Sir, i am 36 years old. Every month my take home salary is 70000. Already i am investment is 3500/- in sbi small cap on every month from last one year and i am in vesting 25000 in quant flexi cap, i had 1 crore term insurance and i want to retire at 45 years and how much corpus i will made?

Ans: To plan for retirement at 58 with a life expectancy of 100, considering your son's education and marriage expenses, as well as old-age medical costs, you would need a substantial corpus. A Certified Financial Planner can help calculate the exact amount based on various factors like inflation, expected returns, and lifestyle requirements. It's crucial to start investing strategically to achieve this goal, possibly through a mix of equity, debt, and other investment avenues. Regularly reviewing and adjusting your plan will ensure you stay on track to meet your retirement objectives.

Ans: Approx 8 crore

Ans: To retire comfortably at 50 with a monthly expense equivalent to your current lifestyle, you might need a retirement corpus of around 6 to 7 crores. This estimate considers your monthly savings of 3 lakhs, rental income of 40K, and potential growth on investments. Consulting a Certified Financial Planner (CFP) can help you create a personalized retirement plan, calculate the exact corpus needed, and guide you on investment strategies to achieve your retirement goal in 6 years. It's essential to consider inflation, investment returns, and post-retirement expenses while planning.

Ans: At 32, you have a solid foundation with no liabilities, a home, and an office. With Rs. 20 lakhs in NSC, Rs. 19 lakhs in the share market, Rs. 20 lakhs in PPF, Rs. 25 lakhs in FDR, and Rs. 1 lakh in MFI, you’re on the right track. Your monthly expenditure is Rs. 1 lakh, and you can save Rs. 1 lakh monthly. Now, let's create a plan to help you retire by 50 with a comfortable corpus.

Understanding Your Financial Situation
Current Investments:

NSC: Rs. 20 lakhs
Share Market: Rs. 19 lakhs
PPF: Rs. 20 lakhs
FDR: Rs. 25 lakhs
MFI: Rs. 1 lakh
Monthly Savings:

Expenditure: Rs. 1 lakh
Savings: Rs. 1 lakh
Setting Retirement Goals
To retire by 50, you need a significant corpus to sustain your lifestyle. Here's how to determine your target corpus:

1. Estimate Retirement Expenses:

Your current monthly expenditure is Rs. 1 lakh. Considering inflation, expenses will rise over time. Let's assume an inflation rate of 6% per annum.

2. Duration of Retirement:

If you retire at 50 and live till 80, you need funds for 30 years.

3. Calculate Retirement Corpus:

We need to account for inflation-adjusted expenses and potential investment returns. A rough estimate suggests you might need around Rs. 10-12 crores.

Building Your Retirement Corpus
1. Maximize Existing Investments:

NSC: National Savings Certificate (NSC) offers fixed returns and is a safe investment. However, it lacks the potential for high growth.

Share Market: Your Rs. 19 lakhs in the share market can grow significantly if well-managed. Diversify your portfolio to balance risk and return.

PPF: Public Provident Fund (PPF) is excellent for tax-free, safe returns. Continue investing here for stable growth.

FDR: Fixed Deposit Receipts (FDR) provide security but lower returns. Consider shifting some funds to higher-yield investments.

MFI: Microfinance Institution (MFI) investments can be risky. Monitor closely and consider reallocating if needed.

2. Start SIPs in Mutual Funds:

Systematic Investment Plans (SIPs) in mutual funds are ideal for long-term wealth creation. Here’s why:

Disciplined Investing: SIPs ensure regular investments.
Rupee Cost Averaging: Invests across market cycles, reducing risk.
Compounding: Reinvested returns generate more returns.
Diversification: Spreads risk across various sectors.
Choosing the Right Mutual Funds:

Equity Funds: High returns, suitable for long-term goals. Invest 60-70% in diversified equity funds.
Debt Funds: Lower risk, stable returns. Invest 20-30% for stability.
Hybrid Funds: Mix of equity and debt. Invest 10-20% for balanced growth.
3. Regularly Review and Rebalance:

Monitor your investments to ensure they align with your goals. Review annually and rebalance if necessary to maintain your desired risk level.

