Hi Sir I am 44 years old, my monthly salary is 2.5 L, CPF contribution of 18k / month. I have a home of 1.35 Cr (loan free), another home of around 20L (loan free). I have started PPF of 1.5 L/ annum for both me and my wife. I opened NPS account last month with plan to invest 20k/ month.I have invested 10L in MF with monthly sip of 1 L. I have invested 3L in stocks ( planning to invest more in future). I have family floater health policy of 30L and Term insurance of 1.5 Cr. My retirement age is 70 years since I am a Medical college Faculty. Please advise me how I plan my retirement so that I can travel abroad least annually and live a comfortable life post retirement. Thanks

Ans: You have built a strong financial foundation with diverse investments and limited liabilities. Let’s create a comprehensive retirement strategy to ensure you can travel abroad annually and enjoy your post-retirement life.

Assessing Your Current Financial Health
Income: Your monthly salary of Rs 2.5 lakh provides ample savings potential.

CPF Contribution: Rs 18,000 per month ensures a steady retirement corpus.

Real Estate Assets: Two fully paid homes provide financial security and potential rental income.

Investments:

Rs 10 lakh in mutual funds and Rs 1 lakh SIPs show commitment to wealth creation.
Rs 3 lakh in stocks and plans for more add growth potential.
NPS at Rs 20,000 per month supplements your retirement plan.
Insurance:

A Rs 30 lakh health policy ensures medical coverage.
A Rs 1.5 crore term plan protects your family.
PPF: Annual Rs 1.5 lakh contributions for you and your wife ensure risk-free returns.

Key Areas to Strengthen
Retirement Corpus Goal: Estimate the total amount required to sustain your desired lifestyle. Include inflation and travel expenses in your calculation.

Investment Diversification: While you have a mix of assets, focus on achieving optimal balance between risk and return.

Contingency Fund: Keep at least 6–12 months of expenses in a liquid fund.

Recommendations for Retirement Planning
Enhance Mutual Fund Investments
Increase your SIP contribution gradually as your income grows.

Focus on actively managed funds to aim for higher returns.

Avoid index funds and direct funds. Regular funds through an MFD with CFP support ensure professional advice and periodic review.

Review your mutual funds annually and replace underperforming ones.

Optimise Stock Investments
Continue adding to your stock portfolio with careful research.

Diversify across industries and avoid speculative trading.

Invest only a small percentage of your total portfolio in stocks to manage risks.

NPS as a Retirement Pillar
Maintain the Rs 20,000 monthly contribution to NPS.

Choose equity-heavy allocation for higher growth as you have a long horizon.

Use NPS Tier-II for additional flexibility if needed for medium-term goals.

PPF for Risk-Free Returns
Continue Rs 1.5 lakh yearly contributions in PPF for you and your wife.

Treat PPF as a low-risk segment of your retirement portfolio.

Consider International Travel Goals
Allocate a separate investment for annual international travel expenses.

Use hybrid funds or balanced advantage funds to build this corpus over time.

Maximise Tax Efficiency
Claim deductions for CPF, PPF, NPS, and health insurance under Sections 80C, 80CCD, and 80D.

Plan withdrawals strategically from mutual funds to optimise capital gains taxes.

Leverage Real Estate
Consider renting out one of your properties to generate additional income.

Avoid further real estate purchases. Focus on financial assets for better returns and liquidity.

Regular Portfolio Review
Review your portfolio every 6–12 months with a Certified Financial Planner.

Align investments with your retirement goals and make adjustments as needed.

Emergency Preparedness
Ensure your emergency fund covers 6–12 months of expenses.

Park this fund in a liquid or ultra-short-term mutual fund for quick access.

Final Insights
You are well-positioned to achieve your retirement goals. With disciplined investing, you can travel abroad annually and enjoy a worry-free post-retirement life.

Strengthen your financial plan by increasing SIPs, diversifying investments, and maintaining a balanced portfolio. A Certified Financial Planner can guide you in optimising your strategy and achieving a financially secure retirement.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

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