Myself: FD-5 lakhs, Stocks-1.5L, MF-3.7L, EPF-1.6L. I do 15K SIP in MF and 5K SIP in stocks every month.
Spouse: FD- 10L, MF SIP-10K monthly.
We both have an active RD of 10K per month and health insurance of 2L each (in addition to 2L provided for each by my company). We together earn 1.8L monthly. Housing loan EMI of 55K monthly to be paid for next 10 years. We also have life insurance cover.
We both are 30 yrs old with no kids as of now. How can we plan our investments? Are our SIPs enough for a target corpus of atleast 3 crore for retirement and child's future?Is the health insurance cover adequate?
Ans: Your financial discipline is already strong at this early stage.
But reaching a Rs 3 crore goal needs structured planning.
Let’s assess your situation from a 360-degree view.
Analysing Your Current Financial Strength
You both earn Rs 1.8 lakh monthly, which gives good saving capacity.
You already have health insurance, life cover, and housing loan under control.
Your current assets: Rs 5 lakh FD, Rs 1.5 lakh stocks, Rs 3.7 lakh MF, Rs 1.6 lakh EPF.
Your spouse holds Rs 10 lakh FD and invests in mutual funds through SIP.
Your total investable corpus is still in the early growth stage.
Your existing SIPs: Rs 15,000 MF + Rs 5,000 stocks (you) and Rs 10,000 MF (spouse).
Both of you are 30 years old, which gives nearly 30 years to retirement.
Reviewing the Adequacy of Current SIPs
A Rs 3 crore goal needs steady and growing SIPs.
Your combined monthly SIP is Rs 25,000 plus RDs of Rs 10,000 monthly.
RD gives low growth. Shifting this amount to equity SIP can boost growth.
SIPs need to grow 10% yearly to beat inflation and reach Rs 3 crore.
With 25–30 years of investing, you are on the right path.
But if you pause SIPs, your goals may be delayed.
Regularly review SIP amounts with your Certified Financial Planner.
Optimising Your Existing Investments
Mutual funds must be actively managed, not index funds.
Index funds lack human intervention during market volatility.
They copy the market but do not protect from market falls.
Active mutual funds provide better growth with sector rotation.
Invest through regular plans with an MFD and Certified Financial Planner.
Direct plans lack review, adjustments, and timely rebalancing.
Regular plans give ongoing market insights and guidance.
Shift stocks SIP into equity mutual funds unless you actively track markets.
Stocks carry single-company risk which mutual funds avoid.
Keep FD for emergency fund, not for long-term growth.
EPF will grow slowly but gives safety. Continue contributing.
Assessing the Adequacy of Health Insurance
You have 2 lakh personal and 2 lakh employer health cover each.
This is low for today’s healthcare costs.
Take an additional Rs 10–15 lakh family floater cover.
Family floater protects both of you and your future child.
Rising medical inflation can wipe your savings without insurance.
Don't rely only on employer insurance, it may stop if you leave the job.
Life Insurance Assessment
You mentioned life insurance but not the sum assured.
Ideally, life cover should be 15–20 times your annual income.
Both of you should have separate term plans.
ULIPs or insurance-cum-investment policies are not recommended.
If you have LIC or ULIPs, surrender and shift the money to mutual funds.
Housing Loan EMI and Its Impact
Rs 55,000 EMI is a large portion of your income.
This limits your saving capacity temporarily.
Once the loan is repaid, channel EMI amount into SIPs.
Prepayment is good but should not stop your equity investments.
Balance loan repayment and wealth creation for best results.
Building a Child’s Future Corpus
Plan for child’s higher education and marriage now.
Start a separate mutual fund SIP for this goal.
Begin with Rs 5,000–7,000 monthly for child’s corpus.
Increase it yearly by 10% to cover education inflation.
Do not rely on RDs or FDs for child’s future. Growth will be low.
Equity mutual funds will give better returns over 15–20 years.
Keep the investment flexible, goal-based, and monitored.
Emergency Fund Readiness
Your combined FDs of Rs 15 lakh seem sufficient.
This equals around 7–8 months of household expenses.
Keep Rs 6–9 lakh in liquid or ultra short-term funds.
Use the balance FD amounts towards better-returning investments.
Don’t withdraw the emergency fund for vacations or luxury expenses.
Optimising Your RD Investments
RDs have low post-tax returns, barely beating inflation.
Shift RD amounts to equity mutual fund SIPs.
This will improve wealth creation over the next 20–30 years.
Keep RDs only if you need a lump sum in 2–3 years.
Otherwise, long-term goals should be in equity mutual funds.
Recommended Monthly Investment Allocation
Rs 15,000 equity mutual fund SIP (continue).
Rs 10,000 spouse mutual fund SIP (continue).
Shift Rs 10,000 RD to equity SIP gradually.
Stocks SIP of Rs 5,000 – shift slowly to equity mutual funds.
Add Rs 5,000 child-focused SIP for future education.
This totals Rs 40,000–45,000 monthly in equity mutual funds.
Increase SIPs by 10% every year with income growth.
After home loan closure, direct Rs 55,000 EMI to SIPs.
Practical Retirement Planning Insights
Start planning retirement corpus today.
Do not postpone it till your 40s.
Keep separate SIPs for retirement and child’s future.
Aim for Rs 2 crore–2.5 crore for retirement alone.
Child’s education and marriage corpus of Rs 50 lakh–1 crore needed.
Retirement funds should grow through equity mutual funds.
Avoid mixing retirement and short-term goals.
NPS can be an optional tool but keep primary focus on mutual funds.
Taxation Insights on Mutual Funds
Equity mutual funds attract 12.5% LTCG beyond Rs 1.25 lakh yearly gains.
STCG within one year is taxed at 20%.
Debt mutual funds are taxed as per your slab.
Plan your redemptions carefully to save taxes.
Certified Financial Planners help with tax optimisation.
Recommended Portfolio Composition
Equity mutual funds: 60%–65%.
Debt funds (short-term, liquid): 10%–15%.
Gold mutual funds: 10%.
Emergency fund: 10%–15%.
Stocks: limit to 5% or shift into mutual funds.
No real estate investment for now. Housing loan is enough.
No annuities recommended, as they lock your money.
Regular Portfolio Monitoring is Critical
Review your investments every 6 months.
Adjust your SIPs and goals regularly.
Do not stop SIPs during market corrections.
A Certified Financial Planner will guide you during tough markets.
They help with goal tracking, tax planning, and rebalancing.
Regular plans through an MFD with CFP credential give you this support.
Lifestyle Planning with Child in Mind
Child expenses will rise significantly after birth.
Your current surplus will reduce for 5–7 years.
Plan now to lock in higher SIPs before your child arrives.
Avoid luxury spends that delay wealth creation.
Focus on core goals like child’s education and retirement.
How to Strengthen Your Health Insurance Further
Increase to Rs 10–15 lakh family floater health cover.
Add a Rs 25 lakh critical illness plan for both.
Reassess insurance every 3 years.
Health inflation is rising faster than income growth.
Protect your wealth from hospitalisation risks.
Steps for Future Financial Stability
Increase SIPs every year as your salary rises.
Use bonuses to repay the loan or boost SIPs.
Avoid personal loans and credit card debt.
Stay invested for 20–30 years in equity mutual funds.
Let compounding work in your favour over decades.
Use regular plans with MFD and CFP to review and optimise.
Final Insights
You and your spouse are taking smart financial steps at 30.
Your SIPs are a great start but need yearly upgrades.
Shift RDs and stocks SIPs to mutual funds for better long-term growth.
Increase health insurance cover to protect your family’s future.
Focus on equity mutual funds through regular plans, not index or direct funds.
Certified Financial Planners give personalised advice and regular review.
Avoid real estate and annuities as they block your liquidity.
Your Rs 3 crore goal is realistic with steady, disciplined investing.
Stay consistent with SIPs, review every 6 months, and protect your wealth.
Your family’s future will be secure with these clear, simple steps.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment