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Mihir Tanna |831 Answers |Ask -Follow

Tax Expert - Answered on May 10, 2024

Asked by Anonymous - Apr 27, 2024Hindi

Hi,a company has offered me dealership, which sells property abroad from India. I have to look for clients ready to invest abroad.they will give commission in my account,but if client insist then I have to give some amount to the client. It can be cash or cheque. Are there any taxes invloved in this.Is gst applibale on commission.?

Ans: If you are resident and ordinary resident in India, you have to pay tax on Income earned even outside India i.e. Commission Income.

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Money

Mihir Tanna |831 Answers |Ask -Follow

Tax Expert - Answered on May 10, 2024

Question by Kalasagara - May 08, 2024Hindi

Capital gain tax on sale of ancestral property. 1940 my father has got some ancestral property which purchased on 1930 and the same has been distributed among our family members 2 years back. I got my share 2 years back and now I want to sell the same. At present we don't know the purchase value of the property purchased on 1930. Please advise me how to calculate short term/Long term capital gain tax and how to utilise the capital gain tax to purchase new property or house/flat

Ans: It will be taxable as Long term capital gain. You have to get fair market value as on 1.4.2001 and after applying indexation on said value you can derive at amount of capital gain.

To save tax on long term capital gain; you can invest gain amount to acquire house property and get exemption u/s 54. As per section 54, if you want to buy a residential house property from long term capital gain from sale of house property then you must buy the residential house property 1 year before or 2 years from date of such transfer of shares or construct the house property within 3 years from date of transfer of such property.

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Mihir Tanna |831 Answers |Ask -Follow

Tax Expert - Answered on May 10, 2024

Asked by Anonymous - May 08, 2024Hindi

I am a NRI, my PAN CARD was issued as Non Resident, whereas my ADHAR is issued as Resident. Is there any issue in linking PAN & ADHAR ?

Ans: It is likely that PAN and Aadhar will be linked even in case of mismatch is residential status

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Money

Mihir Tanna |831 Answers |Ask -Follow

Tax Expert - Answered on May 10, 2024

Asked by Anonymous - May 01, 2024Hindi

Sir can anyone please help me understand tax harvesting procedure in MF (SIP) , If I invested ?300000 lumpsum in A-MF which gave 12% returns in 1year total value would be 336000 if I sell this corpus after 366th day my investment is tax free(LTCG- MY RETURNS

Ans: It depends on type of scheme (equity or debt based scheme).

Short Term or Long Term depends on period of holding. Debt based scheme are always short term and taxable at slab rate. Equity based scheme are long term if it is sold after holding for 12 month or more. Long term capital gain on equity scheme is taxable at NIL rate upto 1 lacs of gain.

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Money

Mihir Tanna |831 Answers |Ask -Follow

Tax Expert - Answered on May 10, 2024

Asked by Anonymous - May 04, 2024Hindi

Hello, I am an Indian citizen who used to work in the Merchant Navy, which is exempted from tax as we operate on international waters. I accumulated savings during that tenure and invested them in Indian mutual funds. I have never filed an Income Tax Return (ITR) in India. Now, I live abroad on a work visa. I will be withdrawing some of my mutual funds. Am I liable to pay short-term tax? Should I file an ITR?

Ans: Yes, if you redeem MF, capital gain on MF is taxable. Depending type of scheme (equity/debt MF), tax rate will be applicable.

ITR filing in Mandatory for Individual having gross total income of more than 2.5L (Before 54 series exemption) or Deposit > 1 Cr in Current A/c OR Expense > 2 L for Foreign Travel Or Expense > 1 L for Electricity Or Sales > 60 L - Gross receipt profession > 10 L OR TDS/ TCS > 25K ( 50K senior citizen) OR Deposit > 50 L in Saving A/c

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Money

Mihir Tanna |831 Answers |Ask -Follow

Tax Expert - Answered on May 10, 2024

Question by Suresh - May 07, 2024Hindi

i have a small firm. deputed one staff with the one of client and paid them DA during the tour along with the tour travel expenses. whether this DA will be taxable ?

Ans: Yes DA is taxable

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Ramalingam Kalirajan |1896 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Question by Ranajit - Apr 22, 2024Hindi

I am 84 year old senior citizen. I withdrew two fixed deposit prematurely. Bank levied penal charges on premature withdrawal. Can I claim penal interest as deduction while filling ITR returns. Pl guide

Ans: No, unfortunately, you cannot claim the penalty levied on premature withdrawal of your fixed deposits (FDs) as a deduction while filing your Income Tax Return (ITR).

Here's why:

Income vs. Expense: The penalty on FD withdrawal is considered an expense incurred for breaking the terms of the deposit agreement. It's not directly related to earning income from the FD interest.
Tax Deductions: Income tax deductions are allowed for expenses incurred for generating taxable income. The penalty on FD withdrawal doesn't fall under this category.
Taxation on FD Interest for Senior Citizens:

Even though you cannot deduct the penalty, there might be some relief on the interest income itself:

Section 80TTB: If your total interest income from all FDs and Savings accounts is less than ?50,000 per year, you can claim a deduction under Section 80TTB of the Income Tax Act. This eliminates tax liability on that interest income.
No TDS for Senior Citizens: For senior citizens (above 75 years old), banks don't deduct TDS (Tax Deducted at Source) on FD interest up to ?50,000 per year from a specified bank where you receive your pension.
Recommendations:

Plan for Premature Withdrawals: If you foresee needing the money before the FD matures, consider shorter tenure FDs or opting for partially withdrawable FDs to avoid penalties.
Explore Tax-Saving Options: Look into tax-saving fixed deposits or senior citizen savings schemes (SCSS) that offer better interest rates and may not have high penalties for premature withdrawal.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Ramalingam Kalirajan |1896 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Asked by Anonymous - May 10, 2024Hindi

Hi Ramalingam, Hope you are doing well. Age 31, IT Professional (8 Years), Married, Nuclear Family, Mid level family business in small town. 1) Currently I am NRI from last 1 year and recently have bought Few mutual funds like UTI large cap Index, Parag Parikh flexi cap, Motilala Oswal Mid Cap, Quant & Nippon small cap funds. All are just started recently with total SIP of 28k monthly. 2) I have been investing in PPF from last 4 years. 3) Minor LIC and Company PF of around 4.5L. 4) No loans, EMI as of now, own family house and agricultural unutilized land. 5) Existing Equity shares of 3L which I bought 5 year earlier. 6) I am not looking for buying flats/apartment as such. The major mistake I feel was I didn't invest till now and had kept money in savings account idle, which I regret to some extent. Queries: 1) As currently I am an NRI, I wanted to know what are the taxation rules on my shares if I buy or sell. Also, I hope there should be no issues as I bought mutual funds being NRI as anyway at point of selling I will be resident indian hopefully. Should I increase the amount of SIP? I am looking for Step up SIP Of 5-10%. Should I go for International fund now? 2) I was thinking to invest in fixed deposits and govt bonds, am I eligible to do this or this will attract me more taxation. For your better understanding, Currently I am in Saudi Arabia. 3) Your suggestions related to investment in Equity, gold, debt are highly appreciated as it will guide me further. 4) What are better things to look out from investment perspective being an NRI 5) Can you please help me plan for an excellent financial stability plan if I want to retire early around 45-48 years that is in next 15 to 18 years from now. Thanks

Ans: I appreciate your detailed overview of your financial situation and your proactive approach to investing. Let's address each of your queries systematically to ensure we cover all aspects comprehensively.

1. Taxation on Shares and Mutual Funds: As an NRI, capital gains tax rules apply to your investments in shares and mutual funds in India. For equity investments held for over one year, long-term capital gains (LTCG) are taxed at 10% without indexation. For mutual funds, equity-oriented funds are treated similarly. However, if you become a resident Indian again, you'll be taxed as per the applicable resident Indian tax laws. Increasing your SIPs by 5-10% annually is a prudent strategy, especially considering your long-term investment horizon and the power of compounding. Regarding international funds, they can provide diversification benefits, especially during periods of rupee depreciation, but ensure you understand the associated risks before investing.

2. Investment in Fixed Deposits and Government Bonds: As an NRI, you are eligible to invest in fixed deposits and government bonds in India. Interest earned on fixed deposits is taxable in India, subject to applicable tax laws. Government bonds also carry tax implications, but specific rules depend on the type of bond and your residential status. Given your current location in Saudi Arabia, consider exploring NRI-specific investment options like NRE or NRO fixed deposits, which offer tax benefits and repatriation flexibility.

3. Investment Strategy: Diversification is key to a well-rounded investment portfolio. Equity investments offer long-term growth potential, while debt instruments like PPF provide stability and tax benefits. Considering your risk appetite and investment goals, continue your SIPs in equity mutual funds, but ensure you have an adequate emergency fund in place. Explore options like international funds for global exposure and consider increasing exposure to debt instruments for capital preservation.

4. Investment Considerations for NRIs: As an NRI, it's essential to stay informed about regulatory changes and tax implications related to your investments in India. Additionally, consider factors like currency risk, repatriation restrictions, and geopolitical developments when making investment decisions. Regularly review your portfolio and consult with a financial advisor to optimize your investment strategy based on changing market dynamics.

5. Early Retirement Planning: Achieving early retirement requires careful financial planning and disciplined saving and investing. Start by setting clear retirement goals, estimating your future expenses, and determining the required corpus. Maximize contributions to tax-efficient retirement accounts like EPF, PPF, and NPS. Consider allocating a portion of your portfolio to growth-oriented assets like equity mutual funds to generate inflation-beating returns over the long term. Regularly reassess your retirement plan and adjust your investment strategy as needed to stay on track towards your retirement goals.

By following a systematic approach to investing, staying informed about regulatory changes, and regularly reviewing your financial plan, you can work towards achieving financial stability and early retirement.

Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

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Money

Ramalingam Kalirajan |1896 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Question by Raghav - May 10, 2024Hindi

Hello Sir im turning 36 this Dec...Im not very old in MF investment however looking forward to being consistant...I want to build up a corpas of 50 lakh by age of 40..my invest as per below... Quant/kotak/axis small cap direct growth- 10K each/month(9 month old) parag parikh ELSS tax saver- 2K/month(12 month old) mirae asset ELSS tax saver-2.5K/month(3 year old) quant ELSS tax saver-3K/month(16 month old) Kotak ELSS tax saver-2K/month(16 month old) SBI PSU direct plan-3K/month( 1 month) Aditya birla sunlife PSU equity fund- 5K/month(1 month) need your expertise if I need to change funds...these are combined investment by me & my wife..TAX saver are required to avoid tax liability under 80C..aprat from this Im investing 40K/year in PPF valued 1lakh(3 year old)

Ans: It's great to see your commitment to building your investment portfolio. Let's review your current mutual fund investments and see if any adjustments are needed to align with your goal of accumulating a corpus of ?50 lakhs by the age of 40.
Your current allocation seems well-diversified across various mutual fund categories, including small-cap funds, ELSS tax savers, and sector-specific funds like SBI PSU and Aditya Birla Sunlife PSU equity funds. However, there are a few points to consider:
1. Small-Cap Funds: Investing in small-cap funds can offer high growth potential but comes with increased risk due to market volatility. Since you're relatively new to mutual fund investments, ensure you have a high risk tolerance and a long-term investment horizon for these funds.
2. ELSS Tax Saver Funds: It's wise to continue investing in ELSS funds to avail tax benefits under Section 80C. However, having multiple ELSS funds may lead to duplication of holdings and increase complexity without significantly diversifying your portfolio. Consider consolidating your ELSS investments into one or two funds with a proven track record and consistent performance.
3. Sector-Specific Funds: Funds like SBI PSU and Aditya Birla Sunlife PSU equity focus on specific sectors, which can be volatile and dependent on sectoral performance. While they offer the potential for high returns, they also carry higher risk. Ensure these funds complement your overall portfolio strategy and are not over-concentrated in a single sector.
4. PPF Investment: Investing in PPF is a good strategy for long-term wealth accumulation and tax-saving. However, keep in mind that PPF has a lock-in period of 15 years, so ensure it aligns with your liquidity needs and investment goals.
Considering the above points, here are some suggestions:
• Evaluate the performance of your existing funds and consider consolidating your ELSS investments into one or two funds with strong fundamentals and consistent performance.
• Monitor the performance of small-cap funds closely due to their higher volatility and consider rebalancing your portfolio if needed.
• Review your sector-specific fund investments periodically and ensure they align with your risk tolerance and investment objectives.
Lastly, it's essential to regularly review your investment portfolio and make adjustments as needed to stay on track towards your financial goals.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

Asked on - May 10, 2024 | Answered on May 10, 2024

Thank you for vastly explaining my port folio.....have one question regarding ELSS funds...can I stop investing in one fund wait for balance to mature as every SIP has a lock in period!! what happens when we stop SIP in ELSS funds... we couple both are working so I'm intending for high risk/high return for next 2-3 years...I have also start investing in stock(being cautious)

Ans: Absolutely, you can stop investing in one ELSS fund and allow the existing investments to mature. ELSS funds have a lock-in period of three years from the date of each investment, so once the lock-in period is over for each SIP, you have the option to either redeem the units or continue holding them.

When you stop SIPs in ELSS funds, the existing investments continue to grow, and you retain ownership of the units. However, keep in mind that stopping SIPs doesn't impact the lock-in period of the existing investments. Each SIP installment will have its own lock-in period of three years from its investment date.

If you're looking for high-risk, high-return investments for the next 2-3 years, it's essential to assess your risk tolerance and investment horizon carefully. ELSS funds, especially those investing in small-cap or mid-cap stocks, can be volatile in the short term but may offer higher returns over the long term.

Additionally, investing in individual stocks requires thorough research and a good understanding of the stock market. It's wise to approach stock investing cautiously, especially if you're relatively new to it. Diversification and thorough research are key to managing risk in stock investments.

Overall, it's great that you and your spouse are both working towards your financial goals and are open to taking calculated risks for potentially higher returns. Remember to regularly review your investment portfolio, stay informed about market developments, and adjust your strategy as needed to stay on track towards your goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Money

Ramalingam Kalirajan |1896 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Asked by Anonymous - Apr 19, 2024Hindi

I have booked a residential flat with a developer who shall be developing a scheme comprising of 6 flats, 3 of which shall be retained by the land owners and 3 shall be sold by the developer to buyers like me. The developer has entered into an agreement for redevelopment with the land owners and he shall be receiving sale price of the flat from 3 persons purchasing the flats, I am one of them as stated earlier. The redevelopment agreement between the land owner and the developer is only for constructing the structure. The Sale-Deed shall be executed between the Vendor -that is the original land owners and the Purchasers like me. The developer shall be the Confirming Party, confirming the receipt of the entier payment, against the purchase of the flat, delivery of possession to the purchasers like me. Therefore the sale deed shall be between the purchaser and the land owners. The developer has rendered the services to be taxed under the GST Act to the land owners. The Land owners may recover the GST paid/charged/recovered by the developer, from the 3 purchasers. My queries are: 1. What is the rate at which on the services of development/construction rendered on the piece of land are taxable under the GST Act? 2. If I presume, it is at 5%, in that case am I not required to pay 1/6th of the GST paid by the land lord and nothing more than this? 3. Can developer demand the GST on the entire cost of the flat including the cost of the undivided share of land falling to my share? The land, under the Sale-Deed is sold/transferred by the Land lord and not by the developer, under what authority he can demand 5% GST on the cost of the land? 4. Are we not buying a ready to move or a ready made flat although we have to pay on the basis of the stage wise completion of the building structure and therefore only 1% GST? Please guide.

Ans: You're right to be questioning the GST implications in this situation. Here's a breakdown of your queries:

GST Rate on Development Services: The GST rate for construction services on an immovable property (land + building) is generally 5%. However, there's an exception for affordable housing projects, where the rate is 1%.

Sharing of GST by Landowners and Purchasers: Since the sale deed is directly between you (purchaser) and the landowner (vendor), you are not obligated to pay 1/6th of the GST paid by the landowner to the developer. You'll only pay GST on the value mentioned in your sale deed.

GST on Land Cost: The developer cannot demand GST on the entire cost of the flat, including the undivided land share. GST applies to the value of services rendered (construction) and not the land itself.

GST on Ready-to-Move Flats: The GST rate of 1% for ready-to-move flats only applies to completed projects where the occupancy certificate has been issued. In your case, it's an under-construction project, so the 5% rate applies.

Here's how the GST should ideally work in your scenario:

The developer pays GST to the government on his service charges for constructing the flats (5% of his construction cost).
The landowner pays stamp duty and registration charges on the land value mentioned in your sale deed.
You, the purchaser, pay GST to the developer on the value mentioned in your sale deed (excluding land cost) at the rate of 5% (assuming it's not an affordable housing project).
Recommendations:

Ask the developer to provide a breakup of the total cost, clearly mentioning the land cost and construction service charges.
Pay GST only on the construction service charges mentioned in your sale deed.
If the developer insists on including GST on the land cost, consult a tax advisor to understand your rights and explore further options.
Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Ramalingam Kalirajan |1896 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Question by Colonel - May 05, 2024Hindi

Good afternoon. I am a retired government officer (Army Doctor) and have opened my own clinic recently. Income from the clinic is not significant as on date . Having approx ?90 lakhs in Mutual funds and invest in SIP ?20000/- per month. I have ?1Cr in FD, ? 30 lakhs in Senior Citizen Savings Scheme. Liquid cash in in bank accounts is around ? 35blakhs. I have 2 houses of which for 1 house is on rent for ?28000/- and 1 house I am paying EMI of ?35000/- and is self occupied. My pension being credited to bank is ?115000/-. I am 59y and my spouse is 54y. We don't have any children and health is covered by ECHS. Have my in laws and mother dependent. In laws covered by CGHS and mother by ECHS. Mother has a house in Kolkata self occupied. Father in law is drawing pension of ?70000/- pm. His FD and cash assets is ?60 lakhs. What is my financial health?

Ans: Good afternoon! It sounds like you've put a lot of thought into your financial setup, which is great. Let's break down your current financial situation.

Your assets include approximately ?90 lakhs in mutual funds, which is a substantial investment, along with ?1 crore in fixed deposits, and ?30 lakhs in the Senior Citizen Savings Scheme. Additionally, you have liquid cash of around ?35 lakhs, providing a comfortable cushion for any immediate expenses or emergencies.

Property-wise, you have two houses, one generating rental income of ?28,000 per month and the other being self-occupied with an EMI of ?35,000. Rental income is a reliable source of passive income, and your property investments seem well-balanced.

Your pension income of ?1,15,000 per month provides a stable cash flow, complemented by your spouse's financial support. Health coverage through ECHS and CGHS for your dependents is a significant relief, ensuring medical expenses are taken care of.

Considering your age and circumstances, it's prudent to assess your investment strategy and ensure it aligns with your long-term goals, especially with retirement looming. You may want to evaluate the performance of your mutual funds and explore diversification options to mitigate risk.

Your in-laws' financial stability, with a pension of ?70,000 per month and assets worth ?60 lakhs, adds a layer of security to your family's overall financial health.

In summary, your financial health appears robust, with a diverse portfolio of investments, stable income streams, and adequate provisions for healthcare and dependents. As you approach retirement, continued vigilance and periodic reviews of your financial plan will help maintain and enhance your financial well-being.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Ramalingam Kalirajan |1896 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Asked by Anonymous - May 04, 2024Hindi

Which guaranteed plan is better

Ans: When considering guaranteed plans, it's crucial to tread cautiously. These plans promise security but come with their own set of limitations. They often boast a fixed return rate, but this can be considerably lower than what other investment avenues offer. It's like having a sturdy boat that moves slower than the rest.

One of the major perils of guaranteed plans is their inability to beat inflation. While they assure stability, they often fail to keep up with the rising cost of living. It's akin to being stuck in a time warp where your money loses its purchasing power over time.

Moreover, guaranteed plans usually come with a lock-in period, restricting access to your funds for a specified duration. This lack of liquidity can be a hurdle, especially during emergencies or when better investment opportunities arise. It's like having your money in a vault with the key out of reach.

As a Certified Financial Planner, I understand the allure of guaranteed plans, especially for those seeking a safe haven for their hard-earned money. However, it's essential to weigh the pros and cons carefully. While they provide stability, they may not offer the growth potential needed to meet long-term financial goals.

In the realm of investments, it's often a trade-off between risk and reward. While guaranteed plans offer security, they may not generate returns substantial enough to beat inflation or meet future needs. Diversifying your portfolio with a mix of investments tailored to your goals and risk tolerance is key to financial success.

Remember, it's not about finding the perfect plan, but rather crafting a well-rounded strategy that aligns with your aspirations and circumstances.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Ramalingam Kalirajan |1896 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Question by Manjunath - May 05, 2024Hindi

I am MANJUNATH. I am central government employee. My monthly earning is 50k. I have 25 lack home loan and 5 lack personal loan. 3 years remaining to retire. Please suggest any financial plan for future.

Ans: Hello Manjunath,
It's good to hear that you're thinking about your financial future, especially with retirement approaching. Here's a suggested financial plan to help you prepare:
1. Debt Management: Start by prioritizing debt repayment. Focus on clearing high-interest debts like your personal loan first while making minimum payments on your home loan. Once the personal loan is paid off, allocate extra funds towards reducing your home loan burden.
2. Emergency Fund: Build an emergency fund to cover at least 3-6 months' worth of living expenses. This fund will provide a financial safety net in case of unexpected expenses or emergencies.
3. Retirement Planning: Since retirement is just 3 years away, it's crucial to focus on building your retirement corpus. Maximize contributions to your Employees' Provident Fund (EPF) and consider investing in additional retirement-focused schemes like the National Pension System (NPS) for additional tax benefits and long-term growth.
4. Investment Strategy: Develop a diversified investment portfolio that aligns with your risk tolerance and financial goals. Consider a mix of equity mutual funds, debt funds, and other investment avenues like Public Provident Fund (PPF) and Sukanya Samriddhi Yojana (if you have children). Regularly review and rebalance your portfolio to ensure it remains aligned with your goals.
5. Insurance Coverage: Ensure you have adequate insurance coverage, including health insurance and life insurance. Review your existing policies to make sure they meet your current needs and consider increasing coverage if necessary.
6. Financial Planning for Post-Retirement: Start planning for your post-retirement financial needs, including healthcare expenses, daily living costs, and any additional goals or aspirations you may have. Consider factors such as inflation and potential changes in lifestyle when estimating your retirement expenses.
7. Consultation with a Financial Advisor: Consider consulting with a Certified Financial Planner who can provide personalized advice tailored to your specific financial situation and retirement goals. They can help you create a comprehensive financial plan and guide you on how to achieve your objectives efficiently.
By following these steps and staying disciplined in your financial management, you can work towards securing a comfortable and financially stable future for yourself post-retirement.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

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Ramalingam Kalirajan |1896 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Question by Narendra - May 10, 2024Hindi

Hello Ulhas, Hope you are doing good. My current age 35, I am planning to invest as SIP 60K monthly for 15 years. My goal is 2 crore after 15 years. Below are the schemes I choose. Kindly review and suggest changes if any Midcap Fund Motilal Oswal Midcap Fund Direct-Growth 4K, Mahindra Manulife Mid Cap Fund Direct - Growth 4K, Smallcap Fund Axis small cap direct growth 4k, Canara robecco small cap 4K, quant small cap 4K, Nippon small cap 4K, Mid and Largecap Mirae Asset Emerging Bluechip fund 4K, Axis Growth Opportunities Fund Direct - Growth 4K, Multicap Mahindra Manulife Multi Cap Fund Direct - Growth 4K, HDFC Multi-Cap Fund Direct - Growth - 4K, Mirae Asset Multicap Fund Direct - Growth 4k, Canara Robeco Multi Cap Fund Direct - Growth 4K, Flexi Parag Parikh Flexi Cap Fund Direct-Growth 4K, Quant Flexi Cap Fund Direct-Growth 4K, Value Tata Equity PE Fund Direct-Growth - 4K

Ans: Hello,

It's great to hear about your investment plan. Let's review your chosen schemes and make some suggestions:

Midcap Funds (Motilal Oswal, Mahindra Manulife, Axis Small Cap, Canara Robecco, Quant, Nippon): Midcap and small-cap funds have the potential for high growth but come with higher volatility. Consider consolidating your investments into 2-3 well-performing midcap and small-cap funds to reduce overlap and manage risk better.
Mid and Large-cap (Mirae Asset Emerging Bluechip): This fund provides a blend of mid and large-cap exposure, offering stability and growth potential. It's a good choice for diversification.
Multicap Funds (Mahindra Manulife, HDFC, Mirae Asset, Canara Robeco): Multicap funds provide diversification across market segments and flexibility to capitalize on opportunities across market capitalizations. Your selection offers a good mix of well-established funds in this category.
Flexi Cap Funds (Parag Parikh, Quant): Flexi-cap funds offer flexibility to invest across market caps based on market conditions. Your chosen funds provide diversification and align with your investment strategy.
Value Fund (Tata Equity PE Fund): Value funds focus on undervalued stocks with the potential for long-term growth. Consider the performance track record and investment philosophy of this fund before investing.
Overall, your portfolio is well-diversified across various market segments, which is essential for managing risk and maximizing returns. However, having such a large number of funds may lead to over-diversification and complexity. Consider consolidating your investments into a more streamlined portfolio with a focus on quality funds with consistent performance track records.

There are some advantages to consider direct funds, and the cost savings can be significant in the long run. However, there are some potential benefits to using a regular MFD:
Advantages of Investing Through a Mutual Fund Distributor (MFD):
• Personalized Advice: MFDs can be helpful for beginners or those who lack investment knowledge. They can assess your risk tolerance, financial goals, and investment horizon to recommend suitable mutual funds. This personalized guidance can be valuable, especially if you're new to investing.
• Convenience: MFDs handle all the paperwork and transactions on your behalf, saving you time and effort. They can help with account setup, SIP registrations, and managing your portfolio across different funds.
• Investor Support: MFDs can be a point of contact for any questions or concerns you may have about your investments. They can provide ongoing support and guidance throughout your investment journey.

Regularly review your portfolio's performance and make necessary adjustments to stay aligned with your financial goals. Consulting with a Certified Financial Planner can provide personalized guidance tailored to your specific needs and objectives.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Ramalingam Kalirajan |1896 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Question by Shivanshu - May 10, 2024Hindi

I am 24 and investing 60k per month in stock and MF. My current saving is 12L . I am planning to build a Hostel in my native place by 30 which will give me approx 50k per month. Is this a good idea?

Ans: Starting a hostel can indeed be a lucrative business venture, especially considering the rising demand for affordable accommodation, especially in areas with educational institutions or commercial hubs. Here are some factors to consider:

Market Research: Conduct thorough market research to understand the demand for hostel accommodation in your native place. Evaluate factors such as location, competition, target market, and potential occupancy rates.
Financial Feasibility: Assess the financial feasibility of your hostel project. Consider startup costs, construction expenses, operational costs, and potential revenue streams. Ensure that your projections are realistic and factor in contingencies.
Regulatory Compliance: Familiarize yourself with the regulatory requirements and legal procedures for setting up and operating a hostel. Obtain necessary permits, licenses, and approvals from local authorities to avoid any legal hassles in the future.
Management and Operations: Determine how you'll manage the hostel efficiently. Consider aspects such as staff hiring, property maintenance, security measures, and customer service. Developing a robust management plan is crucial for the success of your venture.
Risk Management: Identify and mitigate potential risks associated with the hostel business, such as fluctuating occupancy rates, property maintenance issues, regulatory changes, and economic downturns. Having a risk management strategy in place can safeguard your investment.
Financial Planning: Evaluate the financial implications of starting a hostel on your personal finances. Assess whether you have sufficient capital to fund the project or if you'll need to secure financing through loans or investors. Consider the impact of this investment on your overall financial goals and risk tolerance.
Before proceeding with your hostel venture, I recommend consulting with industry experts, financial advisors, and legal professionals to gain insights and guidance. With careful planning, thorough research, and diligent execution, starting a hostel could be a rewarding endeavor.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Question by Amar - May 10, 2024Hindi

Hi Ram, I invest in PPF, VPF & have also bought shares of Accenture via ESPP mode. But I want to go for mutual funds as I have heard that it gives handsome returns. Funds like Parag parikh flexi cap funds, Quant mid cap funds, Hdfc flexi cap funds, Nippon India small cap funds & mirae assets large cap funds are under my investigation. Could you please give your expert view on this? Thanks, Amar

Ans: Hello Amar,
It's great to see your interest in diversifying your investment portfolio with mutual funds. You're already on the right track with your investments in PPF, VPF, and shares via ESPP mode. Let's evaluate the mutual fund options you're considering:
• Parag Parikh Flexi Cap Fund: This fund adopts a flexible approach, investing across market capitalizations and geographies. Its global exposure can provide diversification benefits and potentially higher returns.
• Quant Mid Cap Fund, HDFC Flexi Cap Fund, Nippon India Small Cap Fund: These funds focus on mid and small-cap segments, known for their growth potential. However, they also come with higher volatility and risk. It's essential to assess your risk tolerance before investing significantly in these funds.
• Mirae Asset Large Cap Fund: Large-cap funds like these offer stability and consistency in returns. While they may not provide explosive growth like mid and small-cap funds, they offer reliability, making them suitable for investors with a lower risk appetite.
When choosing mutual funds, consider factors such as your investment horizon, risk tolerance, and financial goals. Diversification across different fund categories can help mitigate risk while maximizing returns.
As a Certified Financial Planner, I recommend consulting with a professional to create a well-balanced investment portfolio tailored to your specific needs and objectives.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Question by Souhreed - May 10, 2024Hindi

Hello - Please assess my mutual fund portfolio. Below are the details: Age-31yrs; Portfolio Age - 7 years (started with a lesser number of funds in 2017 at 5k); Amount Invested - 16.45L Current Value - 25.70L; Monthly SIP - 85k; Portfolio Annualized Return - 20.20%; Increase in SIP - 5-10% annually; Goal - 15cr by 2042; (a).SBI Blue Chip Fund-4k (b).Mirae Asset Large Cap Fund-1k (c).ICICI Prudential Large and Midcap Fund-10k (d).SBI Large and Midcap Fund-10k (e).HDFC Mid-Cap Opportunities Fund-10k (f).KOTAK SMALL CAP FUND-5k (g).Nippon India Small Cap Fund-5k (h).ICICI Prudential Value Discovery-5k (i).HDFC Balance Advantage Fund-5k (j).PARAG PARIKH FLEXI CAP FUND-25k (h).UTI NIFTY INDEX FUND GROWTH PLAN-5k

Ans: Your mutual fund portfolio demonstrates a commendable commitment to long-term wealth accumulation, especially given the significant growth in value and the impressive annualized return of 20.20%. Let's assess your portfolio components and make some recommendations:
1. SBI Blue Chip Fund: With a conservative approach, this fund provides stability and growth potential through investments in large-cap companies. Your allocation of 4k seems reasonable for diversification.
2. Mirae Asset Large Cap Fund, ICICI Prudential Large and Midcap Fund, SBI Large and Midcap Fund: These funds offer exposure to both large and mid-cap segments, providing diversification across market capitalizations. Your allocations are well spread out, contributing to portfolio resilience.
3. HDFC Mid-Cap Opportunities Fund, KOTAK SMALL CAP FUND, Nippon India Small Cap Fund: These funds target mid and small-cap segments, which historically offer higher growth potential. However, they also come with increased volatility. Considering your risk appetite, you might want to review your allocations and ensure they align with your risk tolerance.
4. ICICI Prudential Value Discovery: This fund follows a value-oriented investment strategy, focusing on undervalued stocks with the potential for long-term growth. It adds depth to your portfolio diversification.
5. HDFC Balance Advantage Fund: This dynamic asset allocation fund aims to provide stable returns by adjusting equity exposure based on market valuations. It serves as a hedge during market downturns, enhancing portfolio stability.
6. PARAG PARIKH FLEXI CAP FUND: Known for its flexible investment approach across market capitalizations, this fund complements your portfolio well. Its exposure to international equities adds diversification benefits.
7. UTI NIFTY INDEX FUND GROWTH PLAN: While index funds offer low-cost exposure to market indices, they lack the potential for outperformance compared to actively managed funds. Given your diversified portfolio, it's advisable to review the need for this fund and potentially reallocate the investment to actively managed funds with higher growth potential.
Considering your goal of achieving 15cr by 2042, it's crucial to maintain a disciplined approach towards savings and investment. You're already on the right track with your increasing SIP contributions annually. Regularly review your portfolio's performance and rebalance if necessary to stay aligned with your long-term objectives.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

Asked on - May 10, 2024 | Answered on May 10, 2024

Thank you, Sir, for the thorough review of my portfolio. It would be very helpful if you could recommend a fund where I can re-allocate the 5k from 'UTI NIFTY INDEX FUND GROWTH PLAN'

Ans: It's not advisable to recommend a fund in an online forum without understanding the full background of the individual's financial situation and investment goals for several reasons:

Risk Profile: Each investor has a unique risk tolerance based on factors such as age, financial obligations, income stability, and investment experience. Recommending a fund without considering these factors can lead to investments that are unsuitable or too risky for the individual.
Investment Goals: Investors have different financial goals, such as wealth accumulation, retirement planning, or saving for a specific milestone. The recommended fund should align with these goals and the investment timeframe. Without understanding the investor's objectives, recommending a fund may not serve their long-term interests.
Financial Circumstances: Factors like income level, existing investments, debt obligations, and emergency savings influence an individual's capacity to invest and tolerate market fluctuations. Recommending a fund without considering these factors may not be appropriate for their financial circumstances.
Tax Considerations: Tax implications vary based on the type of investment, investment duration, and the investor's tax bracket. Recommending a fund without knowledge of the individual's tax situation may lead to suboptimal tax planning.

In summary, recommending a fund without understanding the full background of the investor can lead to suboptimal investment decisions, potential risks, and regulatory issues. It's essential to conduct a thorough assessment of the investor's financial situation, risk tolerance, investment goals, and regulatory compliance before making any recommendations.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Asked by Anonymous - May 06, 2024Hindi

Hi sir I am 42 year old and have a lumpsum amount of 40lakh to invest but have no idea where to invest.Currently paying 22500 monthly sip in mutual fund. I am thinking of investing in property or SWP or pension plan. Kindly guide me to choose right option or you have any other option which you can suggest. My goal is to save money for my child's higher education and lively hood for me after retirement.

Ans: I appreciate your proactive approach to financial planning. With your lump sum amount of 40 lakh and ongoing SIP investments, you're in a good position to enhance your financial portfolio. Considering your goals of saving for your child's higher education and securing your livelihood post-retirement, let's explore your options:
1. Property Investment: While property investment can offer long-term appreciation potential, it also comes with significant costs, illiquidity, and maintenance hassles. Given your goals and the unpredictability of the real estate market, it might not be the most suitable option.
2. SWP (Systematic Withdrawal Plan): SWP can provide you with a regular income stream by redeeming units from your mutual fund investments. It's a flexible option that allows you to tailor the withdrawal amount according to your needs. However, the sustainability of SWP depends on the performance of your underlying investments.
3. Pension Plan: Opting for a pension plan can help secure a steady income stream during your retirement years. It offers the benefit of guaranteed payouts, but the returns may be lower compared to other investment avenues. Additionally, pension plans may lack flexibility in terms of contributions and withdrawals.
Considering your age and goals, I'd suggest exploring a combination of options:
• Continue SIPs: Maintain your ongoing SIPs to capitalize on rupee cost averaging and benefit from long-term compounding.
• Diversified Mutual Fund Portfolio: Allocate a portion of your lump sum amount to diversify your mutual fund portfolio across equity and debt funds, aligning with your risk tolerance and investment horizon.
• Emergency Fund: Set aside a portion of your lump sum for an emergency fund to cover unforeseen expenses.
• Term Insurance and Health Insurance: Ensure you have adequate insurance coverage to safeguard your family's financial well-being.
• Regular Financial Reviews: Periodically review your investment portfolio and adjust your strategy as needed to stay on track towards your goals.
As a Certified Financial Planner, I recommend consulting with a professional to create a customized financial plan tailored to your specific needs and objectives.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Question by Prajwal - May 06, 2024Hindi

I would need your little help with the Goal-based investments. I am doing goal-based investments and suppose I have 3 different goals - Child's education, Buying a house, and Generate Post-retirement monthly income. So, should we consider these as individual goals and allocate mutual funds to each of these separately? If yes, while allocating funds to these different goals, can we keep the same MF in two different goals? For example, can I invest in the "ICICI Prudential Bluechip Fund - Direct Plan" fund into two different goals that I have? How much % of Equity should I plan for each term duration: Long-term (20 years), Medium-term (8-10 years), and Small-term (5 years).

Ans: When it comes to goal-based investments, it's essential to treat each goal separately to ensure clarity and focus. Each goal has its unique timeline, risk tolerance, and financial requirements.

Allocating mutual funds to each goal individually helps tailor your investments to meet the specific needs of that goal. However, you can use the same mutual fund for different goals if it aligns with the respective timelines and risk profiles.

For instance, if a mutual fund fits the risk profile and time horizon of both your child's education and post-retirement income goals, it's feasible to invest in it for both goals.

There are some advantages to consider direct funds, and the cost savings can be significant in the long run. However, there are some potential benefits to using a regular MFD:
Advantages of Investing Through a Mutual Fund Distributor (MFD):
• Personalized Advice: MFDs can be helpful for beginners or those who lack investment knowledge. They can assess your risk tolerance, financial goals, and investment horizon to recommend suitable mutual funds. This personalized guidance can be valuable, especially if you're new to investing.
• Convenience: MFDs handle all the paperwork and transactions on your behalf, saving you time and effort. They can help with account setup, SIP registrations, and managing your portfolio across different funds.
• Investor Support: MFDs can be a point of contact for any questions or concerns you may have about your investments. They can provide ongoing support and guidance throughout your investment journey.

Regarding asset allocation, the percentage of equity you should plan for each term duration depends on various factors such as your risk tolerance, time horizon, and financial goals.

For long-term goals like retirement planning or your child's education (20 years or more), a higher allocation to equity may be suitable, given the potential for higher returns over the long run.

For medium-term goals (8-10 years), a balanced approach with a mix of equity and debt investments can help manage risk while aiming for reasonable growth.

For short-term goals (5 years or less), a more conservative approach with a higher allocation to debt investments may be prudent to safeguard capital and ensure liquidity when needed.

Remember, asset allocation is a dynamic process that may require periodic review and adjustments based on changes in your financial situation and market conditions.

As a Certified Financial Planner, I encourage you to consult with a professional to develop a personalized investment plan tailored to your specific goals, risk tolerance, and financial circumstances.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Asked by Anonymous - May 06, 2024Hindi

I'm 22, fresher with 5LPA about to relocate to Bangalore for job. Before I start my career I want to have a clear overview regarding my finances and how to manage them, where do I invest and how much. Looking over long terms goals maybe a house or retirement by 50 to 60 years. What all shall I do to keep in my mind to achieve these goals. Kindly suggest and guide, open to all such suggestions. Thank you!

Ans: Congratulations on starting your career journey! Here's a roadmap to manage your finances and achieve your long-term goals:
1. Budgeting: Start by creating a monthly budget to track your income and expenses. Allocate a portion of your income towards savings and investments.
2. Emergency Fund: Build an emergency fund equivalent to at least 3 to 6 months' worth of living expenses. This fund acts as a safety net during unexpected financial setbacks.
3. Debt Management: Avoid accumulating high-interest debt. If you have any existing loans, prioritize paying them off to reduce financial stress and free up funds for savings and investments.
4. Investment Strategy:
• Start investing early to benefit from the power of compounding.
• Consider investing in equity mutual funds for long-term growth potential. Diversify your portfolio across different asset classes to manage risk.
• Explore options like Public Provident Fund (PPF) and Employee Provident Fund (EPF) for retirement planning. Contribute regularly to these accounts for tax benefits and long-term wealth accumulation.
5. Goal Setting:
• Identify your long-term financial goals, such as buying a house or retiring by age 50 to 60.
• Break down these goals into smaller, manageable targets. Set specific timelines and savings targets for each goal.
6. Real Estate: If buying a house is a long-term goal, start researching the real estate market in Bangalore. Consider factors like location, budget, and future growth prospects before making a purchase decision.
7. Retirement Planning:
• Start contributing to retirement accounts like EPF and consider opening a separate retirement savings account or investing in retirement-focused mutual funds.
• Aim to save at least 15% to 20% of your income towards retirement to maintain your desired lifestyle post-retirement.
8. Continuous Learning: Stay informed about personal finance and investment strategies. Attend workshops, read books, or seek guidance from a Certified Financial Planner to make informed decisions.
9. Review and Adjust: Regularly review your financial plan and investment portfolio. Adjust your strategy as needed based on changes in your life circumstances, goals, and market conditions.
By following these steps and staying disciplined with your finances, you can pave the way towards a secure financial future and achieve your long-term goals.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Asked by Anonymous - May 06, 2024Hindi

I'm 52 years male with 2 crore self house, shop worth 1.8 crore possession with 18 months , a garage commercial on rent receivable of 40k every month, approx 2 crore with cash in hand , want to accumulate a corpus of 10 Crore with 10 years , having no income right now. No loans and liabilities i have currently.Monthly expenses of 1.25 to 1.5 laks per month Wife 42 years , Sons 18 & 11 years , daughter 21 years. Medical insurance of 15 laks. Please advice an achievable plan of investment.

Ans: With your assets and goals in mind, let's craft a plan to accumulate a corpus of 10 Crore in 10 years:

Firstly, let's leverage your existing assets:

Your self-owned house and shop are valuable assets that can provide stability and potential appreciation over time.
The commercial garage rental income adds to your monthly cash flow, which is a positive aspect for your financial planning.
Given your current cash reserve:

Utilize a portion of your cash reserve for immediate expenses and emergencies.
Allocate the remaining amount strategically towards investments that align with your long-term goal.
Considering your lack of current income:

Explore investment avenues that offer a balance of capital appreciation and regular income generation.
Focus on creating a diversified investment portfolio to spread risk and maximize returns over the long term.
For your monthly expenses:

Ensure that your investment strategy takes into account your monthly expenditure needs, aiming for a balance between growth and liquidity.
Regarding your family's financial security:

Continue to maintain adequate medical insurance coverage to safeguard against unforeseen health expenses.
Consider allocating a portion of your investment towards education and future financial needs of your children.
Remember:

Regularly review your investment portfolio and adjust your strategy as needed to stay on track towards your goal.
Seek guidance from a Certified Financial Planner to fine-tune your investment plan and address any concerns or uncertainties.
With diligence and a well-thought-out strategy, achieving your financial goal is within reach.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Asked by Anonymous - May 04, 2024Hindi

I'm 41 year old with below investments - EPF corpus so far - 1cr - SGB - 10 lacs - PPF - 10 lacs , SSY- 6 lacs - FDs - 75 lacs - Mutual funds ( spread across various caps) - 70 lacs - Stocks - 75 lacs - ESOP ( vested ) - 35 lacs - rate of current savings (90K MF monthly, plus additional 40 lacs annually) - Land bought - current value 50 lacs (long term with holding period around 20 years - backup for kids marriage expenses ) My near term expenses a) buying a home (around 1.7 cr) b) kids education - need to build a corpus of 2 Cr in next 5 years ( kid is 6 year old currently) c) building a retirement corpus to maintain 1.5 lacs expenditure monthly ( inflation adjusted) want to retire at 55 and considering life span of 75 years. Please guide me any steps towards these goals . Ideally would like to retire at 50 but would put a strain with respect to kids college education.

Ans: Given your current financial position and goals, it's crucial to create a strategic plan to achieve them effectively. Let's break it down:
For your near-term expenses:
• Allocate a portion of your savings towards the home purchase, considering a down payment and subsequent EMIs.
• To build a corpus for your child's education, consider investing in a mix of equity and debt instruments with a focus on growth.
For your retirement goals:
• With a desire to retire at 55 and a lifespan goal of 75 years, you have around 14 years to build your retirement corpus.
• Utilize a combination of equity, debt, and balanced mutual funds to achieve long-term growth while mitigating risk.
• Regularly review and adjust your investment portfolio to align with changing life stages and market conditions.
Considering your current investments:
• Diversify your portfolio further to spread risk and maximize returns.
• Explore options like systematic investment plans (SIPs) in mutual funds to benefit from rupee cost averaging and compounding over time.
Regarding your desire to retire at 50:
• While ambitious, it's essential to weigh the potential strain on your child's education corpus.
• Evaluate the feasibility of early retirement by assessing your current savings rate, expected returns, and future income streams.
Remember:
• Keep a close eye on your investments and make informed decisions based on your financial goals and risk tolerance.
• Consult with a Certified Financial Planner periodically to review your plan and make necessary adjustments.
Wishing you success in achieving your financial aspirations!
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Asked by Anonymous - May 06, 2024Hindi

Hi, I am 41 year old with my wife and 3 kids. I have already invested 390000 in various mfs and currently sip of 15,000 pm. Also I am investing 50000 per year in NPS from past 3 years I want to retire at age of 52 year. My current expense is 50,000 pm. How do I get 70,000 after my reimbursement. Please advise. Thanks.

Ans: It's commendable that you're planning ahead for your retirement while supporting your family. Let's strategize:

Firstly, kudos on your investments in mutual funds and NPS. They're valuable assets that can help you achieve your retirement goal.

Your SIP of 15,000 per month and NPS contributions of 50,000 annually demonstrate a proactive approach towards building your retirement corpus.

To bridge the gap between your current expenses and desired post-retirement income, you need to focus on increasing your savings and optimizing your investment strategy.

Consider boosting your SIP contributions or exploring additional investment avenues to accelerate wealth accumulation. A Certified Financial Planner can assist you in identifying suitable investment options aligned with your risk tolerance and goals.

It's crucial to review your portfolio periodically and rebalance it as needed to ensure optimal performance and risk management.

While direct funds offer lower expense ratios, investing through a Mutual Fund Distributor (MFD) with a CFP credential provides personalized advice and ongoing support, enhancing the effectiveness of your investment strategy.

As retirement approaches, consider gradually shifting your investment allocation towards more conservative options to protect your capital and generate stable income post-retirement.

Remember, retirement planning is a journey, not a destination. Stay disciplined, continue saving diligently, and seek professional guidance to navigate the complexities of financial planning.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Question by Asma - May 06, 2024Hindi

I am 50 years old i have an income of 20000 per mont? .i want to save money for my.daughter marriage and for old age pension .where to invest money of 3lakhs for these achievement or goals

Ans: It's great that you're planning ahead for your daughter's marriage and your old age pension. Let's dive into your options:

With an income of 20,000 per month, saving 3 lakhs might take some time, but it's definitely achievable with proper planning and discipline.

Given your goals, it's essential to strike a balance between safety, growth, and liquidity in your investments. Here's what you can consider:

Fixed Deposits (FDs): FDs offer safety and guaranteed returns. You can consider investing a portion of your savings in FDs to ensure capital preservation for your daughter's marriage.
Debt Mutual Funds: Debt mutual funds provide relatively higher returns than FDs while maintaining liquidity. They're suitable for medium-term goals like your daughter's marriage. Opt for funds with a track record of stable returns and low volatility.
Public Provident Fund (PPF): PPF is a popular long-term investment option offering tax benefits and steady returns. It can serve as a retirement corpus for you, providing financial security in your old age.
Senior Citizen Savings Scheme (SCSS): SCSS is designed for individuals above 60 years and offers regular income post-retirement. You can consider investing a portion of your savings in SCSS to build a pension corpus for your old age.
Gold ETFs: Investing in Gold ETFs can provide diversification to your portfolio and act as a hedge against inflation. You can allocate a small portion of your savings to Gold ETFs for long-term wealth preservation.
As you're nearing retirement age, it's crucial to prioritize building a robust retirement corpus alongside saving for your daughter's marriage. Consult with a Certified Financial Planner to create a comprehensive financial plan tailored to your goals and risk profile.

Remember, consistency and discipline are key to achieving your financial aspirations. Keep saving regularly, and you'll steadily progress towards your goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Question by Swabhiman - May 05, 2024Hindi

28 year old unmarried male having govt job and salary of 28000 with annual increment of 10%. How and where to invest money how much money to have 5lakh in 3 year?

Ans: It's great that you're thinking about investing for your future at such a young age. Let's break it down:

Firstly, congratulations on your government job! It provides stability and a steady income stream, which is a fantastic foundation for your financial journey.

Considering your salary and annual increment, it's essential to budget wisely and set aside a portion for savings and investments each month. This disciplined approach will help you achieve your financial goals.

To accumulate 5 lakhs in 3 years, you'll need to invest regularly and wisely. Since your investment horizon is relatively short-term, it's prudent to focus on instruments with moderate risk and potential for growth.

Avoiding real estate is a smart move, given the illiquidity and high capital requirements associated with it. Instead, consider options like mutual funds, which offer diversification and professional management.

While index funds are popular for their low costs, they may not suit your preferences due to their passive management style. Actively managed funds, on the other hand, offer the potential for higher returns through skilled fund managers' active management and research.

Direct funds might seem appealing for their lower expense ratios, but they lack the personalized advice and ongoing support that come with regular funds invested through a Certified Financial Planner. The guidance of a CFP can help you navigate the complexities of the market and make informed investment decisions.

As a Certified Financial Planner, I can assist you in creating a customized investment plan tailored to your goals, risk tolerance, and time horizon. Together, we can explore suitable investment avenues and monitor your progress towards achieving your financial aspirations.

Remember, patience and consistency are key to investment success. Stay focused on your goals, and don't hesitate to seek professional guidance whenever needed.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Question by Nitin - May 04, 2024Hindi

Could you please advise funds for SWP want to invest 50lac

Ans: Setting up a Systematic Withdrawal Plan (SWP) with an initial investment of 50 lakhs requires careful selection of mutual funds to ensure steady income while preserving capital. Here are some suggestions:
1. Debt Mutual Funds: Opt for debt funds for stability and regular income. Consider funds with a track record of consistent returns and low volatility, such as liquid funds or short-term debt funds. These funds provide relatively predictable returns and liquidity for your withdrawal needs.
2. Balanced Advantage Funds: These funds dynamically allocate between equity and debt based on market conditions. They offer the potential for capital appreciation along with regular income through systematic withdrawals. Look for funds with a proven strategy and experienced fund management team.
3. Monthly Income Plans (MIPs): MIPs invest in a mix of debt and equity instruments, aiming to provide regular income to investors. They are suitable for investors seeking a balance between income and growth. Choose MIPs with a conservative allocation to equities to minimize risk.
4. Equity Savings Funds: These funds invest in a combination of equity, debt, and arbitrage opportunities. They offer potential capital appreciation from equity exposure while providing downside protection through debt allocation. Select funds with a proven track record of managing volatility and generating consistent returns.
5. Dynamic Asset Allocation Funds: These funds adjust their asset allocation dynamically based on market valuations and economic indicators. They aim to provide steady returns across market cycles by shifting between equity and debt. Look for funds managed by experienced fund managers with a disciplined investment approach.
Before investing, assess your risk tolerance, investment horizon, and income requirements. Consult with a Certified Financial Planner to tailor a SWP strategy that aligns with your financial goals and risk profile.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Question by Narayan - Apr 23, 2024Hindi

Dear Sir / madam , I am an NRI , and having some investments in India. I have question on stocks I have purchased more than 10 years back. Few of them are all high profile company stocks. In case , I I sell now , will it be taxable , I mean TDS will be applied ? It is my NRE account linked to it. Will there be any tax cut ? Same way I have few mutual funds , If I redeem ( after maturity or end of its term) it , will there be any TDS applied before crediting to my account ? Please advise.

Ans: I'll address your inquiries about TDS and capital gains tax for NRIs selling stocks and redeeming mutual funds:

Stocks (Held for More Than 1 Year):

Taxable: Yes, profits from selling stocks held for over a year are considered long-term capital gains (LTCG) and are taxable in India for NRIs.
TDS: The stock broker will deduct TDS at 10% of the LTCG amount.
Tax Rate: The actual tax liability on LTCG exceeding ?1 lakh (approx. $1,235) is 10% without indexation (inflation adjustment). This means you may be due a refund if your total tax liability is below 10%.
NRE Account: Holding the stocks in your NRE account doesn't affect the taxability.
Mutual Funds:

Tax Treatment: The tax treatment for mutual fund redemptions by NRIs depends on the type of fund:
Equity-Oriented Mutual Funds (Equity & Equity-Linked Savings Schemes):
Short-Term Capital Gains (STCG): Gains from redemptions within 1 year are taxed at 15% with TDS deducted at the same rate.
LTCG: Gains from redemptions after 1 year are taxed at 10% on gains exceeding ?1 lakh, with TDS deducted at 10%.
Debt-Oriented Mutual Funds: Gains are considered income from other sources and taxed at a flat rate of 30% with TDS deducted at the same rate.
Recommendations:

Calculate Your Tax Liability: To determine if you'll owe additional tax or are eligible for a refund, calculate your total LTCG and factor in the TDS deducted.
File an Income Tax Return: Even if your tax liability is less than the TDS deducted, consider filing an Indian income tax return to claim any potential refund.
Consult a Tax Advisor: For personalized advice specific to your situation and to explore potential tax-saving options, consult a qualified tax advisor specializing in NRI taxation.
Additional Notes:

You can claim exemptions under relevant sections of the Income Tax Act (e.g., Section 54EC for reinvestment in specific bonds) to reduce your tax liability.
TDS is a mechanism to collect tax upfront, but it doesn't represent your final tax obligation.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Question by pk - Apr 23, 2024Hindi

I have been investing for 10 years in a mutual fund and as of now, my corpus is 5 cr. I would like to reach 100 cr in the next 10 years. if you can suggest approximately how much I need to invest to reach my target in the next 10 years. I prefer to invest in mutual funds because I don't have much knowledge of stocks and also do not have time to research. I would like to invest in lumpsum and sip.

Ans: Congratulations on building a significant corpus over the past decade! Reaching 100 crores in the next 10 years is an ambitious goal, but with a strategic approach, it's achievable. Let's evaluate your options:

Given your preference for mutual funds and your desire for a hands-off approach, SIP (Systematic Investment Plan) is an excellent choice. It allows you to invest regularly without the need for extensive research or monitoring.

To estimate how much you need to invest, we'll consider factors like your expected rate of return and the time horizon. Assuming an average annual return of 12%, which is ambitious but feasible for equity mutual funds over the long term, we can proceed with the calculation.

With a corpus of 5 crores already and a goal of 100 crores in 10 years, you'll need to grow your investment by approximately 20 times. This requires an annualized return of around 26%, factoring in the power of compounding.

For simplicity, let's focus on SIP investments. To reach your goal, you may need to invest a substantial amount monthly. However, it's essential to ensure that the investment is within your financial means and risk tolerance.

I recommend consulting with a Certified Financial Planner to create a personalized investment plan tailored to your goals and risk profile. They can help you choose suitable mutual funds and allocate your investments effectively between lump sum and SIP.

Remember, investing involves risks, and past performance is not indicative of future results. Stay committed to your investment plan and review it periodically to make necessary adjustments.

With dedication and prudent planning, you can work towards achieving your financial goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Asked by Anonymous - May 10, 2024Hindi

I have Rs 1lac as savings with me. How do I invest it?

Ans: Investing your savings wisely is crucial for your financial future. With Rs 1 lac, there are various options to consider. Let's assess them:

Firstly, consider your goals. Are you saving for short-term needs or long-term goals like retirement? This will guide your investment choices.

For short-term goals, consider low-risk options like fixed deposits or debt mutual funds. These offer stability and liquidity, ensuring your money is safe and accessible when needed.

For long-term goals, like retirement, you can explore equity mutual funds. They offer the potential for higher returns over the long term, albeit with more volatility. As a Certified Financial Planner, I can guide you in selecting funds aligned with your risk tolerance and goals.

Avoid real estate as it requires substantial capital and has liquidity issues. Additionally, steer clear of index funds, which may not suit your investment preferences.

Regular funds through a Mutual Fund Distributor offer personalized advice and ongoing support, unlike direct funds. This ensures your investments are managed efficiently and adapted to changing market conditions.

Remember, diversification is key to mitigate risks. Spread your investment across different asset classes like equity, debt, and gold to balance risk and returns.

Lastly, stay informed and review your investments regularly to make necessary adjustments.

Investing wisely now can pave the way for a financially secure future. Best of luck on your investment journey!

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Stock Market Expert - Answered on May 10, 2024

Asked by Anonymous - May 10, 2024Hindi

Hello Sir, I want to make Rs.30,000 per month through stock market without loses..What will be the strategy, However, I'm very poor, My savings is 2000 rs. per month...

Ans: please leave this type of thought, this is not possible.

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Stock Market Expert - Answered on May 10, 2024

Asked by Anonymous - Feb 02, 2024Hindi

Dear Sir, IS GTL Infra good buy for 3 years!

Ans: Declining Revenue every quarter for the past 3 quarters
Declining profits every quarter for the past 2 quarters
Declining Net Cash Flow : Companies not able to generate net cash
Annual net profit declining for last 2 years

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Stock Market Expert - Answered on May 10, 2024

Asked by Anonymous - Jan 31, 2024Hindi

Hi Rediff gurus, I have got a few shares via esops from the companies I had earlier worked in. These are all foreign shares and I am aware there is a flat 20% flat if I sell. However, a couple of years ago there was government bond which exempted from tax for 50 lakhs INR per year and investment duration was 3 years. Currently are there any bonds / schemes like that? Also, am I exempted from tax if I sell shares to buy one a residential property? A quick response is much appreciated Thank you

Ans: no bond and no exemption

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Asked by Anonymous - Apr 23, 2024Hindi

I took VRS and my age is 51. I have invested my terminal benefit of nearly 90 lacs mostly in bank FD with monthly payout. I also get monthly pension of Rs. 60000 and rent of Rs 10000. My monthly expense is limited to 40000. My daughter is pursuing MSc and has 3 years to complete. I have recently started SIP for 10000 per month consulting a financial advisor. The funds are Mahindra manulife aggressive hybrid reg growth-3000, Samco flexicap reg G-2000, Whiteoak capital banking financial service reg G-3000, Whiteoak capital largecap reg G-2000. My goal is to make my corpus 2-3 crores in next 10 years.

Ans: Congratulations on your retirement and taking steps towards financial planning for the future. It's wonderful that you have a clear goal in mind and are actively investing to achieve it.

With your terminal benefit invested mainly in bank FDs with monthly payout, along with a steady monthly pension and rental income, you have a reliable income stream to cover your expenses and support your daughter's education.

Starting SIPs in mutual funds is a smart move to grow your wealth over the long term. Your choice of funds reflects a diversified approach, covering different market segments and investment styles. It's essential to monitor the performance of these funds regularly and make adjustments as needed to stay on track towards your financial goals.

Your goal of reaching a corpus of 2-3 crores in the next 10 years is ambitious but achievable with disciplined saving and investing. Given your current investments and income sources, along with your SIP contributions, it's important to ensure that your investment strategy aligns with your risk tolerance and time horizon.

Consider consulting with a Certified Financial Planner to review your overall financial plan, assess your risk profile, and make any necessary adjustments to optimize your investment strategy. They can provide personalized guidance to help you achieve your financial goals while maintaining financial security and peace of mind.

Continue to stay focused on your goals, and with prudent financial management, you can build a substantial corpus for a comfortable and secure future.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Asked by Anonymous - Apr 23, 2024Hindi

Iam 41 years earning 32000 pm and after TDS getting 29484 my dad is giving 15000 and interest on fd for 320000 at 7.75 % and personal interest for loan provided for5 lakh is 17500 fd interest and loan interest varies dad's is temporary have rd investment of total 260000 which matures in August ,2024 ppf 230000 sbi pension investment retire smart plan of 500000 I can either avail pension lifelong or lumpsum return before 25 years completion in another 2 years afterwards at 8.1 interest if pension or if lumpsum the fund value gold and silver and residential property which iam currently living in my expenses are about 10000 or so depends I have lic endowment paid till now for about 7.5 years 50000 pa needed to be paid for another 7.5 years if continued maturity amount will be 12 lakh. In commercial property I will get increment upto every 5 years for about 25 years and at 25th year it will be around 57000 at 66 th year which is fixed and then it would be the rent at that point what is prevailing in that area now I want to know what I need to invest and is it sufficient for my retirement and how much more I should make and salary varies as jobs are not permanent so request to guide as iam interested in travelling and need about 30 lakhs or so for all this starting at this age for about another 5 to 6 years taking about 4 lakhs pa to cover up 1 abroad location

Ans: Given your financial situation and aspirations, it's essential to devise a comprehensive retirement plan that addresses your income, expenses, investments, and retirement goals.

Starting with your income, considering your monthly salary of 29,484 after TDS, along with the additional support from your father and interest income from FDs and loans provided, you have a steady income stream.

Your investments, including RD, PPF, SBI pension investment, LIC endowment, and commercial property, provide a diversified portfolio. However, it's crucial to evaluate each investment's performance, risk, and suitability for your retirement goals.

Regarding your expenses, with an estimated monthly expense of 10,000, it's important to factor in inflation and potential lifestyle changes in retirement. Planning for contingencies and unexpected expenses is prudent.

To assess if your current investments are sufficient for retirement, consider your retirement goals, including travel expenses. With a target of 30 lakhs for travel over the next 5-6 years, it's essential to calculate the required investment amount to achieve this goal within the specified timeframe.

Since your salary varies due to the nature of your job, it's advisable to create a buffer or emergency fund to cover any income fluctuations or unforeseen expenses.

Consulting with a Certified Financial Planner can provide personalized insights and recommendations tailored to your financial situation, retirement goals, and risk tolerance. They can help you optimize your investment strategy, identify potential gaps, and create a roadmap for achieving your retirement aspirations.

Remember, retirement planning is a dynamic process that requires periodic review and adjustments. Stay proactive, monitor your investments, and make informed decisions to ensure a secure and fulfilling retirement.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Asked by Anonymous - Apr 24, 2024Hindi

Hi. I am ready to invest 5-6k per month. I have selected few mutual fund schemes like quant active fund, quant mid cap, icici retirement fund. I am planning this for long term like 5-20 yrs. Kindly help me with the best mutual fund schemes.

Ans: Certainly, selecting the right mutual fund schemes is crucial for achieving your long-term financial goals. Let's evaluate the schemes you've chosen and suggest some additional options:

Quant Active Fund: This fund follows an active investment strategy, aiming to outperform the market by selecting stocks based on quantitative analysis. While active funds can potentially generate higher returns, they also come with higher expense ratios and manager risk. Keep an eye on its performance relative to its benchmark and peers.
Quant Mid Cap Fund: Mid-cap funds invest in companies with medium market capitalization, offering growth potential but with higher risk compared to large-cap funds. Quant Mid Cap Fund's performance may fluctuate with market conditions, so ensure it aligns with your risk tolerance and investment horizon.
ICICI Retirement Fund: Retirement funds are designed to provide a suitable asset allocation based on your retirement age. ICICI Retirement Fund offers different options based on your risk appetite and retirement horizon. Evaluate its suitability based on your retirement goals and risk tolerance.

Considering your long-term investment horizon, it's crucial to maintain a diversified portfolio aligned with your risk tolerance and financial goals. Regular review and rebalancing are essential to adapt to evolving market dynamics.

Remember, investing is a journey, and staying disciplined during market fluctuations is key to long-term success. Keep your focus on your goals, and with careful planning and guidance, you can achieve financial security and peace of mind.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Asked by Anonymous - Apr 23, 2024Hindi

Hello Sir, please review & advise on my mutual fund portfolio. SIP of 5000 each in UTI Nifty 50 index fund, Parag Parikh flexicap, Quant flexi cap & 3000 each in ICICI Midcap 150 index fund & Kotak large 7 midcap fund. All Started since 4 months, current age 42 & can do SIP for 2-3 years & plan to keep the accumulated amount as it is for next 5 years. I have some investments in equity shares(25%), SGB(25%) & FD's(50%) as well. Expecting to retire in next 6-7 years. Thanks

Ans: Your mutual fund portfolio appears to be well-diversified across different categories, offering exposure to large-cap, flexi-cap, and mid-cap segments. Let's delve into some insights and recommendations:
1. UTI Nifty 50 Index Fund: Investing in an index fund tracking the Nifty 50 provides broad exposure to India's top 50 companies. It's a reliable choice for long-term wealth accumulation, especially considering its low expense ratio and consistent performance.
2. Parag Parikh Flexi Cap Fund: This fund follows a flexible investment approach, allowing it to invest across market capitalizations. Its global diversification and focus on quality stocks make it suitable for investors seeking a balanced approach to wealth creation.
3. Quant Flexi Cap Fund: Flexi-cap funds offer the flexibility to invest across market segments based on market conditions. However, Quant Flexi Cap Fund's performance may vary due to its quantitative investment approach. Keep an eye on its performance relative to peers.
4. ICICI Midcap 150 Index Fund: Mid-cap funds have the potential for higher returns but come with increased volatility. Investing in a mid-cap index fund like ICICI Midcap 150 can provide exposure to mid-sized companies while mitigating individual stock risk.
5. Kotak Large & Midcap Fund: This fund combines investments in both large and mid-cap stocks, offering diversification across market segments. It's crucial to monitor the fund's performance and ensure it aligns with your investment objectives.
Active vs. Passive Management:
While you've included both actively managed mutual funds and index funds (ETFs) in your portfolio, it's important to understand the differences between the two. Actively managed funds aim to outperform the market through active stock selection and portfolio management, while index funds passively track a specific index's performance.
Benefits of Actively Managed Funds:
Actively managed funds offer the potential for higher returns compared to index funds, especially during market inefficiencies or when skilled fund managers can identify lucrative investment opportunities. Additionally, active management allows for flexibility in portfolio construction and adjustments based on market conditions.
Potential Disadvantages of Index Funds:
While index funds offer low expense ratios and broad market exposure, they may lack the potential for outperformance compared to actively managed funds. Additionally, they're subject to tracking error, which occurs when the fund's performance deviates from the index it's designed to replicate.
Considering your investment horizon of 2-3 years for SIP and a plan to hold the accumulated amount for the next 5 years, it's essential to review your portfolio periodically. Keep an eye on fund performance, market conditions, and your financial goals to make necessary adjustments.
Given your diversified investment portfolio with equity shares, Sovereign Gold Bonds (SGBs), and Fixed Deposits (FDs), ensure a balanced allocation aligned with your risk tolerance and retirement goals. As you approach retirement in 6-7 years, consider gradually shifting towards more conservative investment options to safeguard capital.
Consulting with a Certified Financial Planner can provide personalized guidance tailored to your financial situation and retirement aspirations.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Question by Geo - Apr 25, 2024Hindi

Hi Advait, I hope you're doing well. I have a question that I think you might be able to assist me with. I'm 52 years old and currently need to plan for my children's education expenses. My elder child's education is ongoing and requires 10 lakhs, while my younger child will require 30 lakhs in two years. Here's a breakdown of my investments: Stocks, Mutual Funds, and Portfolio Management Services amount to 2.6 crores, and I have 40 lakhs in my Provident Fund. I also receive a monthly rent of 2 lakhs. If I estimate my monthly expenses at 1 lakh, do you think I can retire comfortably with this corpus? In the worst-case scenario, I can liquidate one of my properties, which could yield 3 crores. Ideally, I would like to retire without touching my real estate investments. My life expectancy is 85 years. Additionally, I have medical insurance coverage of 12 lakhs plus a top-up of 90 lakhs. I plan to travel twice a year during retirement, with an estimated expenditure of 1.5-2 lakhs per year. I would appreciate your insights on this matter. Thank you, Geo

Ans: Hello Geo, I'm doing well, thank you for asking. It sounds like you have several factors to consider in your retirement planning, especially regarding your children's education expenses and your retirement goals.

With your investments totaling 2.6 crores in stocks, mutual funds, and portfolio management services, along with 40 lakhs in your Provident Fund and a monthly rent of 2 lakhs, you seem to have built a substantial corpus for retirement. Additionally, having the option to liquidate one of your properties for 3 crores provides flexibility in case of unforeseen circumstances.

Considering your monthly expenses of 1 lakh, your retirement income from investments and rental income should comfortably cover your basic needs. Your medical insurance coverage also seems robust, which is crucial for maintaining financial security during retirement.

However, it's essential to account for inflation and potential fluctuations in investment returns. While your current investments may suffice for your retirement needs, periodic reassessment and adjustments may be necessary to ensure your financial security throughout retirement.

Regarding your children's education expenses, it's commendable that you've earmarked funds for their education. By carefully planning the timing and allocation of these expenses, you can minimize the impact on your retirement corpus.

Your estimated travel expenses during retirement are reasonable and can be accommodated within your budget.

Overall, with prudent financial management and careful planning, it seems feasible for you to retire comfortably without touching your real estate investments. However, consulting with a Certified Financial Planner can provide personalized insights and recommendations tailored to your specific financial situation and goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Question by Ganesh - Apr 27, 2024Hindi

Hello Sir Currently I am 34 years old working in software career. My monthly in hand salary is 1.7 L. I have home loan of 39 Lakhs with 8 years tenure and another top up home loan of 5 Lakhs. Also I have 4 Lakhs used car loan. Also I have recently invested Rs 2lakhs in tata motors share @ Rs 960. I am investing in tata AIA fortune plus plan with Rs 12k / month. I have around 7 Lakhs rupees in pf account. My monthy expenses are below - Home Expense - Rs 60k Home loan emi - 60k Home loan top up emi - 10k Other emi - 10k Investment in tata AIA - 12k Please help me to close all these loans and want to retire in age 50 with the 6 lakhs / month on that time. Or 30 cr corpus at age of 50.

Ans: Given your goals of becoming debt-free and retiring comfortably by age 50 with either a monthly income of 6 lakhs or a corpus of 30 crores, it's crucial to devise a strategic financial plan.

Firstly, let's address your loans. With a total outstanding home loan of 44 lakhs and a car loan of 4 lakhs, your monthly EMIs sum up to 140k. Your current monthly expenses are 142k, leaving little room for savings.

Considering your 7 lakhs in the PF account, utilizing a portion of it to reduce your high-interest loans can be beneficial. However, completely depleting your PF may not be advisable due to its impact on retirement savings.

Refinancing your loans to lower interest rates or increasing your income through side hustles could help manage the debt burden. Redirecting a portion of your monthly expenses towards loan repayment can also accelerate the process.

Now, regarding your investments, while Tata AIA Fortune Plus Plan can provide returns, it's essential to ensure that your insurance needs are adequately met separately. Avoid mixing investments with insurance to optimize both aspects.

For retirement planning, achieving a monthly income of 6 lakhs at age 50 or accumulating a corpus of 30 crores necessitates a disciplined approach. You may need to increase your investment contributions substantially and explore diverse investment avenues to achieve such ambitious targets.

Consulting with a Certified Financial Planner can provide personalized guidance tailored to your financial situation and goals. They can help structure a comprehensive financial plan encompassing debt management, investment strategies, and retirement planning.

Remember, achieving financial freedom requires dedication, patience, and informed decision-making. Stay committed to your goals, and with prudent financial management, you can realize your aspirations.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Question by argha - Apr 27, 2024Hindi

I have a home loan pending 11 lacs in 6 yrs and car loan pending 3 lacs, my current saving is 0 and total monthly emi around 35000. Should I draw around 6-7 lacs from epf account and do downpayment ?

Ans: Given your situation, it's understandable to seek ways to manage your loans effectively. Drawing from your EPF account can seem like a tempting option to make a substantial down payment. However, it's crucial to assess the long-term implications before making a decision.

Taking a significant chunk from your EPF can impact your retirement savings. It's like borrowing from your future self. While it may alleviate immediate financial strain, it could compromise your financial security later on.

Consider the interest rates of your home and car loans. If the interest on these loans is higher than what your EPF is earning, it might make sense to prioritize paying off those loans gradually rather than depleting your EPF savings.

Moreover, exhausting your EPF prematurely means missing out on potential compounding growth. This growth could significantly augment your retirement corpus over time.

Exploring alternative strategies to manage your loans, like restructuring your EMIs or increasing your income, could be more sustainable approaches. It might require some adjustments, but it's crucial to protect your long-term financial well-being.

Remember, financial decisions should align with your overall goals and priorities. While it's essential to address immediate concerns, it's equally vital to safeguard your future financial stability.

I encourage you to consult with a Certified Financial Planner to devise a comprehensive financial plan tailored to your needs and aspirations.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Question by VASANT - Apr 24, 2024Hindi

HOW INTEREST IS PAID ON PF IF CLAIM IS MADE AFTER MARCH 2024? BROKEN PERIOD INTEREST HOW CREDITED AT THE TIME OF CLAIM APRROVAL?

Ans: Here's how interest is applied on your PF if you claim it after March 2024:

Interest Rate:

The interest rate for the financial year 2023-24 (ending March 2024) has been declared as 8.25%. This will be applied to your PF balance until March 31st, 2024.
Broken Period Interest:

Interest for the period after March 2024 will be credited at a rate notified by the EPFO (Employees' Provident Fund Organisation) for that specific period. This rate is usually lower than the declared annual rate.
The EPFO typically announces the interest rate for the broken period later in the year.
Crediting Interest at Claim Approval:

When your PF claim is approved, the interest for the financial year 2023-24 (8.25%) will be automatically calculated and credited to your account.
The broken period interest will also be calculated based on the notified rate and credited at the time of claim settlement.
Here are some resources for further information:

The EPFO website might not have the latest broken period interest rate yet, but you can check for updates on their official site: https://www.epfindia.gov.in/
I hope this clarifies how interest is handled on PF claims made after March 2024.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Asked by Anonymous - Apr 24, 2024Hindi

Hi, I have another 5 years to reach retirement. I have my own house, a plot worth Rs.50 Lakhs, 1 crore in Fixed Deposit, Rs.500,000 invested in mutual fund. I have no loans and my present savings per month is Rs.225,000 tax free. I have a wife and two sons. One son is settled and another son is still in college level. Want to know how much more funds are required to lead a decent retired life after 5 years. I am physically fit to work for another 10 years.

Ans: It's great to hear about your proactive approach towards retirement planning. Let's assess your current financial position and estimate the funds required for a comfortable retired life after 5 years:
1. Existing Assets:
• Own house and a plot worth Rs. 50 lakhs: These assets provide stability and potential for appreciation over time.
• Fixed Deposit of 1 crore: Offers liquidity and stability in your portfolio.
• Mutual fund investment of Rs. 5 lakhs: Provides diversification and growth potential.
2. Monthly Savings:
• Your tax-free savings of Rs. 2,25,000 per month are impressive and will contribute significantly towards building your retirement corpus.
3. Future Expenses:
• Consider your anticipated expenses post-retirement, including living expenses, healthcare, travel, and other leisure activities.
• Estimate your children's education and marriage expenses if any.
4. Income Sources in Retirement:
• Assess your expected income sources in retirement, such as pension, rental income, interest from investments, and any other sources.
5. Gap Analysis:
• Calculate the shortfall between your estimated expenses in retirement and your expected income sources.
• Determine how much additional funds you need to bridge this gap.
Given your current financial assets, monthly savings, and future income sources, it seems you're well-positioned for a comfortable retired life. However, it's essential to consider inflation and potential healthcare expenses in retirement.
As a Certified Financial Planner, I recommend consulting with a professional to conduct a detailed analysis of your retirement needs and develop a customized financial plan. They can help you determine the additional funds required and suggest suitable investment strategies to achieve your retirement goals.
By continuing your disciplined savings approach and investing wisely, you can ensure a financially secure and fulfilling retired life for you and your family.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Question by K - Apr 27, 2024Hindi

My returns from MFs during last 7-8 years have been about 10% CAGR. Does it make sense to shift to 2-3 ELSS funds by SIP in next 3-5 years?

Ans: It's impressive to hear about your consistent returns from mutual funds over the past several years. A 10% CAGR is indeed a commendable achievement and reflects your prudent investment decisions.

Considering your investment horizon of 3-5 years, shifting to 2-3 ELSS funds by SIP can be a strategic move. Here's an evaluation of this approach:

• ELSS funds offer the dual benefit of tax savings under Section 80C and potential wealth creation through equity investments.
• By diversifying your portfolio across multiple ELSS funds, you can spread your risk and potentially enhance your returns.
• SIPs in ELSS funds allow you to invest systematically, taking advantage of rupee-cost averaging and reducing the impact of market volatility.

However, it's essential to consider a few factors before making this shift:
• ELSS funds have a lock-in period of 3 years, which may affect liquidity if you need to access funds before that period.
• Ensure that ELSS funds align with your risk tolerance and investment objectives. They predominantly invest in equities, which can be volatile in the short term.

As a Certified Financial Planner, I recommend conducting a comprehensive review of your financial goals, risk tolerance, and investment strategy before making any changes to your portfolio. Seek professional advice to ensure that your investment decisions are in line with your overall financial plan.

Remember, the key to successful investing is to stay informed, stay disciplined, and seek guidance when needed.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Question by Antony - May 04, 2024Hindi

Hi, I have to create a corpus of 2 cr for my kids education in 5 years. What is your advise on investments, including MF, Equities, and other schemes pls ?

Ans: It's great that you're planning ahead for your kids' education. Achieving a corpus of 2 crores in 5 years requires a disciplined investment approach with a focus on growth potential and risk management. Here's some advice on suitable investment avenues:

Equities: Investing in equities can offer higher returns over the long term. Consider allocating a portion of your investment towards well-researched stocks or equity mutual funds. While equities come with volatility, they have the potential to outperform other asset classes.
Mutual Funds: Mutual funds provide diversification and professional management, making them a popular choice for goal-based investing. Opt for a mix of equity and debt mutual funds based on your risk tolerance and investment horizon. Equity funds can offer growth potential, while debt funds provide stability.
Systematic Investment Plan (SIP): SIPs allow you to invest regularly in mutual funds, helping you benefit from rupee-cost averaging and reduce the impact of market volatility. Start SIPs in suitable mutual funds to gradually build your corpus over the next 5 years.
Debt Instruments: Considering the short investment horizon, include debt instruments like fixed deposits, debt mutual funds, or short-term debt funds in your portfolio. These instruments offer stability and capital preservation, which is essential when your goal is nearing.
Regular Review and Rebalancing: Periodically review your investments to ensure they are aligned with your goal of creating a 2 crore corpus for your kids' education. Rebalance your portfolio as needed to maintain the desired asset allocation and risk level.
It's crucial to consult with a Certified Financial Planner to create a personalized investment plan tailored to your financial goals, risk tolerance, and investment horizon. They can help you make informed decisions and navigate the complexities of the market.

