Is equity or debt better for beginners?

Beginners should start with a mix of both. Debt provides stability while equity helps long-term growth. A common starting mix is 40% equity and 60% debt.

How should I split equity and debt based on my salary?

Lower salaries should allocate more to debt (70–80%) while higher salaries can invest more in equity (60–80%) because they can handle short-term volatility.

Is equity risky for low-income investors?

Equity can fluctuate in the short term, so low-income investors should begin slowly with small SIPs while maintaining a strong debt and emergency savings base.

Are PPF and SIP enough for a balanced salary-based investment plan?

Yes. PPF provides long-term stability while SIPs offer growth. Together they form a balanced strategy for most salaried individuals.

How do I choose between equity and debt for my portfolio?

Base your choice on salary, risk appetite, job stability, dependents, and goals. You can also use the Salary Investment Calculator to estimate your ideal mix.

Equity vs Debt: Which Should You Choose Based on Your Salary?

A practical guide for Indian salaried individuals to build the right investment mix of equity and debt based on income level and financial goals.

What Is Equity?

Equity investments include stocks, index funds, and equity mutual funds. They offer high long-term returns but can fluctuate in the short term, making them ideal for long-term wealth creation.

Ideal for: High salary earners, long-term goals
Returns: 10–14% per year (historically)
Risk: Market volatility

What Is Debt?

Debt instruments such as PPF, FDs, debt mutual funds, and liquid funds offer stable and predictable returns. They are suitable for low-risk profiles and essential for stability.

Ideal for: Low salary individuals, short-term goals
Returns: 5–8% per year
Risk: Low

How Salary Influences Your Equity–Debt Mix

Salary under ₹30,000

Focus on stability and emergency savings.

Suggested mix: Equity 20–30%, Debt 70–80%

Salary ₹30,000–₹60,000

You can begin meaningful long-term investing.

Suggested mix: Equity 40–60%, Debt 40–60%

Salary ₹60,000–₹1,00,000

Higher stability allows more equity exposure.

Suggested mix: Equity 60–70%, Debt 30–40%

Salary above ₹1,00,000

High income enables more aggressive long-term investing.

Suggested mix: Equity 70–80%, Debt 20–30%

Factors to Consider Before Deciding

Age: Younger = more equity
Job stability: Stable job = more equity
Responsibilities: Loans & dependents = more debt
Risk appetite: Low tolerance = higher debt

Use Tools to Build Your Mix

Use our tools to make data-driven decisions: