Parth Thacker was elated when he received a whooping INR 240,000 stipend for a two month summer internship at Hindustan Unilever Limited (HUL). This is one of the coveted internships for most Mechanical and Chemical engineering junior undergrads in Indian Institute of Technologies. Even before the money was in his bank, he had made plans to buy Duke for his love of motorbikes.
Barring a few code geeks engrossed in data analytics and software development, most of the engineering interns in India aren’t that lucky to get a hefty stipend. However, some companies are quite generous with their payouts and many international internships often pay a good sum, enough to put your brains into work on how to invest or spend your internship money. If you are one of those guys clueless on how to make use of your stipend, then here are 5 ‘Numb Tips’ for you.
Jaseel, a senior undergraduate in Biomedical Engineering was lucky enough to get an internship opportunity at Massachusetts Institute of Technology twice. Having won the Khorana scholarship in his junior undergraduate year in 2016, he was onto something different this time. His passion for travel and photography, made him delve into aerial photography. He brought a DJI Mavik Pro and his aerial shots have featured in several Instagram pages and he was even paid by several startups and filmmakers for his aerial footages. There would have been several guys out there with a stipend much higher than his (He received around $5000 for his 3 months internship), but he has pushed himself enough to turn his hobby into an investment.
You don’t have to follow a similar pathway. You can figure out your own creative vent. If you are an amateur photographer, you can buy a DSLR or a great quality lens and submit high-quality photos to Shutterstock. Mind you this can help you earn a few bucks!!!
Do you know that most banks pay you peanuts (around 3.5% to 4%) as the interest on your savings? Why keep the money in the bank when you can earn more? I would not suggest you to invest in Public Provident Fund (PFF) with a term to keep your asset for a certain period. You can invest in Liquid Mutual Funds. I invested in Reliance Smart Deposit that pays you interest around @6.8% per annum. This is a low-risk investment with instant money withdrawal to your account in less than 30 minutes. This is better than fixed deposit (@7%) in a bank because you don’t have to go to any financial organization or queue up to seek help. You can regulate your money at your fingertip using ET Money app. This app by Times Group can help you invest in top mutual funds by churning out curated aggressive and balanced mutual fund schemes to buy. With a liquid deposit, you can withdraw the money any time you want. Well, you can withdraw 90% of your deposit on the same day. For the rest 10%, you have to place a request for withdrawal through the app and voila! the balance will be reflected in your bank account in the next 2-3 business days.
If you have long-term plans (at least 1 year), consider investing in mutual funds of diversified industries. For example, you can buy 40% in large-cap funds, 30% in multi cap and 30% in small-cap funds. You can also open an account on ‘RobinHood’ and start trading in “safe” stocks like Apple, Google etc. If you are an Indian, you can open your Demat account and start investing in equity shares and index. You can educate yourself about the stock market and then take further strides.
Numb Tip: Financial Education is crucial for financial independence. Someday you have to learn it. So, the earlier the better.
Till 2016, the Indian media was shy of publishing news about bitcoins and Cryptocurrency in the front page. Come June 2017, the headlines often featured the stories about Cryptocurrency. My western adventure had taught me some lessons on financial independence and I decided to invest in cryptos. I invested a few thousand in altcoins through Koinex and I earned over 1000% profit. It was fun until the RBI crackdown. But still investing in a few altcoins can help you get profits. Don’t worry about the RBI ban! There are several other ways to invest in these mercurial assets. I will save this information for another blog post.
If you are an electronics enthusiast with some great ideas in mind, getting your hands dirty in a new project can help you win several innovation challenges. Accenture Innovation Challenge, TI Innovation Challenge, and Ericson Innovation Challenge are held annually with a great exposure and prize money.
Further, you can push yourself a step further by investing in your startup. Have you ever fancied starting your own venture while being in college, but backed out due to lack of skills, money or time? Let me tell you investors don’t always hand you over the money and even the most creative ideas which sound good to ears receive funding and still fail. So, your stipend money can help you hire a few employees, buy your domain name, build your mobile app and there is more to it. In fact, I had always wanted to start my own blog, even before I cleared the Joint Entrance Examination (JEE). However, being a procrastinator, I kept on pushing the plans further. So, finally, during my summer internship in the junior year, I brought a domain with my stipend and started this blog to write my travel story. But as Robert Frost said, “Roads lead onto roads”, you are reading a post unrelated to travel. I save the story for another day.
Investing in a skill with high demand can place you ahead of your contemporaries. You can pay a small amount from your stipend money to earn a certificate in Machine Learning on Coursera, pursue Data Analytics course on edX or pursue any course that can bolster your competence in an industrial skill. Some recruiters do value MOOCs during interviews.
Although getting a summer internship is not a cake walk, getting a paid position is tough. However, spending the stipend wisely is an art and it requires financial knowledge which every student should acrue.
Do let me know in the comments on innovative ways to spend your internship money.