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Sunil

Sunil Lala  |173 Answers  |Ask -

Financial Planner - Answered on Feb 26, 2024

Sunil Lala founded SL Wealth, a company that offers life and non-life insurance, mutual fund and asset allocation advice, in 2005. A certified financial planner, he has three decades of domain experience. His expertise includes designing goal-specific financial plans and creating investment awareness. He has been a registered member of the Financial Planning Standards Board since 2009.... more
Sagar Question by Sagar on Dec 01, 2023Hindi
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1. I'm a Govt employee with a salary of 1.3L per month. My age is 31. 2. My current investments are :- a. 12L in stocks (70 % in small cap, 30% in large cap) b. 4L in PF. 3. I contribute 30K every month directly into stock mkt and 10K per month in PF. 4. Can you please suggest me :- a. How much of a corpus should I have by 45 years of age, so that I can get around 1-1.2 L per month from the internet. b. With current income, should I go for a home loan of 60L or should I consider lesser amount? Thanks

Ans: You should have a Corpus of 2 to 2.4 crore by the age of 45 and you can go ahead with the home loan of 60 Lakh
DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.
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Sanjeev

Sanjeev Govila  |458 Answers  |Ask -

Financial Planner - Answered on Dec 25, 2023

Asked by Anonymous - Dec 16, 2023Hindi
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Hi, I'm 31 years old and married. She is a housewife. I have about 30 lakhs in FDs and PPFs. I have loan-free farm land of 35 lakhs, highway touch, which yields only 20k per year in rent right now. I have home loan of 38 lakhs with 33500 EMI. I have just recently started investing in MFs with SIP of 9000 per month in 5-6 different funds comprising of large cap, mid cap, small cap, dividend yield and I want to increase it. I only prefer equity oriented funds because of its higher returns as compared to debt funds as I already have enough FDs to play safely and thus I avoid debt funds. I know I have enough years to gather large corpus till age 60. But right now, please suggest me how much (or how much more) and where should I invest Rs.50000 per month (savings of my salary after all expenses per month) so that I earn exactly Rs.1 lakh per month from all my investments (passive income) in exactly 5 years from now. Also, I wonder if I should pay off my home loan or not coz one side is that currently I avail tax return on interest component upto 3.5 lakhs but the other side is that paying off home loan will lessen my mental burden. So sir, please share your valuable opinion om both these points.
Ans: To be honest, increasing your SIP to 50,000 per month would only accumulate around 40 lakhs in five years. While this might allow you to withdraw 1 lakh per month through a Systematic Withdrawal Plan (SWP), this income stream would only last for four years, as the underlying corpus wouldn't be large enough to sustain it for a decade.

On your investment, we recommend sticking with your diversified SIPs and maybe exploring some specific funds for that extra growth potential. But remember, balance is the key. To counter market volatility and generate some regular income, consider putting 20-30% of your additional investment into hybrid or balanced funds.

You can review your FD allocations to find a sweet spot between higher returns and keeping some available cash for contingency purpose.

Talking about the home loan, weighing the tax benefit with the mental freedom of paying it off is a personal decision. You should compare different scenarios based on your tax bracket, new and old tax regime, and future income growth and future plans. Based on analysis you can consider a partial prepayment to reduce the loan tenure and interest.
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Ramalingam

Ramalingam Kalirajan  |637 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 08, 2024

Asked by Anonymous - Apr 08, 2024Hindi
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Dear Sir, My inhand salary is approx 1 Lac per month. My wife's salary in hand is 60k per month. We have a kid of 1 year now. Our goal is to create a corpus amount of 4Crores for Childs education and well being. Current investments are 1. Equities-20 Lacs, Mutual Funds Quant, parikh, sbi, 5 Lacs total. Ppf 10 Lacs, Nps 2 Lacs, My requirements are 1. Need amount of 4 Cr at 2040 2. Currently I need best Term plan to invest in with cover of 3Cr 3. Need to know best health insurance for any medical emergency with family cover of 25Lacs. 4. Need to Buy a Home of 1.5 Cr 2bhk for which I will be going for Home loan of minimum 60Lacs. 5. Risk appetite medium to high
Ans: Given your financial goals and risk appetite, here are some recommendations:

Investments:

Continue investing in equity through mutual funds for long-term wealth creation.
Consider increasing your equity exposure gradually, given your high risk tolerance.
Regularly review and rebalance your investment portfolio to ensure alignment with your goals and risk tolerance.
Term Insurance:

Look for reputable insurance providers offering term plans with coverage of at least 3 Crores.
Compare premiums, features, and claim settlement ratios before making a decision.
Consider opting for a policy with a rider for critical illness coverage for added protection.
Health Insurance:

Choose a comprehensive family health insurance plan with a coverage of 25 Lakhs.
Look for plans that offer coverage for hospitalization, pre-existing conditions, day care procedures, and maternity benefits.
Consider factors such as network hospitals, claim settlement process, and premium affordability.
Home Purchase:

Since you plan to buy a home worth 1.5 Crores and avail a home loan, ensure that the EMIs are comfortably manageable within your monthly budget.
Compare home loan offers from various banks and financial institutions to get the best interest rates and terms.
Factor in additional costs such as registration fees, stamp duty, and maintenance expenses while budgeting for the purchase.
Financial Planning:

Consult with a certified financial planner to create a comprehensive financial plan tailored to your specific goals, risk tolerance, and financial situation.
Regularly review your financial plan and make adjustments as needed based on changes in your circumstances or market conditions.
By implementing these strategies and regularly monitoring your progress, you can work towards achieving your financial goals while managing risk effectively.
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Ramalingam

