Dear Sir , I am 44 years with following investment portfolio I have monthly in hand salary of around 3 lac with monthly SIP of 85k , current corpus is at 82 lacs, mostly in equity mf. I have two flats in ggn with combined valuation of 1.2 Cr ( No loans) yielding me around 30 k rents monthly. I have a fiat where I live in Mumbai , I have taken around 1.16 Cr loan on that , current EMI rs 1.25 lacs. As of Now balance loan tenure is 10.5 years, however I am targeting to pay of this loan by next 7/8 years. Currently my pf balance is around 30 lacs that includes my vpf @ 12% with current monthly contribution of around 60 k ( incl vpf). I have ppf maturing next years with around 30 lac, Additionally wife ppf account with 15 lac will Mature in next 5 years( estimated corpus would be around 25 lacs on maturity). I have corporate nps with currently 15 lac , with current annual contribution of around 2.9 lac equivalent to 14% of my basic salary, Though I have a corporate medical from my company with 15 lac as sum assured for all family members , I have my personal medical insurance as well with 20 lac sum insured in that .I bought a pure term plan 2 years back with 1.5 Cr as sum insured . Our current house hold expenses is around 75-85 k per month which includes grocery, maid, utility charges, child school fee and tuition etc. I have a son in class 9 at present . I am a bit confused on Should I sell of one of flat in ggn ( valued around 65 lac) as I do not expect any major appreciation. If yes what should I do with that fund? Put it in mf or pay my home loan partially. My future goals ( estimated) . Child education 75 lacs in next 4-5 years . Another 50 lac for his marriage in next 12 years . To be able to retire with atleast 10-12 Cr in savings excl property in next 8-10 yes ( 52-55 yrs of age) . What should be way forward and right approach and planning to look for a comfortable retirement at the age of 52-55 years of age. . SJ

Ans: Vishal and Shanti, it's evident you've diligently built a diversified portfolio over the past decade, and you're now looking to fine-tune it to meet your future financial goals. Let's break down your situation and devise a strategic plan to achieve your objectives.

Assessment of Current Portfolio:

You have a robust real estate portfolio comprising five rental properties and a self-occupied residence. However, you also have a significant exposure to the Chinese market through mutual funds. While these investments have performed well historically, it's crucial to acknowledge the higher risk associated with international investments.

Your mutual fund portfolio, particularly the investments in Edelweiss Greater China Fund and Axis China Fund, has seen substantial growth. However, it's important to regularly review your portfolio's performance and adjust your investments as needed to mitigate risks and seize opportunities.

Planning for the Future:

Selling Apartment and Investing in China Fund: Selling one of your properties to invest in a China-focused fund could further diversify your portfolio. However, it's essential to consider the implications of concentrating your investments further in the Chinese market, especially given its volatility and geopolitical risks. Diversification across asset classes and regions is key to managing risk effectively.

Monthly Income and Wealth Creation Goals: Your target of generating a monthly income of 2 lakh rupees, including rental income, is ambitious but achievable with a strategic approach. Considering your current income streams and investments, it's feasible to gradually increase your SIP contributions to meet this target. However, it's essential to assess your risk tolerance and ensure that your investment strategy aligns with your long-term goals.

Investment Strategy: Given your desire to invest globally and your preference for a buy-on-dip strategy, you may consider exploring opportunities in international mutual funds or exchange-traded funds (ETFs) that offer exposure to diverse markets. However, it's crucial to conduct thorough research and consult with a financial advisor to select funds that align with your risk profile and investment objectives.

Recommendations:

Diversification: While international investments can offer growth opportunities, ensure that they complement your existing portfolio rather than increasing concentration risk. Consider diversifying across regions and asset classes to mitigate risk and enhance long-term returns.

Regular Portfolio Review: Continuously monitor the performance of your investments and make adjustments as needed to stay aligned with your financial goals. Regular portfolio reviews with a Certified Financial Planner can help identify opportunities for optimization and risk management.

Risk Management: Given the dynamic nature of financial markets, it's crucial to prioritize risk management and adopt a disciplined approach to investing. Avoid chasing short-term gains and focus on building a resilient portfolio that can withstand market volatility.

