I recently exited my business and received 95 lakh from my share in the company. I'm 53, divorced and don't plan to start anything new for a while. I want to give 10 lakhs to my wife to secure my daughter's wedding. I want to use the remaining amount to support my lifestyle and plan retirement. Should I park it in mutual funds, REITs, or start a systematic withdrawal plan after a few years?

Ans: You’ve made a thoughtful move by exiting your business with Rs. 95 lakh in hand.
At age 53, your priorities are very clear – retirement planning and family security.
You’ve already decided to set aside Rs. 10 lakh for your wife to manage your daughter’s wedding.
That leaves you with Rs. 85 lakh for your own financial planning.
You’re not restarting work anytime soon, so your plan needs to be steady and reliable.

Let’s build a 360-degree financial plan around your situation, goals, and future needs.

Current Financial Snapshot
Age: 53

Marital status: Divorced

Business exit proceeds: Rs. 95 lakh

Amount to give wife: Rs. 10 lakh

Balance for self: Rs. 85 lakh

No current income stream

No new work plans for now

Lifestyle expenses not mentioned (assume Rs. 35,000 to Rs. 50,000 monthly)

Objective: Lifestyle support + retirement income

Retirement timeline: Starting immediately or very soon

Step 1: Set Aside Emergency Reserves
The first and most important step is safety.
Emergency funds protect you from unplanned events.
It avoids early withdrawals from long-term assets.

Suggested action:

Set aside Rs. 3–6 lakh as emergency buffer

Use liquid mutual funds or short-term FDs

Should cover 6–12 months of expenses

Do not touch this for investment or goals

This fund gives confidence to plan the rest with clarity.

Step 2: Allocate Rs. 10 Lakh for Daughter’s Wedding
You’ve already earmarked this amount for your daughter’s wedding.
Keep this amount separate from your retirement pool.

Suggested action:

Hand over amount directly to wife or park it safely till needed

Use short-term debt mutual fund or 1-year FD

Do not invest in equity or REITs for this purpose

Capital should be safe and liquid

Weddings need certainty. Avoid market-linked risk for this goal.

Step 3: Insurance Protection Is Must-Have
You haven’t mentioned anything about term or health insurance.
This is important even at this age.

Health Insurance:

Take individual health cover of Rs. 10–15 lakh

Add super top-up if needed

Health costs rise fast after 50

Buy while you are healthy

Term Life Insurance:

May not be needed unless you have dependent daughter

If required, take a small cover for few years

Only buy pure term plan, nothing else

Insurance is not for returns. It is for risk transfer.

Step 4: Park Rs. 85 Lakh Using Phased Strategy
You should not invest Rs. 85 lakh all at once.
A staggered approach reduces market timing risk.

Phase 1 – Park Entire Corpus Temporarily:

Use liquid or ultra-short-term mutual funds

This gives safety and liquidity

Keeps money ready for phased deployment

Also earns modest returns till deployed

Phase 2 – Start STP (Systematic Transfer Plan):

Transfer Rs. 2.5 to 3 lakh monthly to mutual funds

Continue for 30–36 months

Use mix of equity and hybrid mutual funds

This helps average out market volatility over time.

Step 5: Create Strategic Asset Allocation
Now let us focus on where to invest the money.
Your retirement is near or already started.
So safety, income, and moderate growth are needed.

Suggested Allocation (from Rs. 85 lakh):

50% Equity Mutual Funds

For long-term growth

Focus on large cap, flexi cap, balanced advantage funds

Avoid small and mid-cap heavy exposure

30% Hybrid Mutual Funds

Balanced mix of debt and equity

Smooth returns and reduced volatility

20% Debt Mutual Funds

Steady and safe

Use short and medium duration funds

This portfolio supports your retirement with low risk and decent returns.

Step 6: Avoid Index Funds and Direct Plans
Index funds are not right for retirement planning.
They follow market blindly. No manager adjusts during downturn.

Disadvantages of Index Funds:

No active downside protection

No fund manager expertise

Blindly follows index, even when markets crash

Retirement needs stability, not passive exposure

Why Actively Managed Funds Are Better:

Skilled fund managers protect capital

Dynamic allocation adjusts to market

Better suited for low-risk long-term goals

More stable performance over years

Also, avoid direct mutual fund plans.
Direct plans may look cheap but lack guidance.

Disadvantages of Direct Funds:

No personalised advice

No portfolio monitoring or rebalancing

No help during market corrections

Can miss key tax planning steps

Regular Plans via Certified Financial Planner Give:

Professional guidance

Portfolio aligned to retirement

Periodic review and strategy updates

Help during market stress

Clear tax, goal, and risk alignment

Retirement planning must not be trial and error.
A Certified Financial Planner will ensure discipline and structure.

Step 7: Plan Systematic Withdrawal Plan (SWP) for Retirement Income
You don’t need monthly income now, but you might soon.
So plan for Systematic Withdrawal Plan after 3 years.

Suggested Approach:

Start SWP after full equity deployment is done

Withdraw fixed amount monthly from hybrid and debt funds

Use equity funds for long-term growth

Review SWP amount every year

Start small. Increase withdrawal only when needed.
Keep 2 years of income in debt at all times.

Benefits of SWP:

Tax efficient way to receive income

Keeps corpus invested for longer

More flexibility than annuities

Regular cash flow without touching full investment

Avoid taking money as lump sum. Let it grow and support you.

Step 8: REITs Not Ideal for You Right Now
REITs are linked to commercial property income.
They pay rent-based returns from large buildings.

But they have high risk during economic slowdowns.
Returns can fluctuate with occupancy rates.

Disadvantages for Retirement Investor:

Volatile income

No guaranteed rent

Capital value may fall

Not suitable for monthly income

Can’t adjust to changing lifestyle needs

For your stage, REITs are not aligned.
Better to use hybrid and debt mutual funds.
They offer more predictable and smoother income flow.

Step 9: Taxation and Withdrawals Must Be Planned Carefully
New tax rules apply on mutual funds.

Equity Funds:

Long-Term Capital Gains above Rs. 1.25 lakh taxed at 12.5%

Short-Term Gains taxed at 20%

Debt Funds:

Gains taxed as per income tax slab

What You Should Do:

Use growth option in funds

Plan SWP from long-term units to reduce tax

Keep equity investment for more than 3 years

Use tax harvesting method with guidance of CFP

Avoid dividend option – they are fully taxable

Step 10: Review and Adjust Regularly
Your retirement plan is not one-time setup.
It needs regular review and adjustment.

Things to Review Every Year:

Expense pattern

Income from SWP

Fund performance

Asset allocation

Emergency needs

Make changes only with help of Certified Financial Planner.
This avoids panic decisions and ensures long-term stability.

Other Key Suggestions
Keep nomination updated in all investments

Make a will to ensure smooth wealth transfer

Don’t lend or gift big amounts without proper thought

Don’t fall for unregulated or high-return schemes

Stay patient and disciplined for at least 10–15 years

Don’t try to “time” the market. Let your plan work gradually

Finally
You are at a crucial life stage.
You have financial strength with Rs. 85 lakh in hand.
Your needs are long-term, lifestyle-based, and depend on this wealth.

The best path for you is to:

Build a low-risk, diversified mutual fund portfolio

Avoid REITs and market-dependent high-risk options

Avoid direct funds and index funds

Work with a Certified Financial Planner to design SWP

Keep your daughter’s wedding amount parked safely

Review your plan once a year

This structure will give you long-term income, peace, and freedom.
You can live confidently, knowing your money is working safely.

Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment