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Ramalingam

Ramalingam Kalirajan  |6991 Answers  |Ask -

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

Ramalingam Kalirajan has over 23 years of experience in mutual funds and financial planning.
He has an MBA in finance from the University of Madras and is a certified financial planner.
He is the director and chief financial planner at Holistic Investment, a Chennai-based firm that offers financial planning and wealth management advice.... more
Asked by Anonymous - May 09, 2024Hindi
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I am 24 , just started earning 90k per month, just starting my career , no investments yet, my monthly spend is 40k , how to invest n how much to invest in vivid sectors so that I can retire early?

Ans: Building a Strong Investment Portfolio for Early Retirement
Start with a Financial Plan
Congratulations on starting your career and thinking about your financial future. Planning early can help you achieve financial independence and an early retirement.

Determine Your Investment Goals
First, clarify your investment goals. Since you aim to retire early, calculate how much you need to save to maintain your desired lifestyle. This will help guide your investment strategy.

Monthly Savings Plan
You earn ?90,000 per month and spend ?40,000, leaving ?50,000 for savings and investments. A disciplined approach will help you maximize your returns.

Emergency Fund
Before investing, create an emergency fund. Save at least six months’ worth of expenses (?2.4 lakhs). This fund should be kept in a liquid savings account or short-term fixed deposits for easy access.

Diversified Investment Portfolio
1. Mutual Funds
Start with mutual funds to benefit from professional management and diversification. Allocate a significant portion of your savings here. Focus on actively managed funds to potentially achieve higher returns compared to index funds.

Equity Funds: Invest in large-cap, mid-cap, and small-cap funds for growth. These funds can offer high returns over the long term.

ELSS (Equity Linked Savings Scheme): These funds provide tax benefits under Section 80C. They have a lock-in period of three years but can offer good returns.

2. Systematic Investment Plan (SIP)
Invest through SIPs in mutual funds. This approach ensures disciplined investing and helps in averaging out the investment cost over time. Start with a monthly SIP of ?30,000 across different funds.

3. Public Provident Fund (PPF)
PPF is a safe and tax-efficient investment option. It offers good returns with tax benefits under Section 80C. Consider investing ?5,000 per month in PPF.

4. National Pension System (NPS)
NPS is a government-backed retirement savings scheme. It offers tax benefits and a disciplined approach to retirement savings. Allocate ?5,000 per month to NPS.

5. Stocks
Direct equity investment can provide substantial returns but comes with higher risks. Start small, with ?5,000 per month, and gradually increase as you gain experience. Focus on fundamentally strong companies with long-term growth potential.

6. Gold
Gold can act as a hedge against inflation. Invest in gold bonds or gold ETFs instead of physical gold. Allocate ?2,000 per month.

Monitor and Review
Regularly monitor your investment portfolio. Review your investments every six months to ensure they align with your goals. Adjust allocations based on performance and changes in your financial situation.

Financial Discipline and Learning
Maintain financial discipline by sticking to your investment plan. Continuously educate yourself about personal finance and investments. Consider consulting with a Certified Financial Planner (CFP) to get personalized advice.

Conclusion
By starting early and investing wisely, you can build a substantial corpus for early retirement. Diversify your investments across mutual funds, PPF, NPS, stocks, and gold. Maintain financial discipline and review your portfolio regularly to stay on track with your goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
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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Ramalingam

Ramalingam Kalirajan  |6991 Answers  |Ask -

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

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Sir i am 27 yrs old unmarried .i have 35L in FD 10L in ppf 15L in mutual fund 20L in stocks 5L in SGB . I have an annually income of 30L i want to retire by 40 i have brought a term insurance and health insurer. Can help me plan how to invest further and achieve my goal .Karthik banglore
Ans: Hello Karthik,

Firstly, congratulations on being proactive about planning for your retirement at such a young age. Let's delve into crafting a strategic financial plan to help you achieve your goal of retiring by the age of 40, with a focus on mutual funds (MFs) as a key component of your investment strategy.

Current Financial Position
Your current financial standing reflects a commendable level of savings and investments, providing a solid foundation for your retirement aspirations. Let's review your existing assets:

FDs, PPF, and SGB: These traditional investment avenues offer stability and security, but they might not maximize long-term growth potential.