By adopting a diversified and disciplined investment strategy, you can work towards achieving your goal of funding your kids' education with a 2 crore corpus in 5 years.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Asked by Anonymous - May 04, 2024Hindi

I am 55 years old and plan to retire at 60. My current expenses are around 2L per month. How much corpus do I need to have a 30 years of retired life with same lifestyle ?

Ans: It's fantastic that you're planning for your retirement. Starting to think about it at 55 shows foresight and responsibility.

Understanding how much you'll need for a comfortable retired life is crucial. We'll evaluate your current expenses and projected lifestyle to estimate your retirement corpus.

Your current monthly expenses of 2 lakhs are a good starting point. Considering inflation, we'll project how much you'll need at retirement.

Based on a conservative estimate of a 6% inflation rate, your expenses could double every 12 years. So, after 5 years, your expenses might be around 41 lakhs annually.

To maintain this lifestyle for 30 years of retirement, we estimate a corpus of approximately 12.3 crores.

This estimation doesn't include investment returns or taxes, so it's wise to consult with a Certified Financial Planner for a detailed analysis.

By diligently saving and investing, you can work towards building the required corpus for a worry-free retirement. Keep up the good work!

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Asked by Anonymous - May 04, 2024Hindi

Sir/Madam I'm 35 Years Old Salaried person I'm currently Investing Rs.30,000/- in Mutual Fund from 2017 Portfolio Value Is Rs.21,00,000/- and My Investment is 12,80,000/- Want To Continue For 10 Years.. 10% step-up in every 2 Years 1.SBI SMALL CAP 2.PARAG PAREKH FLEXI CAP 3.NIPPON SMALL CAP 4. DSP MID CAP 5.SBI INTERNATIONAL FUND 6.MOTILAL OSWAL TAX SAVING 7.AXIS NEXT 50 INDEX FUND

Ans: It's commendable that you've been investing systematically in mutual funds since 2017 and have built a substantial portfolio. Your strategy of continuing for another 10 years with a 10% step-up every 2 years reflects a disciplined approach towards wealth creation.
Let's review your current portfolio and make some suggestions:
1. SBI Small Cap, Nippon Small Cap, DSP Mid Cap: Small and mid-cap funds have the potential for high growth but come with higher volatility. Since you're looking at a long-term horizon, these can be suitable for wealth accumulation. However, monitor their performance closely and be prepared for fluctuations.
2. Parag Parikh Flexi Cap, SBI International Fund, Motilal Oswal Tax Saving: These funds offer diversification across market caps and geographies, which is beneficial for risk management. Parag Parikh Flexi Cap, in particular, follows a flexible approach and invests in a mix of equity, debt, and international stocks, providing stability.
3. Axis Next 50 Index Fund: Index funds offer low-cost exposure to a basket of stocks mirroring a particular index. While they provide diversification, they may lack the potential for outperformance compared to actively managed funds. However, they can be a valuable addition to your portfolio for passive investing.
Considering your investment horizon and the step-up strategy, you can continue investing in these funds with periodic reviews. It's essential to rebalance your portfolio periodically to ensure alignment with your goals and risk tolerance.
Given the significant portfolio value, it's advisable to seek advice from a Certified Financial Planner who can provide personalized guidance tailored to your financial objectives, risk appetite, and tax considerations.
Keep up the good work of systematic investing, and with a well-diversified portfolio, you're on track to achieve your long-term financial goals.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

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Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Question by Shriprakash - May 04, 2024Hindi

Sir, Myself 31 yr married and a working professional in Pvt sector with an emergency Corpus of 1,50,000 which would be okay for me till 4-6 months. I already have term insurance of 1 cr and health insurance for my family. I want to seek advice on investment. I have still not started any investment in stocks or MF. My financial goals are as below: Short term : 1. Car under 10 lac after 6 - 7 years 2. House (2bhk) in 10-12 years (i already stay at our parents own house so not in a hurry to purchase my own house) Long term : 1. Child education after 17 years with a Corpus of 20-25 lacs 2. Child marriage after 22 years with a Corpus of 25-30 lacs 3. Retirement after 25 years with a Corpus of 1 cr. My current salary is 50k in hand. Pls suggest.

Ans: Given your financial goals and current situation, it's great to see that you've already established an emergency corpus and have adequate insurance coverage. Now, let's focus on your investment strategy to achieve your goals.

For your short-term goals like buying a car and a house, which are 6-12 years away, consider investing in a mix of equity and debt instruments. Equity mutual funds can provide the potential for higher returns over the long term, which aligns well with your time horizon. Debt instruments like fixed deposits or debt mutual funds can offer stability for your shorter-term goals.

For your long-term goals, such as your child's education, marriage, and your retirement, you can afford to take more risk and invest primarily in equity mutual funds. These investments have the potential to generate higher returns over a longer period, helping you build the required corpus.

Since you're new to investing in stocks or mutual funds, it's advisable to start with systematic investment plans (SIPs). SIPs allow you to invest regularly in mutual funds, helping you benefit from rupee-cost averaging and reducing the impact of market volatility.

Considering your current salary of 50k in hand, assess your monthly surplus after meeting your expenses and allocate a portion towards SIPs for each of your goals. A Certified Financial Planner can assist you in creating a customized investment plan tailored to your goals, risk tolerance, and financial situation.

Remember to review your investments periodically and make adjustments as needed to stay on track towards achieving your financial goals. With discipline and patience, you can build a solid foundation for your future financial security.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Ramalingam Kalirajan |1896 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Asked by Anonymous - May 05, 2024Hindi

Hi Mr. Ramalingam, As a regular reader of Ask Now I have seen your responses to almost all the requested advices you have a generic answer having 3-4 pointers for all the ask. I know it's difficult to advice any on the basis of very few details. Though I feel these generic responses are not serving the purpose of this column. If every answer suggesting the way to a financial planer then what is the need of this column.Why we are asking here?

Ans: I appreciate your feedback and concerns. You're absolutely right that each individual's financial situation is unique, and providing personalized advice based on limited information can be challenging. However, the aim of this column is to offer guidance and insights into financial planning principles and strategies.

While the responses may seem generic at times, they are intended to provide a foundational understanding of financial planning concepts and best practices. Additionally, I aim to highlight the importance of seeking professional advice from Certified Financial Planners to tailor a plan specific to one's needs and circumstances.

The purpose of this platform is to foster discussions around financial matters and empower individuals with knowledge to make informed decisions. While I strive to offer valuable insights within the limitations of this format, I encourage readers to seek personalized advice for their specific situations.

Your feedback is valuable, and I'll endeavor to provide more nuanced responses where possible while maintaining the educational focus of this column.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Ramalingam Kalirajan |1896 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Asked by Anonymous - May 05, 2024Hindi

I am 34 years and plan to accumulate 2 crs in next 15 years. Now Please advice me which funds to invest and How much amount to invest ?

Ans: Certainly, planning for a corpus of 2 crores in 15 years is an ambitious yet achievable goal. At 34, you have a good time horizon to pursue growth-oriented investments while balancing risk.

To start, consider allocating your investments across a mix of equity and debt instruments. Equity mutual funds typically offer higher growth potential over the long term, albeit with greater volatility. Debt instruments provide stability and capital preservation.

Given your time horizon, you can afford to take some risk in your portfolio. Equity mutual funds, especially diversified equity funds or large-cap funds, can be a suitable choice for wealth accumulation over the long term. These funds invest in stocks of companies with a track record of stable performance, potentially offering steady growth.

For the debt component of your portfolio, consider options like debt mutual funds or fixed-income instruments such as bonds or fixed deposits. These provide stability and can act as a cushion during market downturns.

As for the amount to invest, it depends on factors like your current savings, monthly surplus, and risk tolerance. A Certified Financial Planner can help you assess your financial situation holistically and determine a suitable investment strategy tailored to your goals.

Avoiding direct investment without professional guidance is prudent, as it can expose you to unnecessary risks and complexities. Regular funds, invested through a Mutual Fund Distributor with CFP credential, offer the benefit of expert advice and ongoing portfolio management.

Consistency in investing and staying invested for the long term is crucial. Review your portfolio periodically and make adjustments as needed to stay on track towards your goal.

By adopting a disciplined and diversified approach to investing, you can work towards accumulating the desired corpus of 2 crores over the next 15 years.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Ramalingam Kalirajan |1896 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Asked by Anonymous - May 04, 2024Hindi

I am a software engineer working from last 10 months currently earning 90k per month. How should i save to buy house in the next 3-4 years. My monthly expenses are around 30K. I am doing an SIP of 10k in parag parikh elss tax saver fund for 80C deductions. How should i invest remaining money for my house goal. Considering my father is also working and i will get some support from father.

Ans: To begin, congratulations on your diligent efforts as a software engineer and your commitment to planning for your future. It's commendable that you're thinking ahead about homeownership and seeking advice on financial planning.

Given your current situation, with a steady income and manageable expenses, you're in a good position to save for your house goal. Your SIP in a tax-saving fund is a wise move for optimizing your taxes while also working towards your goal.

Considering a time horizon of 3-4 years, it's essential to balance growth potential with risk. While your father's support is valuable, it's prudent to plan primarily based on your own resources.

For the remaining funds, you might consider a diversified investment approach. Since you've already utilized the 80C benefit, explore other avenues like mutual funds, debt instruments, or balanced funds. These can offer a mix of growth and stability, aligning with your medium-term goal.

Be cautious about direct investments without professional guidance. Working with a Certified Financial Planner can provide personalized advice and help navigate the complexities of the market, maximizing returns while minimizing risks.

Avoiding real estate as an investment option is wise, given its illiquidity and potential volatility. Instead, focus on liquid assets that offer flexibility and easier access to funds when needed.

Remember, consistency is key. Continue to monitor your investments regularly, adjusting them as needed based on market conditions and your evolving financial situation.

Your proactive approach to financial planning sets a strong foundation for achieving your homeownership goal. Keep up the disciplined saving and investing, and you'll be closer to realizing your dream.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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Ramalingam Kalirajan |1896 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on May 10, 2024

Asked by Anonymous - May 05, 2024Hindi

I am 42 yrs now. I have flat with a market value of about 70 lakhs with 10 lakh running home loan. I have in hand salary of 1.4 lakh. I am looking to buy a new flat for Rs 85 lakh. Should I take a new loan or think about selling my old flat and buying the new one without home loan ?

Ans: Considering your situation, it's essential to weigh the pros and cons of taking a new loan versus selling your old flat to fund the purchase of the new one.

Selling your old flat and buying the new one without a home loan can offer financial freedom and peace of mind. You'll eliminate the burden of monthly loan payments and potentially save on interest costs over the long term.

However, selling your current flat may incur additional expenses such as brokerage fees, taxes, and other transaction costs. You'll also need to ensure that you have sufficient funds from the sale to cover the entire cost of the new flat.

On the other hand, taking a new loan for the new flat allows you to preserve your liquidity and retain ownership of your current flat. You can benefit from tax deductions on home loan interest payments and spread the cost of the new flat over a more extended period.

However, it's crucial to assess your ability to manage two home loan EMIs simultaneously and ensure that it doesn't strain your financial resources. Consider factors such as your income stability, future financial goals, and overall debt burden before opting for a new loan.

Ultimately, the decision depends on your financial objectives, risk tolerance, and personal preferences. A Certified Financial Planner (CFP) can help you evaluate the pros and cons in detail and develop a customized strategy that aligns with your long-term financial goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

(more)

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