Dear Doctor, I am 61 yrs young. My BP is 140/85 or 136/80 with Olsar A40 in the morning. I had Angina pain, Was a smoker-now left for good for last 9 months. Cholosterol is normal-ECG ECHO 2D TMT ECG all normal-Angiography normal, I am taking Revelol XL 50 in morning-Nikoran 10 OD in morning,Ecosprun gold at night.Now despite all tests normal,i have intermittent slight pain atleast twice daily inside the last 2 left rib cage.Chest x-ray was normal.What could be the reason?

Ans: Hello;

The second option proposed is highly recommended.

Sell the land and utilize sale proceeds to make lumpsum investment in mutual funds for your retirement and other part to buy an apartment in a gated community.

You need a lumpsum investment of 40 L in a combination of pure equity mutual funds which may grow into a sum of 5 Cr+ over 22 years. (A modest return of 12% is considered)

Happy Investing;
X: @mars_invest

Ans: Hello;

You can start pension after attaining 58 years of age irrespective of whether you are working or retired.(A reduced pension is also possible if you fulfill conditions of EPS 95 scheme, after 50).

Make sure entire 12% of the employer contribution is credited to your pf account.

Best wishes;
X: @mars_invest

Ans: Hello;

Request you to please rephrase your question and submit again.

Thanks;

Ans: Hello;

Why do you want to use insurance for your retirement planning?

They provide pathetic return on investment.

NPS or mutual funds is highly recommended for retirement planning.

If you have any other queries, feel free to revert.

Happy Investing;
X: @mars_invest

Ans: Your plan demonstrates a well-thought-out approach to leveraging your investments while keeping liabilities manageable. Your decision to raise funds through an overdraft loan against shares and mutual funds is practical given the significant market value of your investments. However, there are a few aspects to evaluate for better clarity and financial stability.

Advantages of Your Strategy
Liquidity Without Selling Investments: Using an overdraft loan against your equity and mutual fund investments helps retain the assets.

SWP to Cover Interest Payments: A systematic withdrawal plan (SWP) ensures regular cash flow to meet interest expenses.

Property Value as Collateral: Your land property provides additional financial security.

Future Potential of Investments: Your expectation of Rs. 10 crore over 7-8 years appears reasonable given historical growth trends.

Concerns and Potential Risks
Market Volatility: Both equities and mutual funds are subject to market fluctuations.

Interest Burden: Over time, the compounding of the interest at 10.35% could strain liquidity.

Delays in Property Completion: Construction delays could impact cash flow plans.

Over-dependence on SWP: Over-reliance on SWP can erode long-term wealth if markets underperform.

Alternative Ways to Manage Overdraft Loan
Diversify Funding Sources
Split the Loan Amount: Explore partial loans from banks or NBFCs secured by the property itself.

Loan Against Fixed Deposits: Use your FD as collateral for a part of the loan.

Consider a Lower-Interest Loan: Negotiate with lenders for a lower interest rate.

Optimise SWP Strategy
Adjust Withdrawal Amount: Reduce SWP if the market experiences a downturn.

Partial Sale of Underperforming Units: Sell a small portion of underperforming investments to reduce the loan burden.

Construction Phasing
Build in Phases: Start with 2-3 floors initially to reduce the upfront loan requirement.

Rental Income from Early Units: Generate income from completed units to support loan repayment.

Emergency Backup Plan
Sell a Unit if Needed: Keep the option of selling one residential unit open to clear the loan.

Gold as Last Resort: Liquidate a small portion of gold only in extreme situations.

Tax Implications
Interest Deduction: Interest paid on loans for property construction could have tax benefits. Consult a tax expert for clarity.

Capital Gains on SWP Withdrawals: Gains from equity mutual fund SWP above Rs. 1.25 lakh per year will be taxed at 12.5%. Ensure tax liabilities are factored in.

Sale of Units: If you sell a unit to repay the loan, calculate the long-term capital gains taxes.

Key Points for Wealth Growth
Reinvest Profits Post Loan Repayment: Post-repayment, redirect surplus to equity or mutual funds for wealth growth.

Monitor Investments Regularly: Periodically review the performance of equity shares and mutual funds.

Diversify Investments: Post-retirement, ensure a diversified portfolio for steady income and wealth preservation.

Finally
Your plan is practical and aligns with your financial goals. However, diversification of funding sources, optimising SWP, and monitoring loan repayment are crucial. Prepare for market volatility and create an emergency backup plan. This approach ensures stability while maximising wealth creation.

Best Regards,

K. Ramalingam, MBA, CFP

Chief Financial Planner

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

Ans: Many colleges are there. Give entrance examinations first, then contact me with rank. Then I will be able to guide you. Without knowing rank, it will be a wild guess.

Ans: You should not go for software course. If you are looking for job in IT sector, then why are you studying civil engineering? So, two options are these. Prepare for govt. job. If you get that then rest of your will become more peaceful and secure. If you choose to do higher study then you should give GATE and do M.Tech in good institutions with scholarship. In that case you will be financially independent.

Ans: Hello;

You should exit your direct equity investment as early as possible and close the demat/trading account.

Also mutual fund investments for 3-5 year horizon should be in equity savings type mutual funds or conservative hybrid debt funds.

Avoid exposure to pure equity funds/ETFs.

It is not suitable for your age and time horizon.

Best wishes;
X: @mars_invest

Ans: Hello;

1. It is advisable to invest lumpsum of 5 L in a nationalised bank FD. Considering the fact that your kid may enter higher education in 3 years it is not apt to subject it to market vagaries.

2. If you are prepared to hold your lumpsum investments for 5 year+ horizon then no need to worry about short term negative return.

3. Monthly sip's and NPS investments look good.

Happy Investing;
X: @mars_invest