Mutual Funds and Stocks: Investing in equities and mutual funds demonstrates your willingness to explore avenues with higher growth potential, albeit with associated market risks.

Retirement Planning Strategy
Given your ambitious retirement goal, here's a tailored approach to further optimize your investments, focusing more on mutual funds:

Asset Allocation Review:

Evaluate your current asset allocation to ensure alignment with your retirement timeline and risk tolerance. Consider reallocating a portion of your conservative investments (FDs, PPF) towards equity mutual funds for higher growth potential over the long term.
Diversification with Mutual Funds:

Explore a diversified portfolio of mutual funds across different categories:
Large-Cap Funds: These funds invest in large, well-established companies with stable performance. They offer relatively lower risk compared to mid-cap and small-cap funds.
Mid-Cap and Small-Cap Funds: These funds focus on mid-sized and small-sized companies with higher growth potential but also higher volatility. Allocate a portion of your portfolio to these funds for capital appreciation.
Flexi Cap Funds: These funds provide flexibility to invest across market capitalizations based on prevailing market conditions. They offer a balanced approach between growth and stability.
ELSS Funds: Consider investing in Equity Linked Savings Schemes (ELSS) to avail tax benefits under Section 80C of the Income Tax Act, while also benefiting from potential capital appreciation.
Regular Portfolio Monitoring:

Implement a disciplined approach to monitor and rebalance your MF portfolio periodically. Review fund performance, expense ratios, and fund manager track records to ensure they align with your investment objectives.
Systematic Investment Plan (SIP):

Utilize SIPs to invest systematically in mutual funds, enabling rupee-cost averaging and mitigating the impact of market volatility over time. Allocate your monthly investment amount across various MF categories based on your risk profile and investment horizon.
Tax Planning:

Optimize your tax efficiency by leveraging tax-saving mutual fund options such as ELSS funds. Maximize contributions to tax-deferred accounts like ELSS to reduce your taxable income and enhance overall savings.
Conclusion
In conclusion, by adopting a proactive and strategic approach to your financial planning, with a focus on mutual funds, you're well-positioned to achieve your goal of retiring by the age of 40. Continuously assess and adjust your MF portfolio to align with evolving market conditions and personal financial objectives. Remember, early retirement requires diligent planning and disciplined execution, but with careful guidance and prudent decision-making, you're on the right track to realizing your retirement dreams.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |6991 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jun 23, 2024

Asked by Anonymous - Jun 23, 2024Hindi
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I am 34 year old my salary is 30000, wife is house wife, have 2 daughters 8year and 2 year old one son 6 year old, i can invest 8000 per month now, how i should invest so i can manage my kids studies and other expenses with making some retirement fund also. In future as my salary will increase i can increase investment.
Ans: Managing your finances with a focus on your kids' education and your retirement is commendable. Let’s dive into a detailed plan tailored for you.

Understanding Your Financial Goals
Your primary goals seem to be:

Ensuring a secure and quality education for your three kids.
Building a retirement corpus for a comfortable future.
Managing current expenses effectively while saving for future needs.
Each goal needs a specific strategy to ensure balanced growth and security.

Evaluating Your Current Financial Situation
With a salary of Rs 30,000 and a housewife spouse, it's essential to optimize your Rs 8,000 monthly savings. Your family responsibilities require prudent planning and disciplined saving habits.

Importance of a Diversified Portfolio
Investing across various assets is crucial. A diversified portfolio minimizes risk and maximizes returns. Let’s break down how you can allocate your Rs 8,000 monthly investment.

Prioritizing Emergency Fund
Before diving into investments, an emergency fund is vital. Aim to save 3-6 months' worth of expenses. This cushion will protect you from unexpected financial disruptions.

Building a Children's Education Fund
Education costs rise every year. Start a dedicated fund for each child’s education. Equity mutual funds are a strong option here due to their potential for high returns over a long period. While equity funds are volatile in the short term, they tend to outperform other asset classes in the long term.

Benefits of Actively Managed Equity Funds:

Professional management ensures informed investment decisions.
Potential for higher returns compared to passive index funds.
Active managers can navigate market volatility better.
Disadvantages of Index Funds:

Lack of flexibility in stock selection.
Possible underperformance in volatile markets.
Limited ability to react to market changes.
Planning for Retirement
Retirement planning should not be delayed. A systematic investment in mutual funds can create a substantial corpus. Since you have a long investment horizon, equity funds are suitable for this goal too.

