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SASTRA CSE vs NIT Trichy Chemical: Which is the better choice for me?

Radheshyam

Radheshyam Zanwar  |5112 Answers  |Ask -

MHT-CET, IIT-JEE, NEET-UG Expert - Answered on Aug 06, 2024

Radheshyam Zanwar is the founder of Zanwar Classes which prepares aspirants for competitive exams such as MHT-CET, IIT-JEE and NEET-UG.
Based in Aurangabad, Maharashtra, it provides coaching for Class 10 and Class 12 students as well.
Since the last 25 years, Radheshyam has been teaching mathematics to Class 11 and Class 12 students and coaching them for engineering and medical entrance examinations.
Radheshyam completed his civil engineering from the Government Engineering College in Aurangabad.... more
vaithiyanathan Question by vaithiyanathan on Aug 05, 2024Hindi
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Which is better, CSE at SASTRA University or chemical engineering at NIT Trichy?

Ans: What is your inclination? Choosing CSE at SASTRA would be advisable over chemical. If you are getting another branch at NIT, then go for it. Else retain CSE.

If you found this suggestion helpful, please consider following me.
Radheshyam Zanwar, Aurangabad (MS)
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Ramalingam

Ramalingam Kalirajan  |9593 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 10, 2025

Asked by Anonymous - Jul 03, 2025Hindi
Money
Hellow sir. being a PSU employee ( age 35) and basic salary of 80k, I dont have much worry about the mediclaim ( which is free for my family and parents ) or PF & NPS ( which is sufficient considering basic salary ), I have following saving in my pack. 1. PPF 30L ( contributing 1.5L/ yr) 2. MF of valuation 43L ( contributing 50k/ month) 3. Fixed deposit around 12L 4. LIC around 50k / yr. 5. No loan. 6. No home under my ownership . What additional investment can be done for securing the future .
Ans: Understanding Your Current Financial Situation
– You have built a strong financial foundation already.

– Being a PSU employee, your job offers stability and retirement benefits.

– Your family’s medical and pension needs are covered by your employer.

– Your investments are well-diversified across PPF, mutual funds, and fixed deposits.

– You have no debt, which is a very healthy financial situation.

– Your life insurance premium is low, but we will discuss this later.

– You are saving Rs 50,000 per month, which is appreciable for your age.

– But you still need a clear plan for wealth growth and retirement security.

– A 360-degree review of your investments will help optimise your future.

– Let’s now assess each investment one by one.

Assessing Your Current Investments
Public Provident Fund (PPF)
– You have Rs 30 lakh in PPF, contributing Rs 1.5 lakh per year.

– PPF is a low-risk, tax-free debt option.

– But its return barely beats inflation in the long run.

– Keep contributing to maximise the Section 80C benefit.

– But PPF should not be your main wealth creation tool.

– Don’t increase your allocation beyond Rs 1.5 lakh yearly.

– Also, avoid opening another debt instrument for long-term goals.

Mutual Funds (MF)
– You have Rs 43 lakh in mutual funds, contributing Rs 50,000 monthly.

– This is your primary wealth-building avenue.

– But you have not shared your mutual fund types.

– Ensure that your funds are diversified across flexi-cap, mid-cap, and small-cap categories.

– Avoid putting all money in large caps or sectoral funds.

– Prefer regular plans over direct funds.

– Direct funds don’t offer periodic portfolio reviews or goal alignment.

– Regular plans with a Certified Financial Planner help align your funds with your financial goals.

– A Certified Financial Planner monitors performance, suggests rebalancing, and reduces emotional investing.

– Regular plans offer support during market downturns, which direct funds lack.

– Also, regular plans via MFDs provide peace of mind and avoid self-managing your portfolio.

– If you are holding index funds in your mutual fund portfolio, please take note.

– Index funds have several disadvantages.

– They blindly track the index without filtering out bad stocks.

– They don’t provide active stock selection or risk management.

– In volatile markets, index funds fall as much as the index without protecting downside.

– Actively managed funds are better suited for Indian markets.

– Active funds adjust allocations dynamically, which index funds cannot.

– Hence, please switch from index funds to actively managed regular plans.

– Rebalancing this Rs 43 lakh corpus periodically is essential.

– Otherwise, you will carry unwanted risks in your portfolio.

– A Certified Financial Planner can help fine-tune your mutual fund mix.

– Your SIP of Rs 50,000 monthly is healthy, continue it consistently.

– You may consider a step-up in SIP by 10% yearly to beat inflation.

Fixed Deposits
– You have Rs 12 lakh in fixed deposits.

– Fixed deposits are low-return, taxable instruments.

– Use this only as your emergency fund or short-term goal savings.

– Don’t lock large amounts in fixed deposits for the long term.

– Interest from FDs is fully taxable as per your income tax slab.

– Instead, you can move surplus FD money to short-term mutual funds.

– For example, liquid or low-duration debt funds.

– These funds are tax-efficient and offer better returns than FDs.

– You can keep about 6 to 12 months of expenses as an emergency fund.

– Rest of the FD money can be re-invested for better returns.

Life Insurance (LIC)
– You are paying Rs 50,000 annually for LIC.

– Please clarify what type of LIC policy this is.

– If it is a money-back, endowment, or Jeevan Anand type, please surrender it.

– These policies give poor returns, usually below inflation.

– They mix insurance and investment, which is inefficient.

– Buy a pure term insurance policy instead.

– A term plan covers your life at a low cost.

– Reinvest the surrendered LIC amount into mutual funds.

– This will help you grow your wealth faster.

– Also, keep your insurance and investment separate.

What You Are Missing
Adequate Life Insurance
– Check if your PSU offers enough group life insurance.

– Still, take a personal term insurance cover of 15 to 20 times your annual salary.

– This protects your family if anything happens during your working years.

– Don’t depend only on employer insurance.

– Personal term cover ensures protection even if you change jobs or retire.

Emergency Fund Planning
– You mentioned no loans, which is great.

– But have you built a separate emergency fund?

– Ideally, you should keep 6 to 12 months’ expenses as emergency corpus.

– Use liquid mutual funds, not savings account or FD for this.

– This fund protects you against unexpected expenses or job loss.

– Don’t mix this with your long-term investments.

Goal-Based Financial Planning
– You haven’t mentioned your goals yet.

– You need to define your financial goals.

– For example, child’s education, retirement, foreign trips, etc.

– Assign a time frame and cost for each goal.

– Allocate your investments according to these timelines.

– For short-term goals, use debt mutual funds.

– For long-term goals, use diversified equity mutual funds.

– Without goal clarity, investments remain directionless.

Retirement Planning
– PSU pension and NPS are there, but don’t solely depend on them.

– Inflation will erode your pension’s real value.

– Build a personal retirement corpus through equity mutual funds.

– This ensures financial independence in retirement.

– Target a corpus that can provide inflation-adjusted income post-retirement.

Tax Optimisation
– Your PPF contribution gives you Section 80C benefit.

– But what about Section 80D (health insurance premium) and 80CCD(1B) (NPS)?

– Though your health insurance is covered, consider claiming Rs 25,000 deduction under Section 80D.

– Your voluntary NPS contribution above Rs 1.5 lakh can get you Rs 50,000 extra deduction under 80CCD(1B).

– Also, monitor mutual fund capital gains taxation.

– Equity mutual fund LTCG above Rs 1.25 lakh is taxed at 12.5%.

– STCG in equity mutual funds is taxed at 20%.

– Debt mutual funds’ gains are taxed as per your income tax slab.

– Tax planning with a Certified Financial Planner can optimise your tax outgo.

Where You Can Invest Further
Increase SIP in Equity Mutual Funds
– Gradually increase your SIPs as your income rises.

– Focus on flexi-cap, mid-cap, and small-cap funds.

– Actively managed funds adjust better to market conditions.

– Prefer regular plans through Certified Financial Planner and MFD.

– Don’t add index funds or ETFs, as explained earlier.

– Stay invested for 10 years or more to beat inflation.

Add a Hybrid Mutual Fund for Stability
– For medium-term goals, hybrid funds can be useful.

– They balance equity and debt for smoother returns.

– But avoid conservative hybrid funds, as your risk appetite is healthy.

– Discuss with a Certified Financial Planner for the right mix.

Explore International Mutual Funds Later
– Currently, your focus should be domestic equity.

– International exposure can be evaluated later.

– This can diversify currency and market risks.

– But keep allocation small and reviewed periodically.

Voluntary NPS Contribution
– Your employer is contributing to NPS, but you can contribute more.

– This increases your retirement corpus and reduces tax.

– Use the Tier I account for tax benefits.

– Tier II is useful for medium-term goals but has no tax benefits.

Reinvest LIC Savings Wisely
– If you surrender your LIC, invest the proceeds into mutual funds.

– This unlocks better returns than what LIC policies offer.

– Don’t use this for low-return or locked-in products.

Reduce Fixed Deposit Reliance
– Reallocate part of your fixed deposits to short-term mutual funds.

– This increases your post-tax returns without increasing risk much.

– Keep only what is needed for emergencies in FDs.

Other Action Points for a 360-Degree Plan
Regular Portfolio Reviews
– Review your portfolio every six months with your Certified Financial Planner.

– Rebalance if any fund underperforms or if your goals change.

– Don’t leave the portfolio untouched for years.

– Avoid emotional exits during market falls.

Will and Estate Planning
– Create a simple Will to secure your family’s future.

– Nominate your family in all your investments.

– Keep your spouse aware of your financial accounts and plans.

Avoid Unnecessary Investments
– Don’t go for real estate purchases just for investment.

– Real estate locks money and offers poor liquidity.

– You have no home currently, but buy one only if you plan to live in it.

– Also, avoid gold investments for wealth creation.

– Gold is a store of value but not a wealth multiplier.

– Don’t explore annuities as they give poor post-tax returns.

– Stick to mutual funds and PPF for your financial goals.

Personal Financial Discipline
– Increase your SIPs with each salary hike.

– Track your expenses but don’t compromise on essential lifestyle needs.

– Plan vacations and family expenses without disturbing your financial goals.

– Keep your debt at zero or minimal.

Finally
– You are doing well for your age with savings and investments.

– Focus on optimising your portfolio, not chasing new options.

– Actively managed mutual funds through a Certified Financial Planner should be your core.

– Exit inefficient products like endowment LIC plans.

– Maintain your emergency fund separately and review goals yearly.

– Add voluntary NPS and hybrid funds for diversification.

– Regular monitoring with your Certified Financial Planner will fine-tune your journey.

– Stay consistent, disciplined, and goal-focused.

– This approach will secure your financial future with peace of mind.

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

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Ramalingam

Ramalingam Kalirajan  |9593 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 10, 2025

Asked by Anonymous - Jul 03, 2025Hindi
Money
Hi I am Hemant Dutta. My age is 30 and take home salary is 80k per month now. Working from 2.5 years. My wife also have a running business from where she earn 1.5 lakh to 1.75 lakh. My additional income are approx 5 to 7 k per month. Recently we bought a land market value of 24 to 25 lakh. Monthly expenses are 16000 as rent. Other are 14000 (electricity and grocery) Investment: 15000 every month on SIP 23000 AS comittee installment from where we received 50000 as profit in 20 months. We have no other liability. How many years we have to work to get retired and will be financially stable
Ans: Understanding Your Financial Background
– Hemant, your financial foundation is solid for your age.
– You have a steady salary of Rs. 80,000 monthly.
– Your wife’s business income adds Rs. 1.5 to 1.75 lakhs every month.
– Additionally, Rs. 5,000 to 7,000 per month boosts household income.
– You recently bought a land worth Rs. 24–25 lakhs.

– Monthly rent is Rs. 16,000.
– Utilities and groceries cost Rs. 14,000 monthly.
– That totals to about Rs. 30,000 in monthly expenses.
– You invest Rs. 15,000 in SIPs.
– You also contribute Rs. 23,000 to a committee.
– That gave Rs. 50,000 profit over 20 months.

– No other loans or liabilities. That’s very good.
– Overall, your combined income and investments show great early planning.

Estimating Retirement Timeline
– You want to know when you can retire and be financially stable.
– That depends on many variables. Let’s understand each clearly.

– Your current age is 30. Retirement goal can be early, say age 50 or 55.
– You both earn approx Rs. 2.35 to Rs. 2.62 lakhs monthly.
– Expenses are just Rs. 30,000. That’s very low in proportion.

– That means you save more than Rs. 2 lakhs monthly.
– This high saving rate is your biggest strength.
– If maintained well, early retirement is absolutely possible.

Monthly Surplus and Savings Potential
– Your SIP is Rs. 15,000 monthly.
– Committee contribution is Rs. 23,000.
– Let’s treat it as a savings vehicle with low returns.
– After Rs. 30,000 in expenses and Rs. 38,000 in investing,
– You still have around Rs. 1.7–2 lakhs left every month.

– This surplus must be strategically used.
– It should not lie idle in savings account.
– Idle money loses to inflation and taxes.
– Use this money for structured, long-term investment.

Key Factors in Retirement Planning
– Retirement depends on four major components:

Your current savings

Future investments

Your target retirement lifestyle

Your post-retirement lifespan

– You need a clear target corpus for retirement.
– You should estimate future expenses considering inflation.

– Let’s assume your current monthly need is Rs. 30,000.
– With inflation, this can go above Rs. 1 lakh in 20–25 years.
– Your retirement corpus must generate that without exhausting itself.

– So, your goal is to build a large, sustainable investment pool.
– That corpus will give monthly income post-retirement.

Evaluating Your Current Investment Strategy
– Your SIP of Rs. 15,000 is a good beginning.
– But it needs to be scaled up gradually.
– With high surplus, you can easily increase SIPs.

– SIP should be split into a balanced mix.
– Avoid over-allocating into one risky segment.
– Use a diversified approach across categories.

– Index funds are passive and rigid.
– They can’t beat market during corrections.
– They follow market blindly, even in crashes.
– Active funds managed by professionals are better.
– They adjust holdings based on market conditions.

– Direct plans may seem to give more returns.
– But they lack ongoing guidance and support.
– Without a Certified Financial Planner or MFD,
– Mistakes in fund selection or exit timing are common.
– Regular plans through Certified Financial Planners offer
ongoing review, rebalancing and behavioural coaching.

Recommended Action Plan to Retire Early
– Step 1: Fix your retirement goal age.
– Choose between 50 and 55 years based on comfort.

– Step 2: Estimate future monthly expenses.
– Multiply your current lifestyle cost with expected inflation.
– A Certified Financial Planner can assist with clarity.

– Step 3: Target a retirement corpus.
– That corpus should generate income for at least 30 years post-retirement.

– Step 4: Use the high surplus wisely.
– Increase SIP to Rs. 50,000 monthly within a year.
– Invest another Rs. 1 lakh monthly in long-term MFs.

– Step 5: Review insurance coverage.
– Health insurance must cover both of you adequately.
– Term insurance is needed if any future loans or dependents are expected.

– Step 6: Don’t add more land or gold.
– These are illiquid and don’t support retirement cash flow.

– Step 7: Avoid investment-cum-insurance policies.
– If you hold LIC, ULIP or similar plans, surrender and reinvest in mutual funds.

– Step 8: Create an emergency fund of Rs. 4–5 lakhs.
– This should be in liquid funds or short-term debt MFs.

