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Tuesday, June 24, 2025

Smart Money Starts with Smart Prep: 6 Things to Do Before You Start Investing

Smart Money Starts with Smart Prep: 6 Things to Do Before You Start Investing

I wasn’t expecting a life lesson at 36,000 feet. I also wasn’t expecting turbulence, a chatty co-passenger, or a cup of coffee that would change how I explain personal finance forever. 

Illustration of a mid-aged personal finance consultant and an elderly man having a conversation on an airplane about investing, with the text "6 Things to Do Before You Start Investing" and website www.mohamedarif.in.

But that’s exactly what happened on an early morning flight from Chennai to Mumbai.

And now, dear reader, I invite you on that flight with me no boarding pass needed. Just curiosity, and maybe a notebook.


☕ Window Seat, Coffee in Hand

Having just wrapped up a financial literacy session the previous day, I was hoping for a peaceful flight. Window seat? Check. Noise-cancelling earphones? Check. Inner peace? Pending.

Just when I was ready to doze off, the gentleman beside me late 60s, Nehru jacket, reading The Hindu turned and asked:

Young man, what do you do for a living?

I smiled. I’m a Personal Finance Consultant. I help people grow their money smartly.

Then came the twist:

Tell me one thing. Do you clean your kitchen before cooking or after?

Before, I said, still unsure where this was going.

He smiled. Exactly. So why do people jump into investments before sorting their financial kitchen?

Boom. That’s when I decided to walk him and now, you through the 6 essential steps to take before investing your first rupee.


🥇 Step 1: Find Your Emotional Why

Why do you think people invest? I asked.

Because Instagram influencers say SIPs make you a crorepati in 15 years, he said with a grin.

Exactly.

Investing without a goal is like ordering an Uber without a destination.

  • 📌 Want to travel the world in 5 years?
  • 🎓 Save for your child’s education?
  • 🕰️ Retire early?

Clear goals give your money direction. Without them, it drifts aimlessly much like my cousin at a wedding buffet.


💸 Step 2: Track Every Rupee Like It’s a Mischievous Child

How much do you spend monthly? I asked.

Around ₹40,000, he said confidently.

Fifteen minutes later, our list hit ₹67,000.

People always underestimate their expenses. Subscriptions, food delivery, impulse buys, UPI donations to random babas it all adds up.

Use apps, spreadsheets, or notebooks. Know where your money sneaks away.


🚨 Step 3: Build Your ‘Turbulence’ Fund

Right on cue, turbulence hit. The seatbelt sign blinked on. Uncle gripped the armrest.

Don’t worry, I said. This is why we need an emergency fund.

  • 👨‍⚕️ Medical crisis
  • 💼 Job loss
  • 👨‍👩‍👧‍👦 Family emergency

Save 3 to 6 months of expenses in a liquid fund or savings account.

This is not investment money. It’s your financial parachute.


💳 Step 4: Kill Your High-Interest Enemies

Got any loans? I asked.

Just a credit card. I pay the minimum due, he replied proudly.

Houston, we have a problem.

Credit cards charge 30–40% annually. Paying them off gives you the highest guaranteed return.

Before investing, destroy your high-interest debt.


🎯 Step 5: Know Your Investor Personality

He said he invested in stocks based on WhatsApp tips. When the stock dropped 40%, he sold and bought gold.

That’s not investing, I said. That’s emotional gambling.

Ask yourself:

  • 📉 Can I handle market dips?
  • 🧠 Am I calm or anxious under stress?
  • 📊 Do I prefer safety or growth?

Know your risk appetite. Investing is not one-size-fits-all  it’s like a custom made kurta. It should fit you.


📘 Step 6: Learn Just Enough Finance to Not Get Fooled

No need to become Warren Buffett. But you must know:

  • What is an SIP?
  • How compounding works
  • Mutual funds vs FDs
  • What is capital gains tax?

If you don’t understand your money, someone else will use it for their gain.


🛬 As We Landed in Mumbai…

The pilot announced landing. Uncle folded his newspaper and said:

Beta, I never thought about these things. I always assumed investing was step one.

I smiled and replied:

Investing is not the first step it’s the reward. First, fix your financial foundation. Then build wealth.


📲 Want to Get Started the Right Way?

If you want to stop guessing with your money, here's what to do:

  • 👉 Book your FREE personal finance consultation: Schedule Now

💬 Leave a comment below if this story made you smile, think, or scream This is so me!

Smart investing doesn’t begin with money. It begins with clarity.



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