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One last financial advice blog post for bachelor techies in India

· 4 min read
D Balaji

In a world inundated with financial advice, it's surprising that many young professionals, especially the techies, still find themselves struggling financially. As someone who has risen from financial difficulties, I feel compelled to share my insights in what might be my last blog post on personal finance. This one's dedicated to my fellow bachelor employee countrymen who are navigating the complexities of finances without a strategy. Remember you need money from even before you are born and after you are dead.

TLDR: This article is my last blog article about financial planning for bachelor techies in India.

Understanding the Types:

I've observed that bachelor techies can be broadly classified into two types:

Type 1: No Debt

Type 2: Have Debt

Let us assume your salary is 100 INR in your bank account, how to allocate salary of 100 INR? Now, let's delve into the nitty-gritty of an ideal financial plan based on your type.

Depending on your salary, you may adjust the percentage split but ensure you have plan to send money into each category.

Type 1: No Debt​

For those fortunate enough to have no outstanding commitments, allocating your salary wisely is relatively simple:

First Batch - Investment

  1. 15Rs: Retirement Savings
  2. 15Rs: Stocks/Business
  3. 15Rs: Short-Term Savings

Second Batch - Expenses

  1. 20Rs: Rent/HRA
  2. 20Rs: General Expenses

Third Batch - Others

  1. 5Rs: Discretionary
  2. 5Rs: Parents/Cultural Expenses

Type 2: Have Debt​

If you find yourself burdened with loans, a strategic approach is necessary:

Priority Batch - Debt Servicing

  1. 25Rs: EMI
  2. 10Rs: Principal Repayment

First Batch - Investment

  1. 5Rs: Retirement Savings
  2. 5Rs: Stocks/Business
  3. 10Rs: Short-Term Savings

Second Batch - Expenses

  1. 20Rs: Rent/HRA
  2. 20Rs: General Expenses

Third Batch - Others

  1. 5Rs: Parents/Cultural Expenses

Key Takeaways​

Two critical points emerge from these allocations:

  • Survival Mode: Until your loans are fully serviced, you're essentially in survival mode. This phase might be tough, but it's essential to secure a healthy financial future.

  • Future Planning: Without a strategic approach, you might compromise your financial stability in the long run.

Other Tips​

Apart from allocating your salary smartly, consider these practical tips to bolster your financial health:

  1. Debt Refinancing: Explore options to reduce interest rates on existing loans. If possible, avoid debt leverage to raise wealth or buy consumables.

  2. Lean Lifestyle: Embrace a frugal lifestyle and look for value buys.

  3. Family Support: Seek assistance from family to share the financial burden.

  4. Expense Prevention: Avoid unnecessary expenses that can lead to a chain of additional financial burdens.

  5. Health and Safety: Maintain a healthy lifestyle to prevent unexpected medical expenses.

Conclusion​

Everyone aspires to retire peacefully with financial security. Being in survival mode, you cannot retire even in your old age. In a world where loans and notices clutter newspapers, leading a debt-free life simplifies everything. As bachelor techies, understanding your financial type and making strategic decisions today will pave the way for a secure and stress-free tomorrow.

Newspapers would have less pages if nobody defaulted on their loans. Your life would be simple and stress free without debt.