You know you should be investing. You have known it for a while. Maybe someone mentioned a stock. Maybe you watched a YouTube video about SIPs. Maybe you read something about the Sensex hitting an all-time high and felt a quiet anxiety that you were on the outside looking in.
But you haven't started yet.
I understand exactly why. Not because you are lazy or uninformed. Because the moment you go looking for how to begin, the internet buries you in conflicting advice, technical jargon, and products you don't understand from people who may not have your best interests at heart.
So let me give you the version I wish someone had given me.
No jargon. No products to sell. Just the steps, in order.
First — Let's Demolish Three Myths
Myth 1: You need a lot of money to start investing.
You can begin a Systematic Investment Plan in a Nifty 50 Index Fund for Rs 100 per month. That is less than a cup of chai at a café. The amount matters far less than the habit. The habit is the foundation. The amount scales with your income over time.
Myth 2: Investing is too complicated for someone like me.
The most complex thing you will need to do in Step 1 is fill a KYC form online. Everything you need is available on the internet — one question to ChatGPT and you will get a step-by-step guide exactly tailored to your situation. A 22-year-old who just started their first job can set this up in under an hour. The sophistication comes later, if and when you want it. The beginning is simple.
Myth 3: You need to know which stocks to pick.
You don't. Not at the beginning. There is a perfectly valid, genuinely effective approach to building wealth that requires zero stock picking. We will cover it. Your starting point does not require you to read annual reports or understand P/E ratios.
Those skills are valuable. They will come. But they are not the requirement for Step 1.
The 5 Baby Steps
Step 1 — Know Your Number
Before you invest a single rupee, you need to know three numbers:
Your monthly income.
After tax, what actually lands in your account.
Your monthly essential expenses.
Rent, groceries, EMIs, utility bills, transport, school fees if applicable. The non-negotiables. Be honest here. Do not round down.
Your investible surplus.
Income minus essential expenses. This is what you have to work with.
Most people have never actually calculated this. They have a vague sense that "something is left over" at the end of the month. That vague sense does not build wealth. The number does.
Even if your investible surplus is Rs 2,000 per month right now, that is your starting point. The goal is to protect it, not spend it before the month ends.
Action
Open a notes app or a simple spreadsheet. Write down those three numbers. That is Step 1. Done.
Step 2 — Build Your Emergency Fund First
I know you came here to learn about investing. I need you to do something before that.
Build three to six months of essential expenses as a liquid emergency fund.
If your essential monthly expenses are Rs 30,000, your emergency fund target is Rs 90,000 to Rs 1,80,000. This money lives in a savings account or a liquid mutual fund — not in equity. Not in a fixed deposit with a lock-in. It must be accessible within 24–48 hours.
Here is why this step cannot be skipped. If you invest your entire surplus and then face a medical emergency, a job loss, or a family crisis — you will be forced to redeem your investments at whatever price the market offers that day. You will sell your equity in a panic, possibly at a loss, and undo months or years of compounding in one desperate transaction.
The emergency fund is not dead money. It is the foundation that lets you invest with confidence, without fear, and without interruption. It is the difference between staying the course and getting shaken out.
Build it first. Keep building your investments in parallel if you can. But do not invest before this safety net exists.
Step 3 — Open Your Account
You need one account: a Demat Account. This is where your shares and mutual fund units are held in electronic form. Think of it as a bank account, but for investments.
My recommendation: Zerodha. It is India's largest discount broker. The interface is clean. The costs are transparent. Account opening is entirely online. You will need your PAN card, Aadhaar, a cancelled cheque or bank statement, and a selfie. The process takes 15–30 minutes.
Once your account is active — typically 2–3 working days — you are set. For mutual funds specifically, Zerodha's Coin app lets you invest in direct plans of all major funds in one place.
Action
Go to zerodha.com. Start the account opening process today, not this weekend, not next month. Today.
Step 4 — Make Your First Investment
Here is what you buy first: a Nifty 50 Index Fund, Direct Plan, Growth option, via SIP.
Let me explain each word.
Nifty 50 Index Fund
A mutual fund that automatically tracks the 50 largest companies in India. HDFC, Reliance, Infosys, TCS, ICICI Bank — these are among them. When India's economy grows, these companies grow, and this fund grows with them. You are not betting on one company. You are betting on India.
Direct Plan
The version of the fund with no distributor commission. The expense ratio is typically 0.1% for index funds. You keep more of your returns.
Growth option
Instead of paying out dividends, profits are reinvested. This maximises compounding over time.
Via SIP
Systematic Investment Plan. A fixed amount is automatically deducted from your bank account on a fixed date every month and invested in the fund. You set it once. It runs on its own. No decisions required each month.
Amount to start with: whatever is available from your investible surplus. It can be Rs 100. It can be Rs 5,000. Start with what you have. Increase as your income grows.
Action
On Zerodha's Coin app, search for any major Nifty 50 Index Fund — UTI Nifty 50, HDFC Nifty 50, or SBI Nifty 50, all are excellent. Select Direct Plan. Set up a monthly SIP. Choose a date that is 2–3 days after your salary credit date.
Step 5 — Protect It From Yourself
This is the step nobody talks about. And it is, arguably, the most important one.
Once your SIP is running, your biggest threat is not the market. It is you.
The market will fall. Sometimes by 10%. Sometimes by 30%. When it falls, every instinct you have will scream to cancel the SIP, redeem the units, "wait for things to settle down." This instinct has destroyed more wealth than any market crash in history.
Let me tell you what actually happens when the market falls 30% and your SIP continues: you are now buying the same Nifty 50 units at 30% cheaper than before. You are accumulating more units per rupee. When the market recovers — and it always has, in 35 years of Indian market history — those cheap units compound at full value.
The wealth is built in the boring months. In the months when nothing exciting is happening, when the market is flat, when the news is dull. Those SIPs that you ran quietly and forgot about — that is where compounding does its work.
The Rule
Check your portfolio once per quarter. Not once per week. Not every time the market moves. Once per quarter. Read the NAV, confirm the SIP ran, close the app. That is the entire job for the first 12–24 months.
What Comes Next
Once you are six months into your SIP and the habit is solid, you can begin learning more. Not before.
The next layer is understanding individual businesses — how to read a company, what makes one fundamentally stronger than another, how to identify quality management. That knowledge, combined with patience, is what takes you from index investing to direct equity.
But you cannot skip the foundation. Nobody runs before they walk. Nobody builds a skyscraper without the base.
You have five steps. Each one is small. Together they set the foundation for everything that follows.
Start today. Not when you have more clarity. Not when the market "looks better." Not when you have more money. Today. With whatever you have.
I started from zero — no pension, no financial background, no roadmap. 14 years later, equity investing is the most consequential decision I made. If I built this from nothing, so can you.
— Lt Cdr Upendra Prasad (Retd.)
Want the full framework? Download Stay the Course — a free guide to equity investing for the first-time Indian investor — at icanbefitter.com/financially.
Har Har Mahadev. 🔱