Ramalingam Kalirajan  |637 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 20, 2024

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hi sir : my son doing job since two year monthly earning is 60 K. but his saving is nil. pl. advice where to invest
Ans: It's great that your son has started earning, and it's essential to guide him on saving and investing for the future. Here's a step-by-step investment plan tailored for him:

Emergency Fund: Start by building an emergency fund equivalent to 3-6 months of expenses. This fund should be easily accessible, like a savings account or a liquid fund.
Debt Repayment: If he has any high-interest debts like credit card bills or personal loans, it's wise to clear those first to avoid paying hefty interest.
Investment Options:
Equity Mutual Funds: For long-term wealth creation, he can start SIPs in diversified equity funds. A mix of large-cap, mid-cap, and multi-cap funds can provide growth.
PPF (Public Provident Fund): A tax-efficient and safe option for long-term savings with a lock-in period of 15 years.
NPS (National Pension System): A retirement-focused investment with tax benefits, offering a mix of equity, corporate bonds, and government securities.
Term Insurance: Since he's working, consider getting a term insurance plan to ensure financial security for his dependents.
Health Insurance: A comprehensive health insurance plan to cover medical emergencies can provide financial security and tax benefits.
Budgeting and Savings: Encourage him to create a monthly budget to track expenses and identify areas to save. Automating investments through SIPs can also help in disciplined saving.
Financial Education: Educate him about the importance of financial planning, saving, and investing. Encourage him to read books or attend workshops on personal finance.
Starting early with disciplined saving and investing can help him build a substantial corpus over time. Encourage him to consult a financial advisor for personalized guidance tailored to his financial goals and risk tolerance.
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Ramalingam

Ramalingam Kalirajan  |637 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 20, 2024

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Hi Anil, I am 43 years old. I have a monthly sip of 35k going on. I have started investing in mutual fund and sip from year 2013. Total mutual fund plus sip current market value is 1 core 9 lakhs . I plan to invest 35 k per month more for 7 to 8 years , when i want to leave job and do something else. Can you tell me what will be my corpus in 7 to 8 years down the line taking both current valution plus what i am going to continue investing?Also, i have another 1 corore total in other investment like Voluntary provident fund, Epf, ppf and esops from my company and pension fund . Here i do a monthly investment of around 80 k via mostly through company for tax savings. So what will be my total corpus after 7 to 8 yrs. Also, is it good for retirement considering my current monthly expense us 1 lakh.
Ans: To estimate your corpus after 7 to 8 years, let's assume an average annual return on your mutual fund SIPs at 10-12% and a similar return on your other investments.

For Mutual Funds:

Future Value of Current Investments: Using the future value formula, considering an average return of 10-12%, your current 1.09 crore can grow to approximately 2.2 - 2.5 crores in 7-8 years.
Future Value of Additional SIPs: Investing 35k per month for 7-8 years, at an average return of 10-12%, you could accumulate around 50 - 60 lakhs from SIPs alone.
For Other Investments:

Future Value of Current Investments: Assuming an average annual return of 10-12%, your current 1 crore can grow to approximately 2 - 2.4 crores.
Future Value of Additional Investments: With 80k monthly investments for 7-8 years, at an average return of 10-12%, you could accumulate around 1.5 - 1.8 crores.
Total Corpus After 7-8 Years: Combining both, your total corpus could range from 5.2 - 6.2 crores.

Retirement Planning:
Considering your monthly expense is 1 lakh, with a corpus of 5.2 - 6.2 crores, you can generate approximately 40-50k per month (assuming a 7-8% withdrawal rate) post-retirement. This should be sufficient considering your current expenses, but inflation and unforeseen expenses should also be considered.

It's advisable to consult a financial advisor for a detailed plan tailored to your needs, considering inflation, tax implications, and other factors.
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Ramalingam

Ramalingam Kalirajan  |637 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 20, 2024

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Hello, I want to invest 10 lac INR for a long term investment. I need suggestion on the following, i understand to invest in the form of SIP. But want to get a suggestion on where should I invest this 10-20 lac first and then invest as an SIP over 1-2 years or even 3 years as per your suggestion. As currently lying in Savings account which doesnt yield more. Secondly I would need a help on good portfolio of funds for long term (10 years or above) for my retirement/younger child's education.
Ans: For long-term investments of 10-20 lakhs, you can consider the following approach:

Initial Lump Sum Investment:

Liquid Funds: Park a portion in liquid funds to earn better returns than a savings account while maintaining liquidity.
Short-term Debt Funds: Allocate to short-term debt funds for stability and moderate returns.
Long-Term SIP Portfolio:

Diversified Equity Funds: Invest in a mix of large-cap, mid-cap, and multi-cap equity funds through SIPs for growth potential.
Balanced Funds: Opt for balanced funds or aggressive hybrid funds for a blend of equity and debt, suitable for long-term wealth creation.
Child Education: Start a separate SIP in a child education-focused fund to ensure funds are available when needed.
Sample Portfolio for Long Term:

Large Cap Equity Fund: 30%
Mid Cap Equity Fund: 20%
Multi Cap Equity Fund: 25%
Balanced/Aggressive Hybrid Fund: 15%
Child Education Fund: 10%
Adjust the allocation based on your risk tolerance and financial goals. Regularly review and rebalance the portfolio to maintain desired asset allocation. Consulting a financial advisor can help create a personalized investment plan tailored to your needs and goals.
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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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