planned manner. 
2. Clear Your Debts – It goes without saying that outstanding debt can be a big hindrance when it comes to investing consistently. The faster you clear your debts, the more you get to reap from your investments. Debt can be broadly classified into constructive and unconstructive debt. Constructive debt includes things like home loans with interest rates around 9% and personal loans with interest rates around 13%-18%. Unconstructive debt includes things like car loans and credit card bills. The logic is simple; if you’re getting a 10% ROI from your investment and you end up spending a chunk of that on clearing your debts, you aren’t really gaining much in the long run. So before you start investing, clear all your debts if you can, or create a plan to clear them ASAP.
3. Have A Contingency Plan – An emergency savings fund is imperative for anyone, not just investors. Without a contingency plan to help you access liquid funds in times of need, investing your money is risky business. Markets tend to be volatile, and can swing in either direction. If your financial plan doesn’t account for these fluctuations or fails to protect you from an unforeseen market crash, you could end up putting your financial security at risk when you start investing. The easiest way to do this is to set up a savings account and transfer a nominal amount from your income into it each month. Over time this account will serve as a source of emergency corpus whenever required.
4. Define Your Goals – ‘I want to make more money’ is not an adequate reason to start investing. Before you start investing, ask yourself what you really plan to achieve from your efforts. Remember, making investments takes time, energy, and of course, money. If you don’t make sure that you’re putting the money where it needs to go then you aren’t taking full advantage of the resources at your disposal. Remember, different things in life have different financial requirements; define your goals based on your needs and always keep them in mind while spending your money. 
5. Seek Professional Advice – Financial planning is not child’s play, so if you’re not used to dealing with money in the capacity of an investor, please seek professional help. Instead of calling up friends and well-wishers who invest and asking them for advice, get in touch with a certified financial planner. These individuals are trained to help people with their finances, provide them with support, and guide them through the investment process. Everyone has their own needs and reasons for investing, so while your friend or relative might be doing well with their investments, it’s not an indicator that it would work well for you as well. For this reason, talking to a certified financial advisor or a reputed wealth management firm will do a lot of good for your financial future.