In conclusion, while your current portfolio reflects your proactive approach to wealth creation, it's essential to reassess your investment strategy periodically and make informed decisions to achieve your long-term financial objectives. By diversifying your investments, prioritizing risk management, and staying disciplined, you can work towards building a robust financial foundation for your family's future.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

Ans: When there are too many follow-up questions in one go, it becomes difficult to collate and address everything effectively. It’s better to connect directly with a Mutual Fund Distributor + Certified Financial Planner like us for a proper review and action plan.

If you'd like to reach me for a detailed one-on-one consultation, please use the website link in my signature.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

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

Ans: ? Income and Overall Cash Flow

– Your monthly take-home is strong at Rs 2 lakhs post-tax.
– Rental income of Rs 25,000 adds a good passive flow.
– Home loan EMIs can take a significant chunk of your income.
– Two kids' future needs will need careful planning and funding.
– Strong and stable cash flow gives you options to grow wealth smartly.

? Existing Home Loans and Liabilities

– First loan has Rs 15 lakhs outstanding; home is on rent.
– Second loan is quite large with Rs 96 lakhs outstanding.
– Interest outgo will be high on this second home loan.
– Home loan tax benefits are limited beyond a point.
– Loans can create long-term stress if not balanced with returns.
– You must analyse EMI vs benefit carefully for both loans.

? Rental Property Evaluation

– Rental yield is approximately 2% on property value.
– This return is very low when compared with other financial assets.
– Property also comes with tax, maintenance, and tenant risks.
– Liquidity is another concern with physical property assets.
– Rental income is taxable, which further reduces its benefit.

? Foreclosure Decision and Cash Flow Improvement

– Selling the property and using funds to reduce loan is wise.
– Especially foreclosing the second larger loan is smarter.
– Foreclosure helps in improving cash flow instantly.
– You will save a large interest outgo over years.
– Without EMIs, you’ll have higher surplus to invest.
– Emotional attachment to home shouldn’t outweigh financial logic.

– Pay off maximum possible on the 96L loan.
– Partial foreclosure is also a good start if full closure not possible.
– Prioritise freeing up income for kids’ goals and your retirement.

? Emergency Fund Management

– Rs 15 lakhs emergency fund is excellent.
– Keep 6-9 months’ expenses always liquid.
– Remaining can be put in short-term debt mutual funds.
– This can give better returns than savings accounts.

? NPS Investment Strategy

– Monthly Rs 11.5k in Tier 1 is a healthy long-term habit.
– Current corpus of Rs 6 lakhs is on track.
– NPS is tax-efficient and supports retirement planning well.
– Tier 2 corpus of Rs 1 lakh and annual Rs 30-40k addition is fine.
– But NPS Tier 2 is not tax-friendly for withdrawals.
– Better to use this only as satellite allocation.

? Mutual Fund Investment Assessment

– Rs 5,000 monthly in direct mutual funds is positive.
– But direct funds lack professional advisory support.
– Many miss rebalancing, tracking and scheme changes.
– Investing through regular funds with a Certified Financial Planner helps.
– CFP-backed MFDs give disciplined strategy, reviews, and emotional support.
– Their expertise ensures schemes match your risk and goals.
– Paying a small trail fee is worth the long-term benefits.

– Direct funds may work for DIY experts but most investors struggle.
– You can gradually shift existing direct holdings to regular plans.
– This way, your investments will be monitored consistently.

? Insurance Portfolio Review

– Tata AIA ULIP term plan of Rs 1 crore is noted.
– ULIP is not a pure term plan; it’s mix of insurance and investment.
– ULIP charges are higher and returns unpredictable.
– Better to hold a separate term plan and separate investment plans.
– If Tata AIA plan is mainly ULIP, consider surrendering it.
– Redeploy proceeds into diversified mutual funds via regular route.

– Term cover of Rs 1 crore is on lower side for you.
– You can evaluate increasing cover to 15-20 times your annual income.
– Term insurance should only cover income replacement needs.

