Starting your first job? 9 things you need to know about personal finance

Getting a job after completion of education is the dream of every individual. Everyone wants to be self-dependent. What will you do with the salary for your first job? How will you make the most of your salary? What do you need to do to improve your financial knowledge, prepare for financial success while avoiding avoidable financial mistakes, and to ensure that you are on the right path to achieving your goals in the short and long term?Everyone gets very excited after getting their first job but there are some points that need to be kept in mind to manage your personal finance.

1. Budget against your expected take-home pay: Company hires a person on CTC (Cost to Company). A CTC is very different from salary in hand. A person first needs to find out what his salary in hand after all the deductions in CTC.
2. Health Insurance: Most companies offer their employees free or paid group insurance. Since employers are big customers for these health insurance companies, it is easier to settle claims. Also, include your parents if they do not have health insurance coverage. In most cases, the employer's insurance is cheaper and covers everything without too many exclusions/complications. You can decide the package of health insurance based on your salary. The additional benefit is that you save on health insurance contributions for yourself and your parents.
3. Emergency Cash: Since you have started earning money, you no longer want to borrow from your friends or family. So start saving for emergencies. People get sick, wages are late or you have to travel urgently. Begin to deposit every month an amount in a savings account or a fixed deposit, which is easily accessible in an emergency. Depending on your support system and access to the credit card, you should try to have an emergency fund that is equivalent to three to six spending months. Emergency cash saving is what normally individuals ignore during financial planning.
4. Term Life Insurance: The life insurance premium is cheaper at a younger age. It is also easier to buy life insurance because you are generally healthier at a younger age. You also need insurance if you have dependents or a loan in progress. It also helps in tax saving.
5. Start Investing: You can have multiple goals in the short, medium and long term. The short term goals could be to buy your bike/car in the medium term, save for your wedding/pay your student loans and save for your retirement in the long term. These are just examples and you can list your own goals. Check if your employer supports a pension plan. The best is to invest in PPF. PPF is also a long term investment and helps you in your future financial planning.
6. Learn Expenses= Savings - Income: Most people believe that Expenses= Income – Saving, meaning that there is no savings plan. You need to adjust this approach and first make your investments (savings) and manage your spending with what you have left. You would be surprised that in most cases you can handle it. If you're having trouble investing, automate the process - start a ULIP or invest in a regular deposit. The amount will be deducted from an account automatically and you will be surprised that you can continue to manage your expenses without affecting this your standard of living.
7. Plan your Taxes: In the early years, people are reckless about taxes. It would be helpful to start tax planning early. Tax savings should go hand in hand with an overall investment plan. In addition, many companies offer flexible compensation structures. Match your components to save the maximum tax while maintaining a serious home.
8. Invest in Yourself: Your skills and education are a valuable asset. Invest money to keep your skills up to date. Do not hesitate to pay for certifications and skills that can help you in your career. These investments bring you back many times.
9. Maintain a personal balance sheet: A balance sheet is a statement in which you can write down your assets and liabilities. With a personal record, you know what you have and what you need! It's a powerful tool to take your finances to the next level.