Choosing Regular Funds Over Direct Funds
While direct funds have lower expense ratios, regular funds offer advantages through the guidance of a Certified Financial Planner (CFP). Regular funds come with:

Professional advice tailored to your financial goals.
Assistance in portfolio rebalancing.
Guidance during market volatility.
Insurance: Protection First
If you hold LIC, ULIP, or other investment-cum-insurance policies, it might be beneficial to surrender these and reinvest the proceeds into mutual funds. Pure term insurance is a better option for financial protection without the high costs of investment-linked insurance plans.

Systematic Investment Plan (SIP) Strategy
A SIP is an excellent way to invest consistently. Here’s a proposed allocation for your Rs 8,000 monthly investment:

Children’s Education Fund: Rs 4,000
Retirement Fund: Rs 3,000
Emergency Fund: Rs 1,000
As your salary increases, you can proportionally increase these investments.

Regular Review and Rebalancing
Financial planning is not a one-time activity. Regularly review your portfolio and rebalance it to align with your goals. A CFP can assist in these reviews and make necessary adjustments.

Tax Planning and Benefits
Investments in certain mutual funds offer tax benefits under Section 80C. Equity Linked Savings Schemes (ELSS) are mutual funds that provide tax deductions and have the potential for higher returns.

Importance of Discipline and Patience
Investing is a long-term commitment. Stay disciplined with your SIPs and avoid withdrawing funds unless absolutely necessary. Patience is key to achieving your financial goals.

Final Insights
To summarize:

Start with an emergency fund for financial security.
Allocate funds to children’s education and your retirement.
Opt for actively managed mutual funds over index funds.
Consider regular funds with professional guidance over direct funds.
Review and adjust your portfolio regularly with a CFP’s help.
Take advantage of tax-saving investment options.
With disciplined saving and informed investment decisions, you can secure your children’s future and build a comfortable retirement corpus.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |6991 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 17, 2024

Asked by Anonymous - Jun 24, 2024Hindi
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I am 26 years old and i work in an IT company . My monthly salary is 1 lakh as of now .I have 4.4 lakh in mutual fund , 2.4 lakh in PF , 1.67 lakh in PPF and 2.5 lakh of shares . I need to retire around the age of 40 which is 14 years from now with a corpus of 3-4 cr . Please advice me how should i invest so i reach that amount.
Ans: You are 26 years old and work in an IT company.

Your monthly salary is Rs. 1 lakh.

You want to retire at 40, 14 years from now, with a corpus of Rs. 3-4 crores.

Current Financial Situation

You have Rs. 4.4 lakhs in mutual funds.

You have Rs. 2.4 lakhs in PF.

You have Rs. 1.67 lakhs in PPF.

You have Rs. 2.5 lakhs in shares.

Setting a Realistic Plan

To reach Rs. 3-4 crores in 14 years, disciplined investing is key.

Assuming a mix of equity and debt investments.

Monthly Savings and Investments

Save and invest a significant portion of your salary.

Aim to invest 30-40% of your salary monthly.

This means investing Rs. 30,000 to Rs. 40,000 each month.

Choosing the Right Investments

Equity Mutual Funds

Equity funds offer high growth potential.

Consider large-cap, mid-cap, and small-cap funds.

Allocate around 60-70% of your investments here.

Hybrid Mutual Funds

Hybrid funds balance risk and reward.

They invest in both equity and debt.

Allocate around 20-30% of your investments here.

Debt Mutual Funds

Debt funds provide stability and regular income.

Allocate around 10-20% of your investments here.

Avoiding Index Funds

Index funds track the market passively.

They lack active management and can limit returns.

Actively managed funds can outperform index funds.

Disadvantages of Direct Funds

Direct funds may seem cheaper but need expertise.

Regular funds, through a Certified Financial Planner, offer professional management.

They provide personalized advice and ongoing support.

Systematic Investment Plans (SIPs)

Use SIPs for disciplined investing.

Invest a fixed amount regularly to average out market volatility.

Diversify Investments

Diversify your portfolio to reduce risk.

