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51-Year-Old Looking to Retire With 10 Crores in 9 Years: Can You Help?

Ramalingam

Ramalingam Kalirajan  |6984 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Oct 03, 2024

Ramalingam Kalirajan has over 23 years of experience in mutual funds and financial planning.
He has an MBA in finance from the University of Madras and is a certified financial planner.
He is the director and chief financial planner at Holistic Investment, a Chennai-based firm that offers financial planning and wealth management advice.... more
U Question by U on Oct 01, 2024Hindi
Money

I am 51 yr old , Staying in NCR (Rental); Old Parental House in Lucknow (Vacant, To be sold later, Approx Cost - 60 L); *18.90 L PA salary (In hand), Expenses 10.0L PA (Inclusive of House expenses, Electricity , House rent , Term Insurance Premium, Medical + super Top up Premium, Car Loan for next 32 month etc), 2 Term plan - 1.75 Cr (Cummulative SI) ; Daughter (1 no, 20 yrs) - Higher Education & Marriage, Son (1 No, 13 yrs) - Higher Education & Marriage; New house to purchase (In Lucknow in next 5-6 years after selling the exisitng Parental house , Budget: 75L - 85L);; * Investments : PPF (25th Term Running): 24 L ; Sukhanya (Daughter's) : 4.5L; Shares : 10.0 L. I also earn approx 1-2 Lacs from Interest + Dividends which is again reinvested in SIP. * Monthly investment is 72K in Mutual Fund SIP. SIP in Progress: DSP Elss D/G - 8000/- ; Nippon Mid Cap D/G - 5000/-; Nippon Multi Cap D/G - 8000/-; Parag Flexi Cap D/G - 5000/- ; Quant Elss D/G - 8000/- ; Mirae Elss D/G - 6000/- ; ICICI Pru Val Disc D/G - 7000/-; HDFC Def D/G - 5000/-; HDFC Flexi Cap D/G - 5000/-; HDFC Mfging D/g - 5000/-; HDFC Mid Cap opportunity D/G - 5000/- ; HDFC Top 100 D/G - 5000/- ; * SIP Completed lying dormant (Units available) : Axis Bluechip D/G - 4287 units; Axis Elss D/G - 8049 units; Axis Elss D/IDCW - 4342 units; Sundaram Mid Cap D/G - 1123 units; UTI Nifty 50 index D/G - 3021 units ; ABSL Frontline Equity D/G - 4763 units ; DSP Top 100 D/G - 2203 units ; HDFC Hybrid - 5862 units; HDFC Top 100 D/IDCW - 3640 units ; HSBC ELSS R/IDCW - 1840 units ; HSBC ELSS D/IDCW - 259 units ; ICICI Pru Bluechip D/G - 4267 units ; ICICI Pru Multi Asset D/G - 1775 units ; Mirae Large & Mid Cap D/G - 3395 units ; Mirae ELSS D/IDCW - 8861 units; Nippon Large Cap D/G - 9915 units; Nippn Elss D/IDCW - 12705 units ; Quantum Long Term Equity D/G - 9702 units; I have been Investing from 1998 onwards in SIP ; Till now total invested in SIP : 65L ; Current value is 1.84 Cr). My Wish List : To retire with approx 10CR after 9 years after fulfilling all my obligations; So please Suggest / Guide me , how to move forward with current investments or any restructure is reqd. Thanks in Advance.

Ans: You have built a solid financial foundation over the years. Your investments reflect careful planning and a long-term perspective. With a salary of Rs 18.90 lakhs per annum and expenses of Rs 10 lakhs annually, you have a good balance between income and spending. Your approach to saving and investing is commendable.

Your investments are diversified across various asset classes, including mutual funds, fixed deposits, and shares. This diversification helps reduce risk and enhances the potential for returns. Moreover, your existing investments in PPF and Sukanya Samriddhi Yojana indicate a commitment to secure savings for your children’s future.

Your current monthly SIP of Rs 72,000 in mutual funds is a proactive strategy. You've been investing in various schemes for several years, which has allowed your portfolio to grow substantially. With a total investment of Rs 65 lakhs in SIPs and a current value of Rs 1.84 crores, you’ve demonstrated remarkable discipline.

