36 Year Old With Savings of Rs.1.95 Cr Seeks Retirement Advice

Ans: At 36, you’re in a strong financial position, working in a private company in Mumbai. Your monthly expenses are Rs 65,000, excluding rent, and you manage to save Rs 6 lakhs per annum. Your savings and investments include Rs 1.6 crore in direct equity, Rs 10 lakhs in mutual funds, and Rs 25 lakhs in fixed deposits. Additionally, you own a 3 BHK flat that generates Rs 25,000 per month in rental income.

Assessing Your Retirement Needs
To determine how long you need to work before retiring, it’s essential to understand your retirement needs. Maintaining your current lifestyle post-retirement will require careful planning to ensure that your expenses are covered without compromising your standard of living. Here are some key factors to consider:

Monthly Expenses and Lifestyle
Your current monthly expenses are Rs 65,000. Post-retirement, you might need to adjust for inflation, healthcare costs, travel, and leisure activities. Planning for these expenses is crucial to avoid financial shortfalls.

Inflation Impact
Inflation erodes purchasing power over time. Assuming an average inflation rate of 6-7%, your expenses will double approximately every 10-12 years. This means your current expenses of Rs 65,000 might be around Rs 1.3 lakhs per month in 12 years. It’s vital to factor in inflation to ensure your retirement corpus can sustain your lifestyle.

Current Savings and Investments
Your diverse investment portfolio is impressive. Here’s a breakdown of your current savings and investments:

Rs 1.6 crore in direct equity
Rs 10 lakhs in mutual funds
Rs 25 lakhs in fixed deposits
Rs 25,000 monthly rental income from your 3 BHK flat
Direct Equity Investments
Your significant investment in direct equity suggests a strong appetite for risk and potential high returns. While direct equity can yield substantial growth, it also comes with market volatility. As you approach retirement, gradually shifting a portion of these funds to safer investments will help protect your capital.

Mutual Funds
With Rs 10 lakhs in mutual funds, you have diversified your investments to reduce risk. Actively managed mutual funds, in particular, offer professional management and the potential for higher returns. Avoiding index funds is wise, as they may underperform in volatile markets. Regular funds, managed by professionals, can provide better returns and flexibility.

Fixed Deposits
Your Rs 25 lakhs in fixed deposits offer stability and assured returns. Though FD rates may not always outpace inflation, they provide a reliable income stream. As retirement approaches, increasing your allocation to fixed deposits or other safe instruments can secure your financial future.

Rental Income
Your 3 BHK flat generating Rs 25,000 per month in rental income adds to your financial stability. However, consider potential fluctuations in rental demand and property maintenance costs. Diversifying your income streams can reduce dependency on any single source and provide financial resilience.

Healthcare and Insurance
Healthcare costs can significantly impact your retirement corpus. Ensuring you have adequate health insurance coverage is essential. Review your current policies and consider enhancing your coverage if necessary. Life insurance policies should also be evaluated to align with your financial goals. Surrendering investment-cum-insurance policies like ULIPs or LIC plans and reinvesting in mutual funds can yield better returns and flexibility.

Estimating Your Retirement Corpus
To estimate your required retirement corpus, consider the following:

Your annual expenses adjusted for inflation
Expected lifespan (planning till age 85-90 is prudent)
Expected returns on your investments
Without specific calculations, a diversified portfolio that includes equity, debt, and other instruments is essential. A Certified Financial Planner can help design a portfolio balancing growth and safety, ensuring your corpus lasts throughout your retirement.

Transitioning to a Safer Portfolio
As you approach retirement, transitioning to a safer investment portfolio is crucial. This involves gradually reducing exposure to high-risk investments like direct equity and increasing allocations to safer options like fixed deposits, debt mutual funds, and government schemes. This shift helps protect your corpus from market volatility and provides a stable income stream.

Generating Post-Retirement Income
After retiring, generating a stable post-retirement income is essential. Your rental income, coupled with returns from a well-diversified investment portfolio, can provide the necessary funds. Consider systematic withdrawal plans (SWPs) from mutual funds, and other instruments that offer regular income. Balancing your withdrawals to ensure your corpus lasts is key to a comfortable retirement.

Working with a Certified Financial Planner
Engaging a Certified Financial Planner can provide personalized guidance tailored to your unique financial situation. A CFP can help assess your current financial health, project future needs, and design a strategy to achieve your retirement goals. Regular reviews with your CFP ensure your plan adapts to any changes in your financial circumstances or goals.


You’ve done an excellent job of saving and investing. Your disciplined approach and diverse portfolio demonstrate a strong commitment to your financial future. It’s evident you’ve put significant thought into your retirement planning. With a few strategic adjustments and continued focus, you’re well on your way to a secure and comfortable retirement.

Final Insights
To summarize, you’re on a solid financial footing. Continue saving diligently and consider gradually shifting your portfolio towards safer investments as you near retirement. Engage with a Certified Financial Planner to refine your strategy and ensure you’re on track to meet your retirement goals. With careful planning and disciplined execution, you can achieve a comfortable and financially secure retirement.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in