7 Smart Moves to Make Before You Turn 18 💡

TLDR;

This video outlines seven essential steps for individuals who have just turned or are about to turn 18, aimed at achieving financial independence. The key points discussed include the importance of financial education, securing a PAN card, opening a bank and demat account, investing, obtaining a credit card, and filing income tax returns (ITR). Emphasis is placed on early financial actions to build a secure future.

• Importance of financial independence at 18.
• Steps to secure PAN, bank and demat accounts.
• The significance of investments and credit building through a credit card.
• Filing ITR for financial credibility.

Achieving Financial Independence [0:00]

At the age of 18, individuals should start taking steps towards becoming financially independent. Dependency on parents is common before this age, but at 18, one must manage their own finances. It is highlighted that schools do not teach financial literacy or money-making skills, resulting in a lack of knowledge about financial management. The standard advice from parents often revolves around achieving good grades, which may not lead to true independence.

Find an Internship or Job [2:00]

The first actionable step is to seek an internship or part-time job. Websites like Internshala can help find opportunities. Earning any amount, even a small stipend, is encouraged as it initiates the path to earning. Despite parental reservations about focusing on earnings instead of studies, practical experiences can solidify financial independence.

Apply for a PAN Card [3:56]

Securing a Permanent Account Number (PAN) is essential for further financial activities. Individuals can easily apply for a PAN card online, which involves a minimal fee. A PAN is crucial for opening a bank account and is a foundational step towards managing finances independently.

Open a Bank Account [4:44]

After obtaining a PAN card, the next step is to open a bank account. Many banks offer zero balance accounts, which can be opened online. This account will serve as a repository for funds earned through internships, jobs, or freelance work, allowing individuals to manage their finances systematically.

Start Investing [5:19]

Opening a demat account is the next critical step for investing. Investing in shares and mutual funds can help grow wealth over time. The video explains the benefits of early investing, demonstrating how even small amounts contributed regularly can yield significant returns in the long run. Examples are given, showcasing the potential returns from investments in index funds.

Obtain a Credit Card [10:40]

Obtaining a credit card at 18 can help build a credit score, crucial for future loans. The video suggests creating a fixed deposit (FD) to secure a credit card limit. Proper use of a credit card, by paying off bills on time, can positively impact a credit score and provide financial advantages down the line.

File Income Tax Returns (ITR) [12:30]

Filing income tax returns, even if earning minimal income, establishes a financial history which can be beneficial for future loans or visa applications. The importance of filing an ITR annually is emphasised, highlighting it as a practice that can enhance one's financial credibility.

Calculated Risks and Experiences [14:00]

The video concludes by encouraging young adults to take calculated risks in their financial journeys. The host shares personal experiences of various ventures undertaken, emphasising that failure is often a part of the learning process. The message is clear: stepping out of comfort zones and making informed decisions are essential for achieving financial success.