– Step 9: Review your mutual fund portfolio every 6 months.
– Don’t keep old or underperforming funds for long.

– Step 10: Set financial milestones.
– Track wealth creation every year with a retirement tracker.

Creating Passive Income Streams
– For early retirement, passive income is essential.
– Relying only on mutual fund withdrawals is risky.
– Start planning for monthly income generation through:

Balanced Advantage mutual funds with SWP

Conservative hybrid mutual funds

Systematic withdrawal from debt and hybrid funds

– Don’t fall for annuities.
– They give poor returns, low flexibility and are taxable.

Tax Implications to Be Aware Of
– New capital gain tax rules apply.
– For equity MFs: LTCG above Rs. 1.25 lakh taxed at 12.5%.
– STCG taxed at 20%.
– For debt funds: Both LTCG and STCG taxed as per income slab.

– Plan redemptions carefully to reduce taxes.
– A Certified Financial Planner can help optimise this.

Wife’s Business Income Utilisation
– Her business earns around Rs. 1.5 to 1.75 lakh monthly.
– After household expenses and your SIPs,
– Her entire income can be used for long-term goals.

– Open a separate investment portfolio in her name.
– Use part of it for retirement planning.
– Use part of it for future goals like children, travel, health care.

Role of a Certified Financial Planner
– A qualified CFP helps plan long-term wealth creation.
– He will assist in building, reviewing and rebalancing portfolio.
– He brings discipline and protects against behavioural mistakes.

– He also creates a goal-based investment plan.
– For early retirement, this kind of expertise is essential.
– With your current surplus, a structured strategy will
help you retire peacefully before age 50.

Final Insights
– You both have a strong financial base.
– Your income is high, and expenses are modest.
– Savings potential is excellent, and SIPs are already in place.

– With the right guidance, you can achieve early retirement.
– Build a diversified mutual fund portfolio with increasing SIPs.
– Avoid real estate, ULIPs, annuities and direct mutual funds.

– Involve a Certified Financial Planner to monitor progress.
– Retiring by 50 is very realistic for you.
– You just need steady action and regular portfolio reviews.

– Stay disciplined, stay invested and keep your goals sharp.

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

...Read more

Ramalingam

Ramalingam Kalirajan  |9593 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 10, 2025

Asked by Anonymous - Jul 03, 2025Hindi
Money
Hey, i am 45 years old, earning 2lakhs per month. Have 13 years girl,10yrs boy.I am investing 20k per month in SIPs since 5 years. Investing 20k in NPS per month since an year. Having 5laks health insurance, 25lakhs ter insurance and having life insurance for 20lakhs going to mature in 2028. Having 10lakhs as an emergency fund. Having indipendent G+1 house in Hyderabad, no loans. How i can plan for retirement in 10 years
Ans: Understanding Your Current Financial Snapshot
Your current financial status shows good discipline and foresight.

– Age is 45.
– Monthly income is Rs. 2 lakhs.
– SIPs of Rs. 20,000 running since 5 years.
– NPS contribution of Rs. 20,000 monthly since a year.
– Health cover of Rs. 5 lakhs.
– Term insurance of Rs. 25 lakhs.
– Additional life insurance worth Rs. 20 lakhs maturing in 2028.
– Emergency fund of Rs. 10 lakhs.
– Own independent house in Hyderabad.
– No loans.
– Two children aged 13 and 10.

You’ve done well in many areas. But retirement needs focused adjustments now.

Assessing the Gaps in Retirement Planning
You want to retire in 10 years. That means at age 55.

– Retirement corpus should last 30 years post-retirement.
– Inflation will impact lifestyle expenses over time.
– Children’s education and marriage needs will arise soon.
– Health care costs will grow sharply with age.
– Existing investments need deeper review.

You must now assess how much monthly income you’ll need after retirement.
Let’s assume lifestyle stays similar, and no rental income from the house.

Re-evaluating Your Insurance Coverage
Let’s start with life and health protection.

– Rs. 25 lakh term cover is low for your income.
– Ideally, term cover should be 10-12 times your annual income.
– That’s around Rs. 2 crore for your current earnings.
– You can enhance the term cover for next 10 years only.

– Health insurance of Rs. 5 lakhs is not sufficient.
– For a family of four, aim for Rs. 15 to Rs. 20 lakhs coverage.
– Add super top-up of Rs. 10 to 15 lakhs with Rs. 5 lakh deductible.

Review your life insurance maturing in 2028.
It’s not effective for investment or protection.
Such policies give low return and insufficient coverage.
If this is an investment-cum-insurance or ULIP, surrender it.
Reinvest the maturity amount through mutual funds via CFP-backed MFD.

Emergency Fund – Well Done
Rs. 10 lakhs as emergency fund is adequate for now.

– Keep it in liquid funds or FD for easy access.
– Review every year and adjust if monthly expenses increase.
– Emergency fund should be equal to 6-12 months expenses.

Review of Your Current SIPs
Rs. 20,000 SIP running for 5 years is a great habit.

– Let’s review where it is invested.
– If invested in direct funds, please note the concern.

Direct mutual funds come without advisory support.
Without proper guidance, you might choose wrong funds or exit too early.
It is always better to invest via regular plan through a CFP and MFD.
That way, you get regular portfolio review and personal guidance.