Tax Planning
1. ELSS Funds: Equity-Linked Savings Scheme (ELSS) offers tax benefits under Section 80C. Continue or start investing for dual benefits of tax saving and equity growth.

2. PPF: Continue your PPF investments for tax-free, stable returns.

3. Other Instruments: Explore NPS and other tax-saving instruments to optimize your tax liability.

Insurance Planning
1. Life Insurance: Ensure adequate life insurance to cover liabilities and provide for dependents.

2. Health Insurance: Comprehensive health insurance is crucial to cover medical expenses and safeguard savings.

Education and Contingency Planning
1. Education Fund: If you plan to have children, start an education fund early. Consider child-specific mutual funds or a mix of equity and debt funds.

2. Emergency Fund: Maintain an emergency fund covering 6-12 months of expenses. Keep it in liquid funds or savings accounts for easy access.

Final Insights
Achieving a secure retirement requires disciplined planning and smart investing. Here’s a summary of your action plan:

Action Plan Summary:
1. Evaluate Current Investments: Review NSC, share market, PPF, FDR, and MFI investments.

2. Start SIPs: Invest Rs. 1 lakh monthly in a mix of equity, debt, and hybrid funds.

3. Maximize Tax Benefits: Utilize ELSS, PPF, and other tax-saving instruments.

4. Ensure Insurance Coverage: Adequate life and health insurance.

5. Build Education and Emergency Funds: Separate funds for children’s education and emergencies.

6. Regular Review: Annually review and rebalance your portfolio.

By following this comprehensive plan, you can build a robust retirement corpus and ensure a secure financial future.

Best Regards,

K. Ramalingam, MBA, CFP

Chief Financial Planner

www.holisticinvestment.in

Ans: Determining the Required Retirement Corpus

1. Assess Current Financial Situation:

Liabilities: You have liabilities of Rs. 2 crores.
Current Investments: Rs. 80 lakhs in PPF, Rs. 10 lakhs in MFI.
Monthly Expenditure: Rs. 2.5 lakhs.
Monthly Savings: Rs. 2 lakhs.
2. Estimate Retirement Corpus:

Future Monthly Expenses:

You need to estimate future monthly expenses considering inflation. Given the current expenditure of Rs. 2.5 lakhs, this amount will likely increase over time.
Income Replacement:

To retire comfortably, you should aim to replace your current monthly expenses with investment income.
Investment Growth:

Factor in the expected growth of your investments. Consider a mix of equity, debt, and other assets for a balanced portfolio.
3. Consider Inflation Impact:

Inflation Adjustment:
Inflation will erode the purchasing power of your savings. Regularly review and adjust your savings and investments to counter inflation.
4. Investment Strategy:

Diversify Investments:

Continue investing in diversified mutual funds. Actively managed funds can offer better returns compared to index funds.
Increase Savings:

With Rs. 2 lakhs in monthly savings, continue to invest wisely. Increase your savings as your financial situation improves.
Regular Review:

Regularly review your investment portfolio. Make adjustments based on performance and changing financial needs.
5. Estimate Retirement Corpus:

Retirement Savings Goal:

Based on your monthly expenditure and inflation, estimate the required retirement corpus. A general rule is to have 15-20 times your annual expenses as the retirement corpus.
Emergency Fund:

Maintain an emergency fund to cover unforeseen expenses. This should be separate from your retirement corpus.
6. Seek Professional Advice:

Consult a Certified Financial Planner:
Consider consulting a Certified Financial Planner for a personalized retirement plan. They can provide detailed calculations and tailored advice.
Final Insights

To retire by 50 with your current lifestyle, aim for a substantial retirement corpus. With Rs. 2 lakhs in monthly savings and investments, focus on building a diversified portfolio. Regularly review and adjust your investments to meet your future needs. Consult a Certified Financial Planner to ensure your retirement plan is robust and achievable.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in