Sir I am 44 years and I am working in IT related company with approx Rs 1.3L monthly take home. I have a taken a home loan of 1.15 Cr for 16 years. The monthly EMI is comes to 1.10L. The flat cost above 1.5 Cr for which I have put my savings for the rest of the amount. I am concerned off late on closing the loan in a timely manner. With my expenses for kids education ( they are in school now) How can I plan it better. My wife is also working currently with approx 80k monthly salary.
Ans: Considering your current family income, your debt-to-income ratio is approx 53%, which is very high and may affect your lifestyle as also your future goals. You should consider the following-
Home Loan Repayment: Consider allocating any annual bonuses, tax refunds, or windfalls towards your home loan to make lump-sum payments and reduce the principal amount. If you receive salary hikes, consider using a portion of the increase towards your EMI payments, which will accelerate loan repayment.
Children's Education Fund: Open a separate investment account for each child's education. Invest in diversified mutual funds or fixed deposits and other assets which offer a balance between risk and returns, saving on tax perspective as well.
Emergency Fund and Insurance: Keep your emergency fund in a liquid and accessible account, like a savings account or a short-term fixed deposit, for immediate use.
Future Financial Goals: Outline your long-term financial objectives, such as retirement, and start investing towards these goals. Consider options like Employee Provident Fund (EPF), Public Provident Fund (PPF), or National Pension Scheme (NPS).