Hi Expert, I am 43 and laid off from IT sector. I have approx 4lac in ppf, 8L in mf, 15L in stock. I have approx 15l home loan and 5L car loan as liability. Should I start for any business or or wait for upward the market for job? Any suggestions!!

Ans: Dear Mr Dinesh,
It looks like you have been through a lot after getting into business on your own. Your children too are at a critical stage in life which requires funds for higher education in the next few years. The first question to ask yourself is - what is the priority in your life? Is it financial stability for the family esp for the kids? Or is it the pursuit of your business? The second question is - what is the current status of your household finances? Is there enough savings to manage the household, upcoming education expenses, other expenses (travel, medical etc)?
If you are shaky, it may be time for you to consider taking an assignment which offers you a fixed remuneration and also flexibility to work on your idea. You say you were in the field of IT security. Can you consider an assignment which might take 2-3 days per week managing and overseeing the IT security for a company which cannot afford a full-time professional?
You may also want to consider getting incubated in a good healthcare incubator in your city and also apply for a start-up funding grant from the government of India and/or local state government programmes.

Ans: Leverage your skills in managing the play school at a relelvant place. Get a job at another play school, school etc. People with skill and hunger to do something are an asset for every organization. So dont loose heart and search for a job.

Ans: Why don't you want to continue in SCM?

In my opinion, you should continue to develop your expertise in supply chain management. Given your current role at Infosys, aim to gain more responsibilities and prove your value within the organization. You may also consider obtaining supply chain management certifications like APICS (now ASCM), Certified Supply Chain Professional (CSCP), or Six Sigma. These can increase your marketability and potential for promotions or salary increases.

Stay updated with industry trends and continue learning to adapt to changing market demands.

Ans: I appreciate your determination and proactive approach in starting a mutual fund and insurance advisory business. At 55, transitioning from a corporate job to entrepreneurship can be daunting, but it’s commendable. Let’s build a solid financial plan to secure your future, assuming you don't find another job.

Understanding Your Current Financial Situation
Assets and Income
Provident Fund (PF): Rs 57 lakhs
Insurance Maturity Amounts: Rs 60 lakhs (expected from 2028 to 2032)
Mutual Funds (MF): Rs 17 lakhs (SIP in progress)
Fixed Deposit (FD): Rs 5 lakhs
Living Flat: Rs 1.8 crores
Plot: Rs 25 lakhs
Rental Income: Rs 20,000 per month
Business and Career Goals
MF and Insurance Advisory: Aiming for long-term business (15-20 years)
Potential Regular Job: Trying to find a job for the next 5-6 years
Prioritizing Financial Goals
Ensure Regular Income: Cover monthly expenses
Maintain and Grow Investments: Secure long-term financial stability
Plan for Retirement: Prepare for a comfortable retirement
Ensuring Regular Income
Rental Income
Current Rental Income: Rs 20,000 per month
Mutual Fund SIPs
Continue SIPs: Keep the SIPs active to build wealth over time.
Systematic Withdrawal Plan (SWP): Consider SWP from mutual funds after a year or two for regular income.
Emergency Fund
Emergency Fund: Ensure you have an emergency fund to cover 6-12 months of expenses.
Liquid Funds: Keep the emergency fund in liquid or ultra-short-term funds for easy access.
Income from MF and Insurance Business
Growing Your Business
Client Base: Focus on growing your client base to increase income.
Networking: Leverage your industry contacts to get clients.
Online Presence: Build a strong online presence to attract clients.
Income Management
Diversify Income Sources: Apart from MF and insurance, consider providing financial planning services.
Training and Development: Invest in continuous learning to stay updated and offer better services.
Managing Expenses
Monthly Budget
Track Expenses: Use budgeting tools or apps to track and manage your expenses.
Cut Unnecessary Costs: Identify areas where you can reduce expenses.
Loan Repayment
Avoid New Debt: Try to avoid taking on new debt during this transition period.
Prepay Existing Loans: If possible, prepay any high-interest loans to reduce the financial burden.
Investment Strategy
Existing Investments
Provident Fund: Keep the PF invested for long-term growth.
Insurance Policies: Let the policies mature as planned for future financial support.
Mutual Funds: Continue SIPs and review the portfolio regularly.
New Investment Opportunities
Diversify Portfolio: Invest in a mix of large-cap, mid-cap, and small-cap funds.
Debt Funds: Consider investing in debt funds for stable returns and low risk.
Avoid Real Estate: Given the illiquidity and high transaction costs, avoid new real estate investments.
Tax Planning
Utilize Tax Benefits
Section 80C: Maximize the Rs 1.5 lakh limit under Section 80C.
NPS Contributions: Consider additional NPS contributions for extra tax benefits.
Tax-Efficient Investments
Long-Term Capital Gains: Focus on investments that offer tax-efficient returns.
Tax Harvesting: Use tax harvesting strategies to manage tax liabilities on mutual fund gains.
Retirement Planning
Creating a Retirement Corpus
Calculate Retirement Needs: Estimate the amount needed for a comfortable retirement.
Invest in Growth Assets: Focus on equity mutual funds for long-term growth.
Regular Review
Annual Review: Review your retirement plan annually to ensure it aligns with your goals.
Adjustments: Make necessary adjustments based on market conditions and personal circumstances.
Final Insights
Your proactive approach to starting a new business and managing your finances is commendable. Focus on growing your MF and insurance advisory business, managing your expenses, and making strategic investments. With careful planning and disciplined execution, you can achieve financial stability and a comfortable retirement.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

Ans: Assessing Your Current Financial Situation
You have significant investments and assets. Your mutual fund portfolio is Rs. 1 crore with a 10% profit. You plan to sell land for Rs. 20 lakhs and a house for Rs. 50 lakhs, totaling an additional Rs. 70 lakhs. This would bring your total available funds to Rs. 1.7 crore.

Considering Retirement Feasibility
Living Expenses
To assess if you can retire, estimate your monthly living expenses. Include housing, food, healthcare, insurance, and leisure. For a comfortable retirement, consider inflation and increasing medical costs.

Withdrawal Rate
A safe withdrawal rate is around 4% per year. With Rs. 1.7 crore, you could withdraw Rs. 6.8 lakhs annually, or around Rs. 56,000 monthly. Ensure this aligns with your expected expenses.

Reinvestment Strategy
Diversified Mutual Funds
Consider reallocating your investments for diversification and risk management. Your current portfolio is heavily skewed towards small and mid-cap funds.

Large-Cap Funds: Include these for stability and steady returns.

Multi-Cap Funds: Offer exposure across market capitalizations, balancing risk and reward.

Hybrid Funds: Invest in both equity and debt for balanced growth and stability.

Systematic Withdrawal Plan (SWP)
Consider an SWP for regular income. This will provide a steady cash flow while keeping your principal invested.

Alternative Options
Starting a Business
Starting a business can be rewarding but involves risks. Consider your interests, market demand, and initial investment. A small job could also provide income and maintain financial stability.

Seeking Employment
Returning to a corporate job can provide stability and benefits. It can also help you grow your retirement corpus further before fully retiring.

Final Insights
Evaluate your monthly expenses and future financial needs. Reallocate your portfolio for diversification. Consider an SWP for steady income. Explore small jobs or business opportunities, but weigh the risks. Returning to a corporate job can offer stability and growth.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in