? LIC Policy Review and Action

– LIC policies usually have low returns around 4-5%.
– These are often endowment or money-back types.
– They are not effective as long-term wealth builders.
– Evaluate surrendering them if minimum term lock is complete.
– Redeploy amount in mutual funds aligned with your goals.
– Only then compounding will work in your favour.

? Kids’ Future and Education Planning

– Daughter’s PPF balance of Rs 14 lakhs is a great start.
– You should continue investing yearly in PPF for her.
– But PPF alone won’t fund higher education fully.
– Add mutual fund SIPs with 10-15 year view for both kids.
– Use equity mutual funds for long-term compounding.
– Ensure these investments are goal-specific and regularly reviewed.

– For the 3-year-old, you have more time to build wealth.
– Start small SIPs and increase every year with income growth.
– This way, you won’t depend on loans later for education.

? Retirement Planning and Your Future Needs

– Retirement is the biggest and longest goal.
– Your NPS is good but should be supplemented.
– Invest more in equity mutual funds for higher post-retirement corpus.
– Use mid-cap and flexi-cap categories to balance risk and reward.
– Review NPS allocation regularly to ensure equity-debt balance is right.

– No pension from LIC or ULIP will be sufficient post-retirement.
– Only a strong mutual fund portfolio can provide income later.
– Maintain discipline and avoid withdrawing unless urgent.

? Real Estate vs Financial Assets Comparison

– Real estate gives poor liquidity and low rental yield.
– Costs like tax, repairs, registration reduce net gains.
– Financial assets are better for goal-based planning.
– They are flexible, transparent, and easier to rebalance.
– Selling one house and shifting to mutual funds is wise.

– You can hold one primary home and focus on financial assets.
– Don't rely on property appreciation for future security.

? Tax Efficiency and Wealth Creation

– Mutual funds offer better tax-adjusted returns than property or ULIPs.
– Equity mutual funds now taxed at 12.5% on gains above Rs 1.25L yearly.
– Short-term gains taxed at 20% if sold within 1 year.
– Debt funds taxed as per income slab both short and long term.
– Tax planning should not drive investment alone.
– Focus on after-tax returns and goal fitment.

– Avoid mixing insurance and investment for tax saving alone.
– Use ELSS for 80C instead of LIC or ULIPs.

? Behavioural Discipline and Tracking

– Most wealth creation is about consistency and review.
– Working with a CFP gives structure and behavioural support.
– Avoid panic during market drops and greed during rallies.
– Track goals, not just returns.
– Make annual reviews a habit.

– Rebalancing is needed as life stages and goals evolve.
– CFP can guide in adjusting allocations with changing priorities.

? Estate and Succession Planning

– As you build wealth, plan nomination and will writing too.
– Use proper documentation for all financial assets.
– Update nominees on insurance, NPS, mutual funds, PPF etc.
– Consider writing a registered Will for smooth transition later.
– Educate spouse about key accounts and policies.

? Final Insights

– Sell the rental home and reduce the larger loan as first step.
– Freeing your cash flow is more powerful than small rental income.
– Shift from direct to regular mutual funds via CFP-led MFDs.
– Review and consider surrendering low-yield LIC and ULIPs.
– Increase SIPs towards kids’ education and your retirement.
– Protect your family with an adequate term plan.
– Build wealth with goal-focused, reviewed, and disciplined investing.
– Work with a CFP to get holistic, unbiased, and structured guidance.
– Always prioritise simplicity, liquidity, and transparency in your finances.
– Let your money give you peace and not stress.

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

Ans: You are already doing very well. At 39, you have a stable career, a good income, disciplined savings, and strong intent to secure your family’s future. Your awareness about risk and long-term vision are impressive. Many people of your age delay this clarity. You already have strong building blocks — a good EPF and NPS contribution, solid liquidity, and high savings ability.

Your questions about buying a house and selling agricultural land are timely. Both require deep thought since they connect with emotions, lifestyle, and financial security. Let us assess your situation step by step.

» Your Present Financial Position

You have Rs 17 lakhs in EPF, Rs 2.1 lakhs in NPS, Rs 15 lakhs in gold, Rs 70 lakhs in liquid funds, and Rs 3 lakhs in ULIP.

You are saving a large part of your salary. EPF and NPS are long-term wealth creators with tax benefits.

You have no home loan liability yet. Rent is only Rs 13,000 per month, which is a small percentage of your income.

You have a young family and a second child on the way, so cash flow flexibility is important.

You are already in a strong and flexible position. Your focus on building Rs 2 crores in the next 7 years and retiring in 10–12 years is clear and realistic — but only if your investments work efficiently.

» Should You Buy a House Now or Continue to Stay on Rent?

Let us look at this carefully from all sides.

Cost of Ownership vs. Cost of Renting
Owning a house sounds emotionally satisfying. But financially, it often locks your liquidity.
A Rs 60-lakh property in Pune will involve stamp duty, registration, and furnishing — adding nearly Rs 8–10 lakhs more. So, your total cost will touch around Rs 70 lakhs.

If you use your liquid funds, you will lose most of your emergency and opportunity corpus. You will then have little flexibility to invest for your Rs 2-crore goal.

Your current rent is only Rs 13,000 per month — less than 0.3% of your income. It is financially very efficient. Rent gives you flexibility, low maintenance responsibility, and liquidity to invest more aggressively.

Return on Investment Perspective
Residential property generally grows at 6–8% annually, sometimes less after factoring maintenance, property tax, and liquidity delay. Mutual funds, on the other hand, have potential to earn 10–12% over long periods when invested properly through a Certified Financial Planner.

If you invest that same Rs 60–70 lakhs in a well-diversified portfolio of equity and debt mutual funds, your compounding benefits will be higher, flexible, and more tax-efficient.

Impact on Your Retirement Goal
You have only 10–12 years before retirement. You cannot afford large idle assets that do not generate cash flow. A self-occupied property does not give income; it only gives emotional comfort. You already have stable rent, so keeping liquidity in investments is better.

Instead of buying a house now, you can rent a better house if needed for family comfort and continue building your corpus faster. Later, near retirement, you can decide to settle in your own house if that aligns emotionally.

Emotional and Family Aspect
Owning a house gives pride, but it should not disturb financial freedom. You already have a growing family. If you buy now, you will reduce liquidity and risk tolerance. That can create pressure in the coming years when children’s education or medical needs rise.

Tax Aspect
You will not get any major tax advantage from buying with full cash, because only a home loan allows interest deduction. Hence, buying without a loan brings no tax benefit and reduces your liquidity sharply.

So, continuing on rent and investing your surplus makes more sense at this stage. The rent is low, and your Rs 70 lakhs can earn and grow.

» Insights on Selling Your Agricultural Land

You mentioned that your agricultural land is around Rs 2 crores and not generating any income. You also cannot cultivate it due to work and absence of family involvement.

This is a very important decision, and we can see it from multiple sides.

Liquidity and Return Factor
Agricultural land gives emotional value, but no income unless you farm or lease it. Holding it also involves maintenance, legal vigilance, and sometimes political or encroachment risks.

If you sell and reinvest systematically, your Rs 2 crores can start generating real returns. Even a moderate 9–10% return annually through diversified mutual funds and other asset classes can give you Rs 18–20 lakhs a year. That’s strong passive income potential.

Holding idle land brings no compounding; investing it properly does.

Capital Gain Implications
When you sell the agricultural land, you may attract capital gains tax depending on how long you’ve held it and whether it qualifies as rural or urban agricultural land. The exact tax treatment depends on local limits, but even after paying tax, you’ll retain a large investable sum.

You can also use part of the proceeds in specified reinvestments or bonds if you wish to defer some tax. A Certified Financial Planner can help plan this legally and efficiently.

Goal Connection
If your goal is to retire comfortably in 10–12 years, the land sale can completely change your financial strength. Reinvesting that Rs 2 crores can help you reach and even exceed your Rs 2-crore corpus target much earlier.

You can then secure your children’s education, medical needs, and early retirement in a stress-free manner.

Emotional Angle
Many people hesitate to sell ancestral or hometown land. But if it is not being used or managed, it becomes a non-performing asset. Selling and reinvesting is a rational, goal-based decision. You are not losing your roots; you are converting them into financial growth for your children’s future.

» What to Do with Your Current Portfolio

You already have EPF, NPS, ULIP, gold, and large liquidity. Let’s refine each:

EPF and NPS
Continue these. They provide stability and tax savings. NPS especially complements your retirement corpus.

Gold Investment
Gold is fine as a safety net, but limit it to about 10% of total wealth. You already have Rs 15 lakhs — that’s enough. Avoid increasing exposure here since gold has long dull phases.

ULIP
ULIPs are not efficient wealth builders. They mix insurance with investment, leading to low transparency and high cost. Since your ULIP is small (Rs 3 lakhs), you can surrender it if lock-in is over and reinvest the proceeds in mutual funds. A Certified Financial Planner can guide you to allocate this properly.

Liquid Funds (Rs 70 lakhs)
This is your strongest asset right now. You can use a systematic transfer plan (STP) to shift this money gradually into well-chosen equity mutual funds over 12–18 months. This reduces market timing risk.

Do not invest directly in mutual funds on your own. Regular plans through a CFP-managed route give better handholding, emotional discipline, and ongoing rebalancing support. Direct plans lack this support and lead to poor long-term investor behaviour.

» Building Your Rs 2-Crore Corpus in 7 Years

Your goal is clear. You can easily invest Rs 1.5 lakhs per month plus part of your liquidity and land proceeds.

Investment Allocation Strategy

Around 70% can go into equity mutual funds for long-term growth.

Around 25% in short- and medium-term debt mutual funds for stability.

Around 5% in liquid or arbitrage funds for emergency needs.

Avoid index funds since they just follow the market without active risk management. Actively managed funds, under a Certified Financial Planner, can navigate market cycles and add alpha returns over time.

Tax Awareness
When you redeem, equity mutual funds have a 12.5% LTCG tax above Rs 1.25 lakh and 20% for short-term. Debt mutual funds are taxed as per your income slab. These rules need careful planning, and your CFP can guide timing and switches efficiently.

» Emergency Fund and Insurance

With a young family, keep around 6–8 months of expenses in liquid form as emergency fund. You already have enough liquidity to maintain this easily.

Also, make sure you have adequate life and health insurance. Pure term life cover (not ULIP or endowment) for about 15–20 times your annual income is ideal. Family floater health insurance must cover both children and spouse adequately.

» Cash Flow Management During Second Child Arrival

When your second child arrives, there will be temporary cash flow pressure. Keep at least Rs 10–15 lakhs aside for 2–3 years as buffer. This ensures your monthly investments continue without stress.

» What to Avoid

Do not rush into real estate as an investment. It ties capital and gives poor liquidity.

Avoid direct stocks or speculative instruments at this stage. Your focus must be stable compounding.

Do not invest in multiple random ULIPs or traditional policies. They dilute returns.

» How a Certified Financial Planner Can Add Value

Your situation needs continuous rebalancing and monitoring. A Certified Financial Planner can help you design and execute a holistic roadmap — from tax planning, child education, retirement, insurance, and cash flow control to legacy planning.

They will guide you with asset allocation discipline, behavioural control, and market strategy. The cost of advice is small compared to the peace and clarity it provides.

» Finally

You are in a strong position, with high income, disciplined savings, and large liquidity. But your next 10 years are crucial.

Continue living on rent and keep liquidity working through mutual fund investments.

Sell your idle agricultural land if you are emotionally comfortable, and reinvest for higher returns.

Channel your Rs 70 lakhs and monthly Rs 1.5 lakhs systematically into a diversified portfolio.

Retain gold and NPS, exit ULIP, and protect your family through insurance and emergency buffer.

This approach will help you achieve your Rs 2-crore target faster, with higher flexibility and peace of mind. You can then enter retirement on your terms — with security, freedom, and dignity.

Best Regards,

K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

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