Hi, I am 36 years old. I am investing 60k per month in mutual funds as of 2024 with 5%step up every year. I started investing since 2018 with 8k per month sip and gradually increased the amount every year till i reached 60k per month in 2024. My current mutual fund portfolio is 63 lakh with a cagr of 22%. (100% equity mutual fund with equal distribution in large ,mid and small caps) It touched 67 lakh last month but due to recent fall it has lost clode to 4 lakh in one month. I intend to continue invest 60k with 5% increment till i am 50 years old. I also have a stock portfolio of 35 lakh. Ppf- 12.30 lakh (investing 50k yearly) Epf- 15.71(2.4 lakh yearly employer and employee combined) Us stock portfolio - 10k usd(casual investment) Gold - 2.5 lakh(casual investment) Nps - 3 lakh(2.5 lakh tier 1 and 50k tier 2) investing 50k annually in nps tier 1. I want to accumulate 10 cr in next 14 years when i turn 50. Please guide me on the changes needed in my approach. Thanks, Jimmy

Ans: Hello Dear
As far as the NRI quota is concerned, it is better to visit the official website of the said college or directly talk to the administration for more accurate and reliable information. The fee changes and varies institute-wise. If your daughter scores well, she can get admission to Pondicherry through CENTAC (CENTRALISED ADMISSION COMMITTEE). It is not clear why you are only focussing on Pondicherry. There are many colleges where your daughter can get admission through the NRI quota easily either in a college or a good private college. The flow of patients is almost the same to Govt and Pvt college.

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Thanks.

Radheshyam

Ans: Hello dear.
Here is the point-wise reply to your question:
(1) Visit any IIT website (i.e. IIT Delhi or Kanpur), and you will get the list of state-wise. or simply copy the following link and paste it into your browser: https://sites.google.com/d/1Jkk3M1VMmz-cAt9715bsTdB8_-HX3zhc/p/1tl1rYT3HOt1z5JjSkfujneMhN6FJCOpo/edit
(2) To become IITan, first crack JEE (Main) and then JEE (Adv). Get admission to IIT College based on your rank. Pass the course. Then you will be called/recognized as IITas.
(3) Cutoff varies from institution to institution and course-wise. It would be better to visit the Kanpur / Madras IIT websites to know the exact cutoff branch-wise.
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Radheshyam

Ans: Investing Rs 10 lakhs for your child’s education is a thoughtful decision.

Your child is 4 months old, so you have a long investment horizon.

Currently, SIF is not yet launched or operational.

Equity Mutual Funds: A Reliable Option
Equity mutual funds are proven for long-term goals like education.

They offer inflation-beating growth over a 15-18 year period.

Start investing now to benefit from compounding.

Choose funds with a consistent track record.

Wait and Observe SIF Performance
SIF is a new asset class and lacks a performance track record.

It’s wise to wait for its launch and review its stability.

Assess the fund's returns, risk profile, and management quality.

Investing in an untested asset could increase risks unnecessarily.

Diversify Investments Over Time
Initially, focus on equity mutual funds for growth.

Later, as SIF stabilises and performs well, consider it.

Diversify across asset classes gradually based on market insights.

Final Insights
Begin with equity mutual funds for your child’s education fund.

Monitor SIF's launch and performance over the next few years.

Decide on SIF only after it demonstrates a solid track record.

Keep your investments aligned with your long-term goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

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

Ans: Hello;

Is it possible for you to make a partial withdrawal from GPF?

If yes, then use it to repay the loan and reduce the EMI burden commensurately.

Never do investment with borrowed money, except for home meant for self use.

Worst case sell agricultural land or plot and use the proceeds to reduce outstanding loan and hence EMI outgo.

Best wishes;

Ans: Hello;

Your current monthly income need of 2.4 L will grow up to 12.27 L after 28 years (At your retirement age of 60) considering 6% inflation.

Assuming your expenses at retirement will reduce so you may need 75% of this income to cover your expenses at that time therefore you may need a monthly income of 9.2 L.

To generate this income you may need a corpus of 27 Cr(Min.) at the age 60 that may generate post-tax monthly income of around 9.2 L.

Your investments will grow as follows,

1. PPF: 1.5 L per person per year for 35 years will grow into a corpus of around 4.32 Cr. (6.9% return assumed)

2. LIC: policy maturity proceeds will provide 2 Cr at age 60.

3. NPS: 1 L per person per year may grow into a sum of 2.5 Cr at 60.(8% return considered)

4. MF sip of 10 K may grow into a sum of 2.05 Cr at 60. (10% return considered)

5. FD of 36 L will grow into a sum of 2.1 Cr if held till 60. (6.5% return assumed)

6. Gold in form of bonds if reinvested into gold mutual funds and held till 60 may yield a corpus of around 1.1 Cr. (7% return assumed)

7. Inherited funds if held in FD till the age of 60 may yield a corpus of 9.9 Cr.
(6.5% return considered)

8. EPF is expected to grow into a sum of around 1.8 Cr at the age of 60.(7% return considered)

A summation of investment values at 60 indicates a sum of around 25.77 Cr thereby hinting at a gap of around 1.23 Cr.

You may begin another monthly sip of 7 K now which may grow into a sum of around 1.3 Cr by 60 age.(10% return assumed)

If the mediclaim policy is from employer, do buy a personal health care cover after 50-55 for your family for post retirement needs.

I presume you both have adequate term life insurance cover apart from LIC policy.

The financial goal for your kid's education and family expansion, if any, is not factored here. You may need to plan for it suitably.

Also it appears that your allocation to equity is quite low, may be due to limited risk appetite but you have time on your side and although short to medium term(5-7 yr) equity asset class may be impacted due to volatility but over a long-term(10 yr+) they have demonstrated good inflation adjusted returns so may be you may consider to increase allocation through hybrid funds suiting your risk appetite.

Happy Investing;
X: @mars_invest

Ans: Hello;

If you start a sip of 12 K now, in a flexicap type mutual fund and continue it till you reach 50 years of age, you may accumulate 1 Cr+ corpus, as desired.

You may select any fund from the top quartile in this category.

Ensure sufficient term life cover and adequate healthcare insurance for self and family.

Happy Investing;

Ans: Hello;

If your age is below 60 and you want to exit NPS then you will get only 20% of your corpus while rest 80% you will compulsorily have to buy an annuity.

If your corpus is 2.5 L or less then you can withdraw entire amount lumpsum.

Hope you have completed minimum 5 years of contributing to NPS.

Best wishes;

Ans: Current Financial Snapshot
Annual Income: Rs 80 lakhs
Annual Expenses: Rs 40 lakhs
Capital Available: Rs 4 crores
Age: 48 years
Your income and existing capital provide a strong foundation. With proper planning, you can secure your financial future and achieve your goals.

Key Financial Goals
Retirement Planning: Build a corpus to sustain your post-retirement lifestyle.
Wealth Growth: Invest capital for inflation-beating returns.
Risk Management: Ensure adequate insurance coverage for family security.
Tax Efficiency: Optimise investments to reduce tax liabilities.
Suggested Investment Allocation
1. Emergency Fund
Maintain 6-12 months of expenses (Rs 20-40 lakhs) in liquid funds or a high-interest savings account.
This ensures liquidity for any unforeseen circumstances.
2. Equity Mutual Funds
Allocate 50-60% of your capital (around Rs 2-2.4 crores) to equity mutual funds.
Use diversified funds like large-cap, flexi-cap, and mid-cap funds for growth.
Avoid index funds due to lack of flexibility and active management.
Invest monthly through systematic investment plans (SIPs) for disciplined investing.
3. Debt Investments
Invest 20-25% of your capital (Rs 80 lakhs-1 crore) in debt mutual funds or fixed-income instruments.
Choose funds with low risk to ensure stability and predictable returns.
These funds act as a safety net during market downturns.
4. Children’s Education or Marriage
Allocate funds for long-term goals like education or marriage.
Invest in balanced advantage funds or equity mutual funds for higher returns.
5. Retirement Planning
At 48, focus on building a retirement corpus.
Allocate 20% of your capital (Rs 80 lakhs) to retirement-specific investments.
Use a mix of equity and debt for growth and safety.
Risk Management
Life Insurance
Ensure you have a term insurance cover of at least Rs 2-3 crore.
This protects your family’s financial future in your absence.
Health Insurance
Take a family floater health insurance plan of Rs 25-30 lakh.
Include critical illness coverage to address rising healthcare costs.
Tax Efficiency
Maximise Section 80C benefits by investing in ELSS mutual funds or PPF.
Use NPS for additional tax deductions under Section 80CCD.
Invest in tax-efficient instruments to reduce liabilities.
Regular Monitoring
Review your investments every six months with a Certified Financial Planner.
Rebalance your portfolio to align with market trends and life changes.
Final Insights
You have a strong financial base with high income and significant capital.

With disciplined investing, risk management, and tax efficiency, you can grow your wealth and achieve your goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

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

Ans: Investing Rs. 10,000 monthly in a mid-cap mutual fund is a commendable strategy. It shows your commitment to achieving a robust corpus of Rs. 20 crore in 30 years. However, there are risks and considerations to address.

1. Potential Risks in the Mutual Fund Industry
Market Volatility
Mid-cap funds are more volatile than large-cap funds.

Short-term fluctuations can impact returns during market corrections.

Economic Slowdowns
Economic instability can adversely affect mid-cap stocks.

Such slowdowns could lower the growth trajectory of the fund.

Regulatory Changes
SEBI and government regulations may impact mutual fund operations.

For example, changes in taxation or investment limits can affect returns.

Inflation Risk
Inflation can erode purchasing power and real returns over 30 years.

This risk must be factored into your long-term goal.

2. Risks of Fund House Sustainability
Fund House Stability
A fund house with a poor track record may not survive for 30 years.

Choose an established and reputed fund house with strong governance.

Fund Manager Risk
Performance depends on fund manager decisions.

Manager changes may impact the strategy and consistency of the fund.

Operational Risks
Fund houses may face risks like technology failures or poor compliance.

Verify the operational strength and risk management policies of the fund house.

3. Realistic Return Expectations
Expecting 18-20% annualised returns over 30 years is optimistic.

Historical data shows mid-cap funds average around 12-15% returns.

Relying on higher returns can lead to unrealistic expectations.

4. Diversification for Stability
Do not rely solely on mid-cap funds for your goal.

Diversify with large-cap or flexi-cap funds to reduce volatility.

Balanced funds can provide a mix of growth and stability.

5. Importance of Periodic Review
Monitor your SIP performance regularly, at least once a year.

Assess fund performance against benchmarks and peers.

Make necessary adjustments to align with your goals.

6. Role of Active Fund Management
Actively managed funds can outperform benchmarks during volatile markets.

Fund managers actively track market changes and rebalance portfolios.

This approach offers an edge over passively managed index funds.

7. Tax Implications on Returns
Long-term capital gains (LTCG) above Rs. 1.25 lakh are taxed at 12.5%.

Short-term capital gains (STCG) are taxed at 20%.

Understanding tax implications helps plan withdrawals effectively.

8. 360-Degree Financial Planning
Emergency Fund
Maintain an emergency fund covering 6-12 months of expenses.

This ensures financial stability during unforeseen situations.

Adequate Insurance
Secure yourself with adequate life and health insurance.

Avoid using ULIPs or investment-linked insurance for this purpose.

Retirement Planning
Parallelly invest in retirement-specific instruments for long-term security.

Diversify your portfolio to include stable growth options.

Education and Marriage
Plan separate investments for future education and marriage expenses.

Diversify investments to balance risk across different life goals.

Finally
Mid-cap funds are a promising option for wealth creation, but they come with risks. Diversify, review periodically, and adjust your strategy as needed. Consult a Certified Financial Planner to build a robust, long-term investment plan tailored to your goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

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