How can a 36-year-old PSB employee with limited savings achieve a monthly income of Rs. 1 lakh after 10 years?

Hi! I am a 36 year old PSB employee, have a salary of around 80k post tax, deduction towards NPS, Loans etc. I barely have a corpus to rely on and the fixed assset is in my parents' name. How much should I save that I have around 1 lakh rupees monthly income after say 10 years and where should I invest and how much?

Ans: Hello;

The investible amount required to build a corpus in 10 years capable of yielding 1 L monthly income is too high(1.3 L monthly sip).

60 K monthly sip required for 15 years.

30 K monthly sip required for 20 years to generate a corpus of around 3 Cr, which if annuitized shall yield you a monthly income of 1 L(post-tax).

12% returns assumed from pure equity mutual funds and 6% annuity rate considered.

This is without considering any EPF/NPS balance.

Happy Investing;

Ans: Your Income and Expense Balance

You earn Rs.1.5 lakhs per month. That is a strong start at your age.

You spend only Rs.30,000 per month. That shows good control.

You save Rs.1.2 lakhs per month. This is truly impressive.

Most people at 23 cannot do this. Appreciate your financial discipline.

You now need a proper system to use this surplus well.

This will help build long-term wealth, peace, and security.

Build a Strong Emergency Fund First

Keep 6 months of expenses as emergency money.

Your monthly expense is Rs.30,000. So keep Rs.1.8 lakhs aside.

Don’t keep this in savings account.

Use liquid mutual funds or sweep-in FD for safety.

This is not an investment. This is protection.

Use it only for job loss or health need.

Once you build this, never touch it casually.

Take the Right Health Insurance Policy

One hospital visit can damage your savings.

Buy a good health insurance plan for self.

Prefer a base policy with Rs.5 to Rs.10 lakhs cover.

Later add top-up if needed.

Even if your company gives cover, buy one personally.

This protects you if you change jobs.

Premium is low at 23. Benefit is high.

Pay this from your monthly savings.

It’s a smart protection step, not waste.

Start SIPs in Actively Managed Mutual Funds

You are young. You can take more equity exposure.

Start SIPs in actively managed mutual funds only.

Avoid index funds. They give average returns only.

Index funds follow the market blindly. No expert guidance.

You need better growth than average.

Actively managed funds have skilled fund managers.

They pick better stocks based on research.

They adjust portfolio based on market cycles.

This improves your long-term returns.

Also gives more peace during market fall.

This is why we suggest active funds only.

Invest Through a Certified Financial Planner in Regular Plan

Don’t use direct mutual funds on your own.

Direct funds may save small commission.

But they give no guidance or support.

You may choose wrong fund by mistake.

You miss review, rebalancing and personalised advice.

Regular plan through Certified Financial Planner is safer.

You get proper risk profiling and goal-based plan.

They help you invest with discipline for the long term.

You don’t need to track markets every day.

Your focus can remain on your career.

Create Clear Short-Term, Mid-Term and Long-Term Goals

You must divide your goals into three buckets.

Short-term goals: in 1-2 years like travel or laptop.

Mid-term goals: 3-5 years like car or marriage.

Long-term goals: 7+ years like house or retirement.

Use different funds for each bucket.

Short-term money should be safe and low-risk.

Mid-term can have balanced risk.

Long-term can have higher equity exposure.

This will give balance and peace of mind.

Track All Investments Regularly

Start a simple spreadsheet or use an app.

Record each SIP and investment.

Update values once in a while.

Track how much goes into each goal.

Don’t invest blindly without checking progress.

Also avoid switching too often. Stay long term.

Patience gives better results in mutual funds.

Don’t Keep Too Much in Bank Account

If you keep too much idle in bank, you lose value.

Inflation eats into bank interest returns.

FD interest is taxable as per your slab.

So, after keeping emergency fund, invest surplus wisely.

Keep only 1 month expense in savings account.

Rest should be earning better returns for future goals.