Include a mix of equity, hybrid, and debt funds.

Tax Efficiency

Equity mutual funds are tax-efficient for long-term gains.

Consider tax-saving funds under Section 80C for additional benefits.

Regular Review and Adjustment

Review your portfolio regularly.

Adjust allocations based on performance and goals.

Seek advice from a Certified Financial Planner for tailored strategies.

Final Insights

To achieve your goal of Rs. 3-4 crores, disciplined saving and investing are crucial.

A mix of equity, hybrid, and debt funds can balance growth and stability.

Regular reviews and professional advice will help you stay on track.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |6991 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 04, 2024

Asked by Anonymous - Jun 30, 2024Hindi
Money
I am 36 year old my salary is 75000, wife is house wife, have one son 6 year old, i can invest 30000 per month now, how i should invest so i can manage my kid studies and other expenses with making some retirement fund also. In future as my salary will increase i can increase investment.
Ans: It’s wonderful that you’re considering your family’s future and making a plan for your child’s education and your retirement. Let’s break down a comprehensive strategy for you.

Understanding Your Financial Goals
You have a clear goal to manage your child’s education and build a retirement fund. Investing Rs 30,000 per month is a great start. Let’s structure a plan that balances both objectives.

Investment Strategy Overview
You’re 36 years old, earning Rs 75,000 per month, and planning to invest Rs 30,000 monthly. Here’s how you can allocate your investments effectively.

Diversification: The Key to Balanced Growth
Diversification helps in spreading risk across various assets. By diversifying your investments, you can achieve growth and stability. Here's how you can do it:

Equity Mutual Funds
Equity mutual funds are ideal for long-term growth. They invest in stocks, which can offer high returns. Here are some options:

Large-Cap Funds: These invest in well-established companies. They offer stable growth with lower risk.
Mid-Cap Funds: These invest in medium-sized companies. They have higher growth potential but come with moderate risk.
Small-Cap Funds: These invest in small companies. They offer high growth but are riskier.
Multi-Cap Funds: These invest in companies of all sizes. They provide diversification within equities.
Debt Mutual Funds
Debt mutual funds invest in fixed-income securities like bonds. They offer stable returns with lower risk. Here are some options:

Short-Term Debt Funds: Suitable for stability and liquidity.
Medium-Term Debt Funds: Offer better returns with moderate risk.
Long-Term Debt Funds: Suitable for long-term goals, providing higher returns with interest rate risk.
Balanced Funds
Balanced funds, also known as hybrid funds, invest in both equities and debt. They offer a balanced approach, providing growth and stability.

Allocating Your Monthly Investment
Here’s a suggested allocation for your Rs 30,000 monthly investment:

Equity Funds: Rs 18,000 (60%)
Debt Funds: Rs 9,000 (30%)
Balanced Funds: Rs 3,000 (10%)
This allocation balances growth potential with risk management.

Investing for Your Child’s Education
Your child’s education is a major goal. Planning ahead ensures you can meet future expenses. Here’s how you can do it:

Child Education Fund
Start a dedicated child education fund. Invest in equity mutual funds for long-term growth. Consider the following:

Equity Funds: Allocate a significant portion to large-cap and multi-cap funds. These offer stable growth over the long term.
SIP (Systematic Investment Plan): Invest a fixed amount regularly. SIPs help in averaging the cost and benefit from market fluctuations.
Regular Monitoring
Review the fund performance regularly. Adjust the investment strategy as needed to ensure it stays on track.

Building a Retirement Corpus
Planning for retirement early ensures you build a substantial corpus. Here’s how you can do it:

Retirement Fund
Start a dedicated retirement fund. Diversify across equity, debt, and balanced funds. Consider the following:

Equity Funds: Allocate to large-cap and multi-cap funds for growth.
Debt Funds: Allocate to short-term and medium-term debt funds for stability.
Balanced Funds: Allocate a small portion to balanced funds for a mix of growth and stability.
Power of Compounding
The power of compounding is a key factor in building your retirement corpus. The longer you stay invested, the more your money grows.

Managing Risk
Investing involves risk. Here’s how to manage it effectively:

Diversification
Diversifying across various asset classes and fund types reduces risk. This ensures poor performance in one area is offset by better performance in another.

