I am 29 right now. I am getting in hand salary of Rs 50,000. I am investing Rs 10,000/month in mutual fund in 6 different AMCs, Rs 3500/month in recurring deposit, Rs 2000/month in NPS account. I gave Rs 2000/month to my mother. Just completed my two-wheeler loan of Rs 4061/month. I have one PPF account but for last few months I couldn't deposit in it. I have also an emergency fund but for last few months I couldn't deposit. Help me to plan for a perfect balance in savings and expenditure.

Ans: Understanding Your Current Financial Position

You are 29 and earning Rs 50,000 monthly. That’s a good start.

Your current commitments are well spread. Let us list them:

Rs 10,000 into mutual funds (6 AMCs)

Rs 3,500 into recurring deposit

Rs 2,000 into NPS

Rs 2,000 given to your mother

Two-wheeler loan is now completed

You have a PPF account but not active now

You had an emergency fund but paused contributions

It shows you are aware about financial responsibility. That is the first strong step.

Now let us bring better structure and balance to your cash flow.

Step 1: Know Your Monthly Outflow Clearly

From Rs 50,000 in hand, your key fixed outgo:

Mutual Funds: Rs 10,000

RD: Rs 3,500

NPS: Rs 2,000

Mother: Rs 2,000

This totals Rs 17,500 per month. That’s 35% of your salary.

Remaining Rs 32,500 is used for all your expenses.

This seems okay but needs tweaking for better stability.

Step 2: Emergency Fund Needs Priority

You had started one. That’s good.

But it must be a consistent part of your plan.

Emergency fund is your first line of protection.

It gives you peace in tough times like job loss or medical needs.

Ideal size is 6 months of your monthly expenses.

Assume your basic expenses are Rs 20,000. You must build Rs 1.2 lakh.

If paused earlier, restart with Rs 2,000 monthly.

Even Rs 1,000 monthly is okay if money is tight.

Keep this in bank RD or sweep-in FD for liquidity.

Avoid mutual funds for emergency money.

Do not invest this in PPF or NPS.

This is not for returns. This is for safety.

Step 3: PPF Is a Long-Term Habit, Restart It

PPF is a 15-year investment. It gives tax-free returns.

Even if returns are low, it builds stable corpus.

You missed a few months. That’s okay.

Restart it with Rs 500 monthly. Try to go up to Rs 1,500 slowly.

Do not miss yearly deposit of Rs 500 minimum.

If you can do Rs 12,000 yearly, that’s Rs 1,000 monthly.

Put a reminder in your mobile to invest monthly.

Use online transfer or auto-debit to make it easy.

Step 4: Mutual Fund Investments – Needs Some Cleanup

You are investing Rs 10,000 in six different AMCs.

That’s too much diversification.

It leads to overlapping holdings and confusion.

More funds does not mean better returns.

You are also young, and can take moderate equity exposure.

But spreading Rs 10,000 into six funds reduces growth.

Instead, limit it to 3 funds.

Choose one flexi-cap, one mid-cap, one ELSS or balanced fund.

Avoid index funds. They mirror market and fall with market.

They don’t protect downside.

Actively managed funds have human control.

They try to avoid poor-performing sectors.

Certified Financial Planners prefer well-managed active funds.

Also, prefer regular plans through MFDs with CFP credentials.

Why?

Because they guide you, track your goal, rebalance funds.

In direct plans, no expert support. You do all tracking.

That leads to mistakes, panic exits, wrong timing.

Take support from a trusted MFD who works with a CFP.

Cut your current list of 6 mutual funds.

Shift SIPs into 2 or 3 quality funds only.

Ask your MFD to run a portfolio overlap check.

Too many AMCs confuse your asset allocation.

Step 5: Recurring Deposit – Review Its Need

RD of Rs 3,500 is fine if for short goals.

But if it is just habit, we must rethink.

RD interest is taxable. Inflation reduces real return.

So only keep this if goal is within 1 year.

If not, shift part of this into hybrid mutual fund SIP.

Keep RD only for short-term goals.

Split like this:

Rs 1,500 for RD

Rs 2,000 shifted to hybrid or flexi-cap mutual fund

This improves long-term returns without much risk.

Talk to your CFP-backed MFD for right scheme.

Step 6: NPS – Small Start, Big Benefit

You are investing Rs 2,000 per month in NPS.

That’s a very good habit.

It gives you tax benefit and retirement corpus.

Don’t stop this. Try to increase this to Rs 3,000 per month after 1 year.

NPS is good for disciplined retirement saving.

You can also split equity-debt inside it.

But don’t treat NPS like emergency or medium-term investment.

It is locked till 60 years.

Use only for retirement, not for other goals.

Step 7: Regular Help to Parents Is A Blessing

Rs 2,000 to your mother is a noble deed.

You must continue this.

This is your non-financial return in life.

Budget this as fixed.

If needed, cut some lifestyle cost but don’t cut this.

Try to include it in your personal budget like EMI.

Step 8: Two-Wheeler Loan Closed – Use That Gap Wisely

You were paying Rs 4,061 EMI. Now loan is over.

That money must not be spent on online shopping or food.

Use it wisely.

Split this Rs 4,061 like this:

Rs 1,000 into PPF

Rs 1,000 into Emergency fund

Rs 2,061 into Mutual Fund SIP or NPS

This will make a big impact in 5 years.

Never leave this surplus idle in savings account.

Build this into your new investment routine.

Step 9: Budgeting and Monthly Expense Review

Now let us talk about overall monthly cash flow plan.

Rs 50,000 is your take home. Try this revised structure:

Rs 10,000 in Mutual Fund SIP (3 funds only)

Rs 2,000 in NPS

Rs 1,500 in PPF

Rs 1,500 in RD

Rs 2,000 to Mother

Rs 2,000 in Emergency Fund

Rs 2,000 from bike loan EMI moved to SIP

Rs 1,000 as contingency buffer

Rs 28,000 for monthly expenses

Total = Rs 50,000

This is a balanced setup. All areas are covered.

You save around 40%. That is very good.

Expenses at 60% are manageable.

Adjust this if bonus or hike happens.

Step 10: Keep Personal Insurance Updated

You didn’t mention term insurance.

If you have dependents, get a term plan.

Sum assured should be minimum Rs 50 lakh.

Premium will be low if you take it early.

Also take personal health cover of Rs 5 lakh.

Company health cover is not enough.

If you lose job, you also lose health cover.

Buy own policy and renew it yearly.

These 2 insurances are must:

Term insurance (pure protection)

Personal health insurance (non-employer based)

Avoid ULIP, endowment, LIC-type policies.

If you already have LIC-type policy, review it.

If returns are low and cover is small, better to exit.

Reinvest in mutual fund and term plan.

But only if you already hold such policies.

Step 11: Monitor and Rebalance Every Year

Every March, check your investments.

Are you on track?

Did your SIPs run on time?

Did you miss PPF deposit?

Any new expense that needs fund?

Use a small Excel sheet to track this.

Or use free mobile apps to manage money.

Ask your CFP-backed MFD to run portfolio review once a year.

Rebalancing helps protect gains.

Without rebalancing, portfolio goes off track.

Step 12: Goal-Based Investing for Future

You are 29 now. Think of future goals.

Some may be:

House purchase in 8 years

Marriage expenses

Retirement at 60

Foreign trip in 3 years

List all these goals.

Split them into short, medium, and long term.

Now attach each goal to a product:

Short-term: RD, Liquid fund

Medium-term: Hybrid funds, Flexi-cap

Long-term: Equity mutual funds, NPS, PPF

This gives clarity.

Avoid mixing products and goals.

Emergency fund is not travel fund.

PPF is not for house down payment.

Discipline gives success.

Finally

You are already on the right path.

But too many mutual funds and missed deposits create imbalance.

Now you must simplify.

Clean your mutual fund list.

Restart your PPF and emergency fund.

Use your freed EMI smartly.

Build insurance if not already done.

Track your money monthly. Review yearly.

Don’t chase returns. Build habit.

Get help from Certified Financial Planner-backed MFDs.

They help in goal planning, portfolio review, risk check.

This is your age to grow wealth.

Small steps today make big results tomorrow.

Be consistent and focused.

Avoid distractions like direct equity or new-age products.

Stick to time-tested plans and keep growing.

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