Shikha has just landed for the first time Work after his graduation. She plans to work for a few years abroad before going off to college to pursue a management or doctoral degree. Shikha has been advised that going to a good management school with work experience will improve her chances, while allowing her to save up for her higher education. Education. She loves to spend but is also keen to save for her future. Her upper middle class parents lead a comfortable life, but are not fully funded for her education. They have told him that allocating a huge amount for him will compromise his other goals, but they will help him as much as possible. Shikha is tempted to leave the house and take care of herself, as she takes up a job and has an independent Income. However, he does not have such a huge salary that he can live alone and save for his future. She likes her financial independence, but wants to make sure she gets the basics right with her money matters. What should he do?


Shikha’s main goal is to fund her higher education. He must first find out whether his savings will cover the costs. She should assume a conservative rate of return (bank deposit rate) from her investments in which she will deploy her savings. she might look for a bank Loan to balance. He should choose his management school with a good placement record, so that he can repay the loan without any difficulty. Shikha should focus on growing herself Savings, so that his loan amount is reduced to that extent and repayment is not a problem.

Since her parents are ready to meet her regular needs, Shikha should use this to increase her monthly savings. If the regular cost of rent, food, health, transportation and such is borne by her parents while she works, then the savings rate of Shikha will be higher. He should not go out on emotional impulse, as this will increase his expenses and reduce his ability to save. Her parents may be willing to look into this arrangement better than funding a large sum of money for her higher education. They might be more inclined to guarantee his education loan, rather than funding him directly.

Since Shikha knows that she will need an education loan in the future, she should work on building a good relationship with her bank. She must ensure that she builds her deposits and investments are conducted through a bank account, and must keep a clean record. He should avoid credit cards at this time, and should not take personal loans. If she takes out a loan, for example, to buy a bike for herself, she should repay it on time and have a good credit record. Since what is not saved gets spent, Shikha must start a systematic investment plan that debits her account for investments before she has money to spend.

(Content on this page is courtesy of Center for Investment Education and Learning (CIEL). Contributions by Girija Gadre, Aarti Bhargava and Labh Mehta.)