Regular Reviews
Regularly review your investments. Adjust your strategy based on market conditions and personal goals.

Emergency Fund
Maintain an emergency fund. This ensures you don’t need to liquidate your investments during emergencies.

Increasing Investments with Salary Hikes
As your salary increases, you can increase your investments. Here’s how to plan for it:

Incremental Investments
Increase your monthly investments proportionally with your salary hikes. This boosts your investment corpus significantly over time.

Rebalancing
Rebalance your portfolio regularly. Ensure your asset allocation aligns with your risk tolerance and financial goals.

Monitoring and Adjusting Your Strategy
Regular Monitoring
Monitor your investments every six months. Check fund performance and adjust your investments as needed.

Annual Review
Conduct a comprehensive review annually. Rebalance your portfolio to align with your changing financial goals and market conditions.

Final Insights
Your commitment to investing Rs 30,000 per month for your child’s education and retirement is commendable. By diversifying your investments across equity, debt, and balanced funds, you balance growth and stability.

Regular monitoring, rebalancing, and increasing investments with salary hikes ensure you stay on track to achieve your goals. Investing through a Certified Financial Planner ensures you get personalized advice tailored to your needs.

Your disciplined approach and strategic planning will lead you to a secure financial future for your family. Stay committed, stay informed, and keep your long-term goals in sight.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Latest Questions
Anu

Anu Krishna  |1287 Answers  |Ask -

Relationships Expert, Mind Coach - Answered on Nov 08, 2024

Asked by Anonymous - Nov 07, 2024Hindi
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Relationship
Hi Anu Mam Im 27 yrs old ( married) and 10 yrs old daughter. Im seperated from my husband since 2 yrs due to several reasons like he is drinking and Totally addicted to it. And he is totally dependent and now today also roaming on the roads of some streets of hyd. I belongs to an orthdox family. Now the question is one backward caste man who is married age : 33 he is interested in me and proposed me to a marriage after knowing all my past and saying that he accepts my child too. And the thing is he said a lie to me at first that he is unmarried and even though i had a good impression on him about the way he behaves with me he even treat me in a very polite manner. He says he loves me even though i too had a good impression but the things are the castes and can we both settle down with a marriage can we be happy or he is only trying to convince me to get him a wife to care care of him or only for his parents, he always talks about his own sister and also the office colleagues calls them sister and get emotional about them those who left the office. And he cries a lot which i dont trust on him and the face i see him that was not an real cry that looks like an act which i dont like in him. May he is acting ? Or really loving me, ge cares alot i feel like he is over reacting
Ans: Dear Anonymous,
If you are in doubt, then it's highly likely that he is putting on an act. Go with your intuition and hey hey, you said that he is married and so are you...You do realize that you just can't go ahead and marry while you are already to other people, right?
Focus on what's happening in your life; you obviously have to do something about it...Other relationships can wait!

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

...Read more

Anu

Anu Krishna  |1287 Answers  |Ask -

Relationships Expert, Mind Coach - Answered on Nov 08, 2024

Asked by Anonymous - Nov 06, 2024Hindi
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Relationship
Hello Ms Anu, I am a 42yr female..married since 14 yrs and have 10yr old son . I am highly qualified and financially independent. My marriage was a arranged one.. but in these 14 yrs.. I never experienced love or and attachment from my husband's side. He is a family man.. there is no other woman involved..He loves his parents and his two sisters immensely... but always treats me as a option. I feel humiliated and lonely and he has short temper when i talk about this issue... so basically I don't discuss... but that is no solution... I am suffering and unhappy. What should I do?
Ans: Dear Anonymous,
A few married men can be more focused on the women on their side of the family; it becomes easy to express love, care and attention to them as he has grown with them.
A wife happens to be someone that he is yet to understand. It requires effort to make a marriage work; your husband finds it convenient to take the easy way out and 'hang out' with his family.
So, here you take the lead and start. Start not by bringing forth your complaints as this is going to push him further to them which is going to annoy you BUT by inviting him to be with you. A lot of work, I get it...but the bottom line: that's what you want, right?
Plan dates evenings, take short vacations together, work-out together...the key is to establish a connection which never had its chance in the first place...So, give your best shot! Most times actions speak louder than words ever can...

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

...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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