I am 40 years male. I am investing in MF since 2018. My current income is 3.75 Iakhs per nonth. I have accumulated a sum of 60 lakhs in MF, 20 lakhs gold, 12 lakhs NPS, 5 Lakhs PPF, 22 lakhs PF, 1 crore home, 73 lakhs in home loan. I had invested 85 lakhs (or was swing trading in nifty 50 stocks, now running -12 Lakhs loss as I hold them) I have a 5 yr old son. I put Rs 75k per month in mutual funds. 70k per month home loan EMI. My current expense is 40k a month.
I want to rerire at 50. I want to build a corpus of 20 crores at that time.
Is it suffcient figure for retirement taking into account of inflation and kids study and marriage?
Should i sell my stocks by booking losses and prepay the home loan/put lumpsum to Mutual finds?
Ans: You are already doing many things right. Your disciplined investing habits since 2018, monthly SIP of Rs. 75,000, and controlled expenses of Rs. 40,000 show strong financial awareness.
Let’s go step by step and assess your situation in detail from a 360-degree perspective.
Your Current Financial Position: A Quick Snapshot
You are 40 years old with 10 years to retire.
You want to retire at 50 with Rs. 20 crore corpus.
Monthly income is Rs. 3.75 lakhs with Rs. 75k SIP and Rs. 70k EMI.
Monthly expenses are Rs. 40k, which is well controlled.
You have Rs. 60 lakhs in mutual funds.
You have Rs. 20 lakhs in gold.
You have Rs. 12 lakhs in NPS, Rs. 5 lakhs in PPF, and Rs. 22 lakhs in PF.
You own a home worth Rs. 1 crore, with Rs. 73 lakhs outstanding loan.
You have Rs. 85 lakhs in stocks (mostly Nifty 50) and a Rs. 12 lakh unrealised loss.
You have a 5-year-old son and must plan for his education and marriage.
You are in a good position, but certain actions are needed for wealth creation, debt control, and long-term peace.
Goal Clarity: Rs. 20 Crore Corpus – Is It Enough?
Rs. 20 crore at age 50 is a good target for your profile.
Considering 30-35 years post-retirement, this figure is practical.
It should cover your basic expenses, inflation, lifestyle, son’s education and marriage.
However, regular review is needed to stay on track.
You also need to avoid emotional decisions while investing or booking losses.
Problem Area: Stock Trading and Losses
You hold Rs. 85 lakhs in stocks with Rs. 12 lakh loss.
Most likely, these are not diversified and not goal-linked.
Swing trading in Nifty 50 stocks is risky if not backed by research.
Stocks are not bad, but trading without rules can erode capital.
Since this money is not giving stable returns, it needs action.
We need to convert this stagnant capital into productive use.
Home Loan vs Investment: What’s the Right Move?
Your home loan EMI is Rs. 70,000 per month.
Balance loan is Rs. 73 lakhs.
Interest is likely near 8.5% or more.
This is a high-cost liability, and needs smart planning.
Should you prepay home loan or invest that Rs. 85 lakh?
Let us compare:
Option 1 – Prepay Home Loan
Reduces EMI burden and mental stress.
Guaranteed savings on interest outgo.
Saves tax only up to Rs. 2 lakh on interest under Sec 24(b).
Home loan gives no returns; only helps reduce outflow.
Illiquid once paid. Cannot be reversed if money is needed.
Best for emotional peace, not wealth creation.
Option 2 – Invest the Amount
You can move stock funds to equity mutual funds.
Choose diversified actively managed funds via MFD with CFP support.
Over 10 years, good equity funds can deliver much more.
Capital can remain liquid and flexible.
SIP of Rs. 75k already exists, so lump sum will speed up growth.
Equity has short-term volatility, but long-term reward potential.
Our Assessment: Combine Both Approaches
Use part of the Rs. 85 lakh to prepay 30-35 lakhs of home loan.
This brings down EMI or tenure. Brings emotional peace.
Use remaining 50-55 lakhs for lump sum into mutual funds.
Choose Balanced Advantage, Flexi Cap, and Multi-cap Funds.
Spread the investment over 6-9 months through STP or staggered lumpsum.
This balances risk, growth, liquidity, and debt control.
Mutual Fund Strategy for Corpus Creation
Continue your Rs. 75k SIP every month without fail.
Add a monthly STP from a liquid fund to equity funds from stocks.
Use Regular Plan with help of Certified Financial Planner for selection.
Avoid direct funds. They miss expert guidance and regular monitoring.
Avoid index funds. They don’t protect during market fall.
Actively managed funds give better results with professional support.
Stay invested for 10 years with no withdrawals.
Review funds every year and switch only if necessary.
Diversify across large, mid, flexi, and balanced categories.
Keep goal-based investing – Retirement, Education, Marriage, etc.
Emergency and Insurance Needs
Keep 6 months of expense (Rs. 2.4 lakhs) in liquid mutual funds.
Gold can be kept for future wedding needs. Don’t sell now.
Ensure you have Rs. 25-50 lakhs family floater health insurance.
Term insurance of Rs. 1 crore minimum is essential.
Don't mix insurance with investment like ULIP or endowment.
If you have LIC or ULIPs, surrender and reinvest in mutual funds.
PPF and PF are fine but don’t over-allocate here.
Avoid investing in annuities for retirement. Returns are low.
Retirement at 50: Key Things to Do Now
You have 10 years. Time is your biggest friend.
Build a total retirement corpus of Rs. 20 crore.
Your SIP of Rs. 75k must continue. Increase it yearly by 10%.
One-time stock fund to mutual fund shift will boost growth.
Eliminate home loan early to reduce burden.
Invest only with goals in mind. Don’t chase trends or tips.
Use SWP after 50 to get monthly income without touching capital.
Ensure your portfolio is reviewed by a CFP every year.
Keep a separate bucket for child’s higher education by 18.
Children’s Future Needs: Education and Marriage
You have a 5-year-old son.
His UG education will begin in 13 years.
Marriage may happen after 20-25 years.
Both are long-term goals. So equity mutual funds are best suited.
Start a SIP of Rs. 10,000 separately for his education now.
Use balanced or multi-cap funds for this goal.
For marriage, start another Rs. 5,000 SIP.
Track both goals every 2 years and increase SIP as income grows.
Behavioural Discipline Is Very Important
Avoid frequent fund switching or panic selling.
Don’t see your fund values every day.
Trust your Certified Financial Planner to guide you.
Avoid DIY investing unless you're a trained investor.
Stay focused on long-term wealth and financial independence.
Emotional discipline gives more returns than any market trend.
Final Insights
You are already on the right path with your savings habits.
Use your stock holdings smartly to reduce debt and grow wealth.
Mix lump sum and SIP to grow faster.
Stay fully invested till 50 for compounding benefit.
Keep each investment tied to a goal.
Get yearly check-ups for your portfolio with a CFP.
Don't let emotions or market noise disturb your goals.
Rs. 20 crore is achievable if you act today with clear direction.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment