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Should I choose colleges like Sri Sivasubramanya Nagar or PSG Tech outside of Bangalore despite being a BMS College student?

Patrick

Patrick Dsouza  |840 Answers  |Ask -

CAT, XAT, CMAT, CET Expert - Answered on Nov 06, 2024

Patrick Dsouza is the founder of Patrick100.
Along with his wife, Rochelle, he trains students for competitive management entrance exams such as the Common Admission Test, the Xavier Aptitude Test, Common Management Admission Test and the Common Entrance Test.
They also train students for group discussions and interviews.
Patrick has scored in the 100 percentile six times in CAT. He achieved the first rank in XAT twice, in CET thrice and once in the Narsee Monjee Management Aptitude Test.
Apart from coaching students for MBA exams, Patrick and Rochelle have trained aspirants from the IIMs, the Jamnalal Bajaj Institute of Management Studies and the S P Jain Institute of Management Studies and Research for campus placements.
Patrick has been a panellist on the group discussion and panel interview rounds for some of the top management colleges in Mumbai.
He has graduated in mechanical engineering from the Motilal Nehru National Institute of Technology, Allahabad. He has completed his masters in management from the Jamnalal Bajaj Institute of Management Studies, Mumbai.... more
Ashwin Question by Ashwin on Nov 05, 2024Hindi
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Career

Sir bmsce has total 1800 cse and cse related course strength so can we choose Chennai college like Sri sivasubramanya nagar college or psg tech even though it’s outside Bangalore For better placement

Ans: Yes. Check where placements are better and take up admission out there. Talk to students of the college to get idea about placements.
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Ramalingam Kalirajan  |6973 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Nov 06, 2024

Asked by Anonymous - Nov 05, 2024Hindi
Money
Hi my age is 28 I would like be to be financially independent after 20 years own a home of 50 lakh. Currently my income is 5 lakh per annum
Ans: Congratulations on setting ambitious goals for financial independence and home ownership. At 28 years, you have ample time to achieve these dreams. Earning Rs 5 lakh per annum currently, you’ll need a well-rounded, disciplined strategy. Let’s create a plan focused on stability, growth, and careful asset building.

1. Financial Independence: Setting a Strong Foundation
Begin with a structured plan. Prioritize investments with growth potential to build a future corpus.

Regular, small investments create compounding benefits. Even small SIPs grow wealth over 20 years.

A Certified Financial Planner (CFP) can guide you. They ensure you meet your milestones.

2. Emergency Fund and Insurance: Ensuring Financial Safety
Keep an emergency fund. Save 6 to 9 months of expenses in a safe, liquid asset.

Health insurance protects against unexpected medical costs. Consider a family floater health policy for broader coverage.

Life insurance secures family finances. Opt for a term policy, ideally 10–15 times your annual income.

3. Mutual Funds: Core Investment Strategy
Actively managed mutual funds can grow wealth over the years. These funds are managed by experts who optimize returns.

Actively managed funds have the flexibility to outperform the market. Index funds lack this adaptability and may fall short in dynamic markets.

Regular fund investments via a CFP offer the added benefit of expert advice. This guidance helps navigate changes over time.

4. Balanced Portfolio: Equity and Debt Allocation
Equity Mutual Funds: Over 20 years, equity mutual funds provide high growth potential. Large-cap and multi-cap funds offer stability with growth.

Debt Funds: Debt mutual funds add balance. They’re less volatile than equity and bring stability to your portfolio.

Regularly review this allocation. Equity-heavy portfolios work best early on, gradually shifting to debt as you near your goals.

5. Goal-Linked Investing: Achieving Financial Independence and Home Purchase
Define two key goals: financial independence and buying a home.

Financial Independence Goal: Plan a corpus that generates passive income covering monthly expenses. Equity mutual funds are ideal for long-term growth towards this goal.

Home Purchase Goal: In 20 years, property prices could rise. Aim to invest in assets growing faster than inflation. Avoid real estate investment directly; mutual funds with high returns will suffice.

6. Power of Systematic Investment Plans (SIPs)
SIPs create disciplined saving habits. They spread investments, lowering market volatility impact.

Over 20 years, SIPs benefit from market cycles. Downturns offer buying opportunities; upturns boost value.

Review your SIP contributions yearly. Increase them as your income grows to boost your wealth accumulation.

7. NPS and PPF: Adding Stability to Your Portfolio
National Pension System (NPS) offers market-linked retirement savings with tax benefits. Partial equity exposure in NPS provides growth without full equity risk.

Public Provident Fund (PPF) is stable, tax-efficient, and safe. With 15-year maturity, it can complement your other assets.

Together, NPS and PPF provide stability. They ensure growth even during market downturns.

8. Avoiding High-Risk Investments
Direct stock investments require active management and market expertise. They’re volatile and may disrupt portfolio stability.

Real estate, while lucrative, requires high capital and often lacks liquidity. Maintenance, taxes, and other factors make it complex.

An actively managed mutual fund approach provides both flexibility and control. It aligns well with your financial independence goal.

9. Tax-Efficient Investment Approach
For equity mutual funds, long-term capital gains over Rs 1.25 lakh are taxed at 12.5%. Plan withdrawals wisely to manage tax impact.

Debt mutual funds are taxed based on your income slab. A balanced portfolio mitigates tax impact across various assets.

Work with a CFP to time withdrawals and reinvestments for maximum tax efficiency. Proper planning reduces tax obligations, optimizing returns.

10. Systematic Transfer Plans (STP) for Rebalancing
As your portfolio grows, shift from equity to debt for stability. Systematic Transfer Plans (STPs) are helpful here.

Move from equity funds to debt funds slowly. This shields your investments from sudden market shifts.

STPs help reduce tax impact and maintain a balanced portfolio. Your CFP can assist in structuring this transition effectively.

11. Investment Tracking and Regular Reviews
Track investments annually to assess performance and adjust as necessary.

Market conditions and life changes may impact your goals. A CFP can guide you to adjust strategies.

Regular reviews ensure investments stay aligned with both your financial independence and home-buying goals.

12. Managing Investment Risk Over Time
Long-term investment requires balancing returns with risk. Equity exposure is ideal early on, tapering as you near your goals.

Debt and equity balance reduces exposure to market volatility. It adds predictability, especially nearing your 20-year goal.

Your CFP can recommend adjustments based on age, life stage, and market conditions.

13. Lifestyle Budget and Expense Planning
Plan a budget that aligns with your income and goals. Track expenses to allocate more towards savings and investments.

Avoid lifestyle inflation as your income rises. This discipline boosts your long-term savings.

An expense budget ensures funds are prioritized towards your larger financial independence and home ownership goals.

14. Managing Debt and Building a Credit Score
Avoid high-interest loans like personal loans or credit card debt. They erode wealth accumulation.

Build a strong credit score by managing debt responsibly. It ensures better loan options if needed in the future.

Minimal debt leaves more income for investments, accelerating your journey to financial independence.

15. Final Insights: Path to Financial Freedom
You’re on the right track, setting specific goals for financial independence and home ownership. With 20 years, time is your ally for compounding and wealth growth.

Focus on actively managed mutual funds over direct stocks or index funds. These offer professional management and adaptability to market changes.

Structured financial planning, consistent reviews, and disciplined investing ensure you meet your goals comfortably.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment

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Ramalingam

Ramalingam Kalirajan  |6973 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Nov 06, 2024

Money
Hello Sir, I am 44 and my wife is 41 and we are both working in the software industry and have a 10 year old daughter. We like a comfortable life and have taken home salaries of 3.5 L and 3 L per month respectively. Last year we have paid off all loans and are EMI free now. Our current asset position is as follows Real Estate Flat 1 - 1.7 CR Falt 2 - 80 L which is rented out and fetches a rent of 20K Villa Plot 1 - Approx 2 CR Volla Plot 2 - Approx 40 L Our Financial assets are PF - 1.1 CR PPF - 20 L NPS - 20 L Sukanya Samrithi - 10 L Mutual funds - 50 L Bonds & Structured Products - 25 L Bank balance / FD's - 25 L Shares / Options / RSU's ($80000) - ~65L Gold (physical & Digital) - ~1.5 CR Some Unlisted Shares - 6L Some LIC's - 6L Crypto - 7 L We have 2 good Cars which is fully paid off. Our ancestral inheritance would be roughly 7-8 CR’s. We have monthly investments of Mutual Fund SIP's - 2 L ,Bank RD'S - 1.2 L PF (take home salary is after taking out PF) - 1 L PPF - 25000 NPS - 60000 (take home salary is after taking out NPS) Sukanya Samrithi - 12500 We pay 5L per year for next 10 years for pension scheme which will give a pension of 35 K for next 35 years and the insured amount back on maturity. We have sufficient term as well as health insurance (over the corporate insurance). Current monthly expenses are around 1.7 L and typically take an international vacation every year. There is lot of uncertainty in the IT industry and would like to understand how to invest smartly and retire early.
Ans: It’s commendable to see your financial success and structured investment approach, especially as both of you work in the demanding software industry. Your significant asset base, debt-free status, and disciplined investment strategy set a solid foundation for early retirement. Given the uncertainties in the IT sector, it’s crucial to structure your investments thoughtfully, focusing on capital growth, liquidity, and passive income to support a comfortable life for years to come.

Let's dive into a 360-degree solution to help you retire early with a sustained, smart investment approach that complements your current lifestyle and aspirations.

1. Income and Investment Strategy for Wealth Growth
Current Income & Cash Flow: Your combined monthly take-home of Rs 6.5 Lakh is robust. It supports your lifestyle expenses and allows significant savings towards your investment goals.

Monthly Investments: Your current monthly investment outlay of Rs 4.75 Lakh (including Mutual Funds, Bank RDs, PF, PPF, NPS, and Sukanya Samrithi Yojana) reflects strong financial discipline. This diversified investment approach is ideal for creating a balanced portfolio.

Next Steps: Given your goal of early retirement, consider redirecting your Bank Recurring Deposits (RDs) towards higher-yielding assets like mutual funds. RDs provide fixed returns but are limited in their potential to outpace inflation, making them less ideal for wealth accumulation over the long term.

2. Real Estate Holdings and Passive Income
Existing Real Estate Assets: You hold significant real estate assets, including two flats and two villa plots. With one flat rented out, you’re generating a monthly rental income of Rs 20,000.

Strategy for Real Estate: While real estate offers a stable asset base, it tends to lack liquidity. This can be a disadvantage if you need access to funds during economic downturns or other emergencies. Instead of increasing real estate investments, consider focusing on instruments that offer higher liquidity and predictable returns. Retain your current properties, but avoid new real estate purchases to maintain a well-rounded, diversified portfolio.

3. Mutual Funds for Long-Term Growth and Capital Appreciation
Current Mutual Fund Portfolio: With Rs 50 Lakh invested in mutual funds and a healthy Rs 2 Lakh monthly SIP, your mutual fund strategy provides a strong foundation for growth. Since mutual funds offer higher returns than traditional deposits and are tax-efficient, they suit your long-term goals well.

Active vs. Index Funds: Active funds are highly recommended over index funds, especially for long-term investors like yourself. Active funds are managed by expert fund managers who actively select stocks to achieve higher returns. Regular review and professional fund management make actively managed funds adaptable to changing market dynamics, offering a better return profile.

Actionable Plan: Consider diversifying within mutual funds across large-cap, mid-cap, and multi-cap categories. Large-cap funds offer stability, mid-cap funds add growth potential, and multi-cap funds provide a balanced approach. Review fund performance yearly with a Certified Financial Planner (CFP) to adjust allocations as needed. A balanced, actively managed mutual fund portfolio can be a key driver toward your financial goals.

4. Substitute Equity Exposure with Equity Mutual Funds
Transition from Direct Equity to Equity Mutual Funds: Given the volatile nature of direct stock investments, you may want to focus on equity mutual funds instead. These funds offer professional management, diversified portfolios, and ease of monitoring. Managed by experts, they balance the risks of individual stock investments, especially relevant in fluctuating markets like IT.

Alternative to RSUs and Options: For your RSUs and other stock options, you could consider transferring the proceeds gradually into diversified mutual funds when possible. This approach allows you to benefit from market exposure while reducing the risks tied to specific stocks or sectors.

Recommended Strategy: Shift from direct stocks to equity-oriented mutual funds, especially through large and flexi-cap funds. These funds offer market-linked growth without requiring you to manage individual stocks actively. This transition can improve your portfolio's resilience, particularly in times of market downturn.

5. Retirement-Oriented Investments: PF, NPS, and PPF
Provident Fund (PF) and NPS: Your Rs 1.1 Crore in PF and Rs 20 Lakh in NPS contribute significantly to your retirement stability. With monthly contributions of Rs 1 Lakh (PF) and Rs 60,000 (NPS), these funds will provide a reliable income base post-retirement.

Investment Strategy for NPS: As you approach retirement, shift a larger portion of your NPS allocation toward debt-based options to reduce market exposure. This ensures capital preservation and steady income.

PPF & Sukanya Samrithi Yojana: With approximately Rs 30.5 Lakh invested in these schemes, you benefit from tax-free returns and stable growth. Continue with your PPF and Sukanya contributions as they provide security and are especially suitable for goals like your daughter’s education.

6. Debt Instruments and Bonds for Stability
Current Debt Portfolio: With Rs 25 Lakh in bonds and structured products, you have a stable, lower-risk segment in your portfolio. Bonds offer security, especially valuable during market downturns.

Recommended Approach: Continue holding these bonds but limit further investments in low-yield bonds. Diversified bond mutual funds may provide similar stability with better tax efficiency. Bonds offer the advantage of capital preservation, so they are well-suited for lower-risk, short-term goals.

7. Gold as a Wealth Preservation Tool
Current Holding: With Rs 1.5 Crore in physical and digital gold, you have a substantial allocation in this asset class.

Recommendation: Avoid increasing gold holdings further. While gold provides a hedge against inflation, it lacks regular income or growth potential. Retain your existing holdings, but prioritize mutual funds and debt instruments for future investments to keep a balanced asset mix.

8. Insurance Policies and Legacy Planning
Review of Existing LIC Policies: Your Rs 6 Lakh in LIC policies likely combines insurance with low returns. Consider surrendering or restructuring any low-return policies and reallocating the funds into mutual funds for better growth.

Estate Planning and Inheritance: Given your approximate inheritance value of Rs 7-8 Crore, work with a CFP to set up an estate plan, which could include a trust or will. This structure will ensure your assets are transferred smoothly and in a tax-efficient manner.

9. International Vacations and Lifestyle Expenditures
Annual Travel and Lifestyle Budgeting: Your yearly international vacations are part of your lifestyle enjoyment. Budget a fixed sum for travel and luxury expenses. By having a travel fund, you can enjoy vacations without impacting long-term financial goals.

Emergency Fund: Allocate enough for an emergency fund, preferably covering 12-15 months of expenses. Liquid mutual funds or fixed deposits are ideal for this fund due to their safety and easy accessibility.

10. Taxation Strategy and Exit Plan
Capital Gains on Mutual Funds: For equity mutual funds, long-term capital gains above Rs 1.25 Lakh are taxed at 12.5%, while short-term gains are taxed at 20%. Debt funds are taxed as per your income slab. Consider holding equity investments for the long term to minimize tax impact.

Equity Mutual Fund Withdrawals: As you near retirement, withdraw gradually from equity mutual funds to manage capital gains efficiently. Your CFP can help schedule withdrawals to optimize tax outcomes and maintain income flow post-retirement.

Final Insights
Your financial strategy reflects careful planning and a strong commitment to early retirement. With a few strategic adjustments—such as emphasizing actively managed mutual funds, gradually moving away from direct equity, and restructuring low-yield assets—you can further strengthen your portfolio. Regular reviews with a CFP will help you stay aligned with your goals, market conditions, and tax considerations.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment

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Anu Krishna  |1269 Answers  |Ask -

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Hi Madam, I'm 60,retired, my wife is 47, our son is 23. I had love marriage and was leading a happy married life. Just after silver jubilee of our wedding anniversary I accidentally came to know that my wife is madly in love with one of our common married friend who runs a simple shop. Upon investigation I found that they are in relation for last 12 years and were enjoying sex in my own house for such a long time. He hails from an uneducated family and is not even cultured. I could not believe that the wife of a highly educated socially respected man could do this with a shopkeeper who does not have any socio economic status. I am living a normal life with my wife for the sake of our only child. Once he settles in life I have decided to end my life. Ofcourse I still love her as ours was a love marriage. I seek your wise suggestion in this regard, should I divorce her or live a normal life that we are doing?
Ans: Dear Shristi,
It is obviously very shocking for you to know that things have been happening behind your back.
Now, how you want this to move on from here on, is a decision only you must make! Have you had a chat with your wife about the association that she has with the other person? Does she know that you know about it?
If she doesn't, then you need to make her aware and yes, do ask her whether she is interested at all in the marriage. That will give you an idea as to whether things are worth fighting for or is it best to walk away!

All the best!
Anu Krishna
Mind Coach|NLP Trainer|Author
Drop in: www.unfear.io
Reach me: Facebook: anukrish07/ AND LinkedIn: anukrishna-joyofserving/

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