– If you are invested in index funds, there’s more to consider.
– Index funds are unmanaged and track the market.
– They cannot outperform the market.
– During market fall, they fall equally.
– Actively managed funds are better for long-term growth.
– Fund managers try to reduce risk and outperform benchmarks.

Continue your SIPs but ensure proper scheme selection and asset allocation.
Consult a CFP-led team to ensure your SIPs match your retirement goals.

NPS Investment – Understand the Role
Rs. 20,000 monthly in NPS is a good start for retirement.

– But NPS has limits.
– After 60, only 60% can be withdrawn as lump sum.
– Remaining 40% must be used to buy annuity.
– Annuities give very low returns and no flexibility.
– NPS withdrawals are taxed as per slab too.

So NPS should be just one part of retirement plan.
Don’t depend solely on it for retirement income.

Retirement Planning for 10 Years Ahead
Now we plan for your main goal – peaceful retirement at 55.

– You have 10 years to build enough corpus.
– This needs aggressive but balanced investing.
– Continue with mutual fund SIPs. Increase it by 10% every year.
– Invest across large, mid, and flexi-cap funds.
– Include hybrid funds for stability.
– Get proper rebalancing done yearly.

– Shift money from poor performing policies.
– Exit from endowment or ULIPs after consulting CFP.
– Redirect that money to mutual funds.
– Avoid real estate. It is illiquid and not suited for retirement goals.

– Start a separate goal-based SIP for retirement.
– Keep this separate from education or marriage goals of children.
– If possible, save 30-35% of your income now.
– Since no loans or EMIs, you can invest more every month.

– Include international mutual funds if needed for diversification.
– These are actively managed and give global exposure.

Track retirement corpus every year.
Review fund performance with a CFP regularly.

Children’s Education and Marriage Goals
Your daughter is 13. Big expenses in next 5-7 years.
Your son will need it in about 8-10 years.

– Education costs are growing fast.
– Start separate SIPs for their goals.
– Use hybrid and balanced advantage funds for medium term.
– Review portfolio each year based on fee requirements.
– For marriage goal, keep timeline in mind.

Don’t mix these goals with retirement fund.
Prioritise education over marriage.

Tax Efficiency and Exit Strategy
New tax rules on mutual funds should guide your planning.

– Equity mutual funds:
LTCG above Rs. 1.25 lakh taxed at 12.5%.
STCG taxed at 20%.

– Debt mutual funds:
Taxed as per income slab, whether long or short term.

Plan withdrawals post-retirement to reduce tax burden.
Don’t withdraw entire corpus at once.
Use Systematic Withdrawal Plans (SWP) post-retirement.

– SWP from mutual funds gives regular income.
– Also gives better tax management than pension or annuities.

Estate and Will Planning
You’ve built good wealth. Protect it for your family.

– Make a clear and valid Will now.
– Mention asset allocation and nominee details.
– Add details about mutual fund folios, insurance, NPS etc.
– This ensures smooth transition for your family.

Inform spouse about where and how assets are held.
Keep a written record of all investments.

Regular Review and Course Correction
Retirement plan is not a one-time activity.

– Review portfolio once every year.
– Rebalance asset allocation if needed.
– If equity markets do well, reduce equity exposure after age 52.
– Shift to hybrid and balanced funds closer to retirement.
– Avoid panic-selling during market corrections.

Take help of a Certified Financial Planner regularly.
They guide with behavioural, technical, and tax aspects.

Avoid investing on friend’s or relative’s advice.
Choose advisors who are certified and experienced.

Finally
You have a strong foundation in place already.

– No debt.
– Good income.
– Regular SIPs.
– NPS contributions.
– Emergency fund.
– Term insurance.

Now build upon this foundation with a goal-specific approach.
Ensure every rupee is working for your retirement target.
Plan tax-efficient withdrawals post-retirement.
Separate goals for children’s future.
Upgrade insurance for life and health.
Invest only in professionally managed mutual funds.
Don’t choose index or direct funds without guidance.
Avoid real estate or annuities.

With right planning and support, retiring at 55 is possible for you.
360-degree financial clarity will make your journey peaceful.

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

...Read more

Ramalingam

Ramalingam Kalirajan  |9593 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 10, 2025

Money
Hi, I am 37 year old, with 2 kids aged 8 year and 5 year. My monthly income is 4 lakh( Private sector). Expense are around 1 lakh, I live with my parent in their house, so no rent .I have a car loan of 9 lakh and no other debt. Investment are 2 lakh in stocks, 3 lakh in PF, 1 lakh in NPS. Two major investment are in property land,one is 20 Lakh and other is in 25 lakh in wife name. These are long term for kids future. How should I plan if I wish to retire by 50. As my salary nearly double in last year,so I haven't saved too much for future.
Ans: Understanding Your Current Financial Position
– You are 37 years old with Rs. 4 lakh monthly income.
– Expenses are Rs. 1 lakh monthly.
– You live in a family-owned home, so no rent burden.
– You have a car loan of Rs. 9 lakh.
– Investments include Rs. 2 lakh in stocks, Rs. 3 lakh in PF, and Rs. 1 lakh in NPS.
– You hold two land properties worth Rs. 20 lakh and Rs. 25 lakh (wife’s name).
– You wish to retire at 50, giving you 13 years to build wealth.
– Salary growth has been sharp recently, but savings haven't yet caught up.

Appreciating Your Positive Habits
– Living without rent is a strong enabler for wealth building.
– Your expense level is well-controlled at 25% of your income.
– You have stayed away from personal loans or credit card debt.
– The presence of EPF and NPS shows a foundation of discipline.

Areas That Need Immediate Attention
– Your liquid investments are low compared to income.
– Stock exposure is small and not diversified.
– PF and NPS are long-term but not enough for early retirement.
– Land is illiquid and won’t help in short or medium term.
– No mention of term insurance or medical cover yet.
– Car loan adds unnecessary monthly commitment.

Step 1: Establish Emergency Fund
– First, set up an emergency fund of Rs. 6 to 8 lakh.
– This is equal to six months of expenses plus EMIs.
– Use liquid mutual funds or sweep-in fixed deposits.
– Do not depend on stocks or real estate during an emergency.

Step 2: Protect Your Family First
– Buy a pure term insurance plan with Rs. 2 crore sum assured.
– Ensure the term covers you till age 60 or more.
– Keep annual premium below 1% of your income.
– Do not mix insurance with investment like ULIPs or endowment plans.
– For health cover, take a floater policy for you, wife, and kids.
– Also take individual policy for parents if not already done.

Step 3: Rework and Accelerate Investments
– Your surplus is Rs. 3 lakh monthly. That is powerful.
– Start SIPs in a mix of actively managed mutual funds.
– Use regular plans through an MFD who is also a Certified Financial Planner.
– Direct funds lack personalised guidance and after-sales support.
– Regular plans give you lifetime handholding, goal tracking, and rebalancing.
– Don’t get lured by 1% lower expense ratio of direct plans.
– Missteps in direct plans often cost more in losses.

Step 4: Strategic Mutual Fund Allocation
– Use large-cap, flexi-cap, mid-cap, and aggressive hybrid funds.
– Allocate higher weight to hybrid and flexi-cap in early years.
– Slowly increase mid and small-cap allocation over 5 years.
– Avoid index funds.
– Index funds fall fully during market crashes.
– No fund manager adjusts for market downturns.
– Actively managed funds give downside protection and long-term alpha.

Step 5: Reduce and Close Debt Quickly
– Car loan is a luxury debt, not asset-building.
– Aim to prepay it in the next 12 to 18 months.
– Redirect EMI outflow into SIPs after loan closure.
– Avoid taking any new loans for depreciating assets.
– For future car needs, save via SIP, not loans.

Step 6: Goal-Based Planning for Children
– Children’s higher education is 10 to 13 years away.
– Set clear target for each child’s education (Rs. 25 lakh or more).
– Invest separately for each child using dedicated mutual fund SIPs.
– Use hybrid or balanced advantage funds in initial years.
– Move to conservative hybrid or short-term debt funds from age 15.
– Real estate cannot be used easily to pay college fees.
– Don’t rely on selling land for time-bound goals.

Step 7: Plan for Early Retirement at 50
– You have 13 active income years. Use them smartly.
– Create two buckets: one for retirement corpus and one for pre-retirement goals.
– Allocate minimum Rs. 1.5 to 2 lakh monthly for retirement.
– Increase SIPs every year with salary hike by at least 10%.
– Use only equity mutual funds and aggressive hybrid funds for this.
– From age 47, slowly move some money to conservative hybrid funds.
– After 50, use SWP (Systematic Withdrawal Plan) to draw monthly income.

Step 8: Consider Retirement Lifestyle
– Target monthly income of Rs. 1.5 lakh in retirement (inflation adjusted).
– You need a retirement corpus of approx. Rs. 4 to 5 crore.
– This corpus must last 35+ years post retirement.
– Relying only on PF and NPS will not suffice.
– They will cover less than 20% of your future needs.
– Hence, focus on mutual funds for wealth creation.

Step 9: Use Real Estate Only for Legacy or Passive Use
– You hold two land parcels, one in your wife’s name.
– They are not liquid and can’t help in education or retirement.
– Do not plan short-term goals based on selling land.
– Keep them as long-term legacy assets.
– Ensure proper legal documentation and nomination is in place.
– If you plan to sell one, do it early and invest proceeds into mutual funds.

Step 10: Avoid These Common Mistakes
– Don’t invest in insurance-linked plans.
– Don’t go for annuities as retirement products.
– Don’t put money into low-return FDs for long term.
– Don’t delay investment waiting for right market timing.
– Don’t mix emotional decisions with financial goals.
– Avoid buying more real estate for investment purpose.
– Don’t invest in products you don’t understand fully.

Step 11: Review Your Plan Every Year
– Review SIPs, insurance, and debt every 12 months.
– Adjust asset allocation based on age and goals.
– Rebalance mutual funds as advised by your MFD/CFP.
– Use family discussions to align financial goals.
– Keep nominations updated for all investments.
– Don’t skip annual health and term insurance renewal.

Step 12: Secure Wife's Financial Participation
– Wife’s name is on one land, but no mention of income or investments.
– Ensure she has her own term and health cover.
– Begin SIPs in her name also if she has no income.
– It brings tax efficiency and asset diversification.
– Include her in all financial planning discussions.
– Educate her on mutual funds, banking, and insurance basics.

Step 13: Tax Efficiency and Smart Withdrawals
– Equity mutual funds: LTCG above Rs. 1.25 lakh taxed at 12.5%.
– STCG is taxed at 20%.
– Debt mutual funds: gains taxed as per income tax slab.
– Keep track of holding periods while redeeming.
– Use SWP from mutual funds to get tax-efficient income post-retirement.
– Avoid high tax payout by premature redemptions.

Step 14: Create a Clear Written Financial Plan
– List down all goals with target dates.
– Include retirement, education, travel, health, and contingency.
– Discuss this with a Certified Financial Planner (CFP).
– CFP will create a personalised plan based on risk profile.
– Choose an MFD with CFP qualification for investments.
– They bring clarity, long-term tracking, and professional advice.

Final Insights
– You are in a powerful position to shape your financial future.
– Your income, savings capacity, and family setup are ideal for building wealth.
– But you must act now and act wisely.
– Focus on liquidity, protection, and structured investments.
– Move beyond land and stocks alone.
– Keep long-term vision and stick to disciplined investing.
– Don’t hesitate to take expert help from a Certified Financial Planner.
– Start now, stay consistent, and you can retire early with peace.

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

...Read more

Nayagam P

Nayagam P P  |8416 Answers  |Ask -

Career Counsellor - Answered on Jul 10, 2025

Career
My son has three options_ Nit Patna CSE or COEP CSE or Bits Hyderabad ECE...Please guide me what to choose?
Ans: Ramprasad Sir, NIT Patna in Bihar delivers a B.Tech in Computer Science & Engineering with an 89.62% branch?wise placement rate over the past three years, an average package of ?11.3 LPA and top recruiters including Microsoft, Morgan Stanley and PwC, supported by NBA?accredited facilities, AI/ML research labs, Ph.D. faculty and strong industry partnerships. COEP Technological University in Pune offers CSE with an 87.42% placement rate, an average package of ?11.35 LPA, and campus drives from Google, Mastercard and Bajaj Finserv, underpinned by NAAC A++ accreditation, modern computing labs, a proactive placement cell and extensive corporate tie-ups. BITS Pilani Hyderabad Campus provides ECE with a 28.47 LPA average package and an 87.23% overall UG placement rate, leveraging a unique Practice School model, state-of-the-art VLSI and communications labs, strong research collaborations and global recruiters like Qualcomm, Nvidia and Intel.

Recommendation: Prioritise NIT Patna CSE for its highest placement consistency in core computing, accredited AI/ML labs and robust government-institute stability. Next, choose COEP Pune CSE for its balanced placement momentum, industry?immersive curriculum and NAAC A++ infrastructure. Opt for BITS Hyderabad ECE third to leverage exceptional VLSI research facilities, Practice School internships and premium average packages in electronics. All the BEST for Admission & a Prosperous Future!

Follow RediffGURUS to Know More on 'Careers | Money | Health | Relationships'.

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Ramalingam

Ramalingam Kalirajan  |9593 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 10, 2025

Asked by Anonymous - Jul 02, 2025Hindi
Money
Hi, I'm 37 years old and have one kid studying in 1st std. My yearly income is 12lk , and currently i have invested around 20lk in 4 mutual funds, one is index fund, one is small, one is blue chip and another is flexi cap, have a ppf and invested around 8lks in bonds, i dont have debt. My plan is to earn around 25 crore. Can i achieve this goal if yes by when? Or need more investments?
Ans: Understanding Your Current Financial Position
– You are 37 years old with one child in primary school.
– Annual income is Rs. 12 lakhs, which means Rs. 1 lakh per month.
– You have no debt, which is excellent.
– You have invested Rs. 20 lakhs in 4 mutual funds.
– You have a PPF account and Rs. 8 lakhs in bonds.

That gives you a solid foundation to build on.

Evaluating Your Existing Investment Portfolio
– Your portfolio includes an index fund, small cap, bluechip, and flexi cap fund.
– This shows you are diversifying well across market segments.
– However, index funds come with certain risks you must know.

Disadvantages of Index Funds
– Index funds don’t protect during market downturns.
– They blindly copy the index, even if some companies are weak.
– There is no active fund manager to manage risk.
– They also don't provide alpha (returns beyond the index).
– Volatility is high in market crashes.

You may want to replace index fund with an actively managed one.

Actively Managed Funds Are Better Because:
– Fund managers make timely decisions based on market conditions.
– They aim to outperform the benchmark.
– Active funds can control downside risk better.
– The performance gap widens over longer durations.

For wealth creation, active fund management is more reliable.

Portfolio Type and Fund Access Mode
– If you are investing through direct plans, consider switching to regular plans.
– Direct plans don’t come with personalised support.
– No monitoring or rebalancing guidance is available.
– Also, switching between funds is not properly timed.
– Mistakes in selection and exit strategy are common.

Why Regular Plans Through a Certified Financial Planner Help:
– A Certified Financial Planner (CFP) offers 360-degree guidance.
– You get timely rebalancing, tax planning, and asset allocation support.
– It avoids emotional decisions during market swings.
– CFPs help you align funds to life goals.
– Long-term partnership makes wealth creation disciplined.

Current Asset Summary and Assessment
– Rs. 20 lakhs in mutual funds (diversified across categories).
– Rs. 8 lakhs in bonds, which are safe but low yielding.
– PPF is also a long-term safe asset, but with moderate returns.
– Total financial investments = around Rs. 30+ lakhs.

Your savings pattern is positive, but the target is extremely high.

Your Wealth Goal Assessment: Rs. 25 Crores
– Rs. 25 crore is a very large target.
– Achieving this needs long-term, consistent investments.
– You need higher annual savings and strong equity allocation.
– We need to check both contribution and compounding factors.

Let’s examine whether your current investments are enough.

How Time and Investment Growth Work Together
– You are 37 now.
– Let’s assume you plan to invest for 18 more years till age 55.
– This gives you a medium to long horizon.
– However, just relying on current savings may fall short.
– More contribution is needed to reach Rs. 25 crores.

Let us assess what can be changed to reach the goal.

Income and Savings Pattern Evaluation
– You are earning Rs. 1 lakh per month.
– From that, we don’t know your monthly investment.
– Let’s assume you are saving Rs. 25,000 to Rs. 30,000 monthly.
– At this rate, and with a good return, corpus may reach around Rs. 3.5 to Rs. 4.5 crores in 18 years.
– That’s still far from Rs. 25 crores.

So yes, goal is possible, but only with more savings and discipline.

Needed Change in Investment Contribution
– You need to aim for saving at least Rs. 60,000 to Rs. 70,000 per month.
– That is 60% to 70% of income, which may not be practical now.
– Hence, increasing income should be the parallel focus.
– Also, look for lump sum investments from bonuses or gifts.

Every rupee saved early compounds better later.

Strategy for Mutual Fund Portfolio Optimisation
– Retain small cap, flexi cap, and bluechip exposure.
– Replace index fund with an actively managed large or multi cap fund.
– Keep asset allocation to 70% equity, 20% fixed income, 10% gold.
– Rebalance once a year.

You may need 5-6 diversified funds, not more.

Role of PPF and Bonds in Your Portfolio
– PPF and bonds are safe and long-term oriented.
– PPF helps with retirement and tax saving.
– Bonds give capital protection, but returns are limited.
– You should not increase allocation to bonds beyond 20%.
– Keep equity exposure dominant for wealth creation.

Security is important, but growth is crucial to reach Rs. 25 crores.

Child's Education Planning
– Your child is in 1st standard now.
– You have 10 to 12 years before higher education costs arise.
– This is a defined goal, and must be planned separately.

What you should do:
– Start a separate SIP for child’s education.
– Avoid using current portfolio for this goal.
– Choose long-term equity funds to beat education inflation.
– Increase SIP amount every year.

This avoids goal compromise later.

Retirement Planning Parallelly
– If you plan to retire early, start planning now.
– Rs. 25 crores may include retirement too.
– In that case, don’t use this corpus for child goals.
– For retirement, equity-oriented funds are essential.
– You can also invest in NPS up to Rs. 50,000 for tax benefits.

Separate goals mean focused and accurate planning.

Tax Impact on Mutual Funds (New Rules)
– Long term capital gains (LTCG) on equity above Rs. 1.25 lakhs is taxed at 12.5%.
– Short term gains are taxed at 20%.
– Debt mutual funds are taxed as per income tax slab.
– Plan redemptions to avoid unnecessary tax outgo.

Tax planning must go hand in hand with investment planning.

Emergency Fund and Risk Management
– Ensure you have 6 to 9 months of expenses in emergency funds.
– This keeps your mutual funds safe from panic withdrawals.
– Also review health and life insurance coverage.
– You are the primary earner, so protection is essential.

Insurance is not investment. Keep them separate.

Goal Tracking and Course Correction
– Review your investment progress every year.
– Track your net worth and adjust SIPs.
– If income increases, raise SIPs proportionately.
– Use tools or consult a Certified Financial Planner for help.

Regular tracking ensures you stay on course.

Avoid Common Mistakes in Wealth Creation
– Don’t chase returns. Focus on discipline.
– Avoid frequent switching of funds.
– Don’t fall for exotic products like ULIPs, traditional plans, or endowment policies.
– Don’t stop SIPs in market corrections.
– Don’t take advice from social media blindly.

Focus, discipline, and patience are key.

Finally
– Rs. 25 crore is achievable but very ambitious.
– Your current investments are not enough to reach that number.
– You must increase monthly savings steadily.
– Avoid index funds and direct plans.
– Use regular plans and work with a Certified Financial Planner.
– Separate goals clearly—education, retirement, wealth building.
– Focus on equity, reduce bond exposure.
– Track every year, and adjust as needed.

With effort, focus, and guidance, your goal can turn into reality.

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

...Read more

DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Investment in securities market are subject to market risks. Read all the related document carefully before investing. The securities quoted are for illustration only and are not recommendatory. Users are advised to pursue the information provided by the rediffGURU only as a source of information and as a point of reference and to rely on their own judgement when making a decision. RediffGURUS is an intermediary as per India's Information Technology Act.

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