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0 to 1 Lakh In 18 Months

For most young men and women starting out on your first job, the common goals most finance guys talk about - retirement, children’s education etc are only a vague thought too far away to worry about. To you, I propose a simpler challenge: Save Up One Lakh Rupees.

For most young men and women starting out on your first job, the common goals most finance guys talk about - retirement, children’s education etc are only a vague thought too far away to worry about.

To you, I propose a simpler challenge: Save Up One Lakh Rupees.

Why one Lakh- besides the fact that it has a nice ring to it?

Because it’s a lot of money and here’re a few things you can do with One Lakh.

#1. It’s your emergency fund – 3-4 months of your salary

#2. The on-road price of a good bike

#3. The price of an awesome pair of diamond earrings

#4. 2 times the cost of a 3 nights holiday in Singapore

#5. An expensive watch for your dad or jewellery for your mom – or both

And, here’s how you get from Zero to One Lakh – in just 18 months:

Year 1: Save Rs. 5000 per month and invest in low risk debt funds or a boring old Recurring Deposit. By the end of the year you would have reached 2/3rd of your goal.

Year 2: Increase your savings by 10% and keep investing in the same Liquid Fund or Recurring Deposit for another six months.

In just eighteen months you would have reached Rs. 1,00,000.

(assumes a return of 8.5% per annum. You might get a slightly lower return and it might take you a month longer – no more.)

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