Avoid Fancy Investments or Hype Products

People may suggest crypto or quick money ideas.

These are risky and volatile.

You are young, but don’t gamble with money.

Stick to tested products with long-term proof.

You don’t need thrills. You need peace and wealth.

Always trust expert guidance, not WhatsApp tips.

Avoid Real Estate as Investment at This Age

Don’t buy property as investment now.

It blocks too much money at early age.

Loan EMI can reduce savings drastically.

Also gives less liquidity and high maintenance cost.

You are better off with flexible and growth-oriented mutual funds.

Start small and scale up slowly. No pressure needed.

Stay Disciplined with Lifestyle Spending

Your expenses are under control now. Keep it like that.

As your income grows, lifestyle can grow too.

This is called lifestyle inflation. It eats savings fast.

Don’t increase expenses just because salary increased.

Use income growth to increase SIP amount instead.

Buy needs, not show-off items.

Save before you spend, not the reverse.

This habit builds strong financial base for future.

Use Annual Bonus or Hike Wisely

When you get bonus, don’t use it fully for shopping.

Use part of it to invest more in SIPs.

You can also top-up existing funds.

Use bonus to prepay loans if you ever have one.

Or use it to grow your emergency fund.

These steps give long-term strength and control.

Understand Taxation on Mutual Funds

Long-term capital gains (LTCG) on equity mutual funds is taxed.

Above Rs.1.25 lakh gain, tax is 12.5%.

Short-term capital gains are taxed at 20%.

So stay invested for long term. Don’t redeem often.

Debt mutual funds are taxed as per your slab.

Choose funds carefully based on duration and goals.

A Certified Financial Planner can guide you better here.

Review Insurance If You Buy Any Policy

If someone sold you an insurance-cum-investment plan, check details.

ULIPs and endowment plans give low return and lock money.

If you already hold, consider surrender if no heavy penalty.

Take term insurance separately later when you have dependents.

For now, focus only on health insurance.

Don’t Buy ULIPs or Traditional Plans Now

These policies look safe but give poor growth.

They lock your money for many years.

Returns may not beat inflation even.

Also have high charges and no flexibility.

Better to invest in mutual funds for growth.

Buy term insurance separately later if needed.

Add SIP Step-Up Every Year

Increase your SIP every year with income growth.

Start with Rs.30,000 per month. Next year make it Rs.36,000.

This helps build wealth faster without effort.

Your savings ratio improves without any pain.

It’s called SIP step-up or top-up SIP.

This is a simple but powerful strategy.

Think Long-Term Always

You are just 23 now.

You have 35+ years of earning life.

This is a big advantage.

If you invest Rs.30,000 monthly for 30 years, it becomes huge.

That’s the power of compounding.

But only if you stay patient and consistent.

Don’t chase short-term returns. Think 10, 20, 30 years ahead.

Build a Retirement Corpus from Now

Most people start retirement planning very late.

You start now, you win big.

Even small monthly SIP grows huge by age 60.

Start one mutual fund just for retirement goal.

Let it run quietly without disturbance.

This will become your biggest strength later.

You’ll never depend on others for retirement.

Consult a Certified Financial Planner for 360-Degree Plan

You have good income and low expenses. That’s rare at 23.

But now you need a 360-degree financial plan.

Certified Financial Planner will help with goal planning, SIP setup, review, tax help.

They can guide you better than friends or online tips.

They bring experience, structure, and peace.

You don’t need to manage everything alone.

Get guidance and grow smartly.

Finally

You have a golden opportunity at this young age.

Your savings potential is amazing. Use it wisely.

Start small, stay regular, and think long term.

Don’t rush. Don’t copy others. Make your own plan.

Use SIPs in actively managed funds through Certified Financial Planner.

Keep insurance and emergency fund ready.

Control expenses. Increase SIPs yearly.

Track goals and stay disciplined.

You will achieve big things by age 40.

Your financial freedom journey begins today.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

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