Evaluating Your Investment Strategy
Your investment strategy is multifaceted, but there are areas that could benefit from evaluation. Let’s break down your investments:

SIP Investments: You are currently investing in several mutual funds across different categories. This diversification is essential to balance risk and return. However, with multiple funds in the same category, there could be an overlap in holdings, leading to dilution of potential returns.

Dormant Units: You have several completed SIPs that are now dormant but hold units in various mutual funds. These funds need careful review to determine whether they are performing adequately. If some funds have not delivered desired returns, it may be time to redeem and reinvest in better-performing options.

Future Financial Goals: You have clear financial goals for your daughter and son regarding their higher education and marriage. Additionally, you plan to purchase a new house in Lucknow. These are significant financial commitments that require careful planning and allocation of resources.

Current Insurance Coverage: You have two term insurance plans with a cumulative sum insured of Rs 1.75 crores. This coverage is essential for your family’s financial security. However, it is crucial to ensure that this coverage is sufficient based on your family's future needs, especially considering your children’s education and marriage.

Optimizing Your Investment Portfolio
To achieve your goal of accumulating Rs 10 crore in the next 9 years, a focused investment approach is necessary. Here are strategies to optimize your portfolio:

Consolidate Your ELSS Funds
You are currently investing in multiple ELSS schemes, which offer tax benefits while providing potential for growth. However, having too many funds can dilute your investment and complicate your financial strategy.

Recommendation: Select one or two high-performing ELSS funds that have consistently demonstrated strong performance. Focus on funds managed by reputable fund houses with a proven track record. This consolidation will help simplify your portfolio and improve overall returns.
Focus on Growth-Oriented Investments
Given your 9-year investment horizon, you have the opportunity to take on more risk for potentially higher returns.

Recommendation: Consider increasing your allocation to growth-oriented mid-cap and small-cap funds. These funds often outperform large-cap funds over the long term. However, they can be volatile, so regular monitoring and rebalancing are essential.
Review Sectoral and Thematic Funds
While sectoral funds can offer high returns, they are also risky and may not provide consistent performance.

Recommendation: Evaluate the performance of your sectoral funds. If any of these funds are underperforming or not aligning with your long-term strategy, consider reducing your exposure. Redirect those investments into diversified large-cap or multi-cap funds. These funds generally offer a more balanced approach and can help reduce overall portfolio risk.
Optimize Dormant Units
Your completed SIPs have left you with units in various funds. While some of these funds may still be performing well, others might not meet your expectations.

Recommendation: Review the performance of your dormant units. If some funds have consistently underperformed, consider redeeming them and reallocating those funds into better-performing options. Ensure you are aware of the tax implications of any redemptions, particularly long-term capital gains tax.
Tax Implications of Mutual Fund Investments
Understanding the tax implications of your investments is critical in optimizing your portfolio.

Equity Mutual Funds: Long-term capital gains (LTCG) exceeding Rs 1.25 lakh are taxed at 12.5%. Short-term capital gains (STCG) are taxed at 20%. When redeeming mutual fund units, consider these tax implications, especially if you're redeeming large amounts.

Debt Mutual Funds: Both LTCG and STCG for debt funds are taxed according to your income tax slab. This means that these funds could increase your tax liability. When managing your portfolio, always factor in these tax implications to make more informed decisions.

Future Financial Goals and Their Impact
Daughter’s Higher Education and Marriage: Since your daughter is now 20, her higher education and marriage are approaching quickly. It's crucial to have a clear plan to fund these significant expenses.

Recommendation: Start earmarking specific funds for her education and marriage. You can consider redeeming some of your ELSS units after the lock-in period to provide funds for these needs. Additionally, you may want to consider a dedicated equity fund that targets these specific goals.

Son’s Higher Education and Marriage: You have a longer time frame for your son’s financial needs. This gives you a more extended period to invest in growth-oriented mutual funds, which can lead to substantial capital accumulation.

Recommendation: Keep investing in high-growth mutual funds for your son’s future needs. By the time he is ready for higher education, your investments should have appreciated significantly.

New House Purchase: Your plan to purchase a new house in Lucknow in the next 5-6 years is an important financial goal.

Recommendation: Start saving for the down payment now by allocating a portion of your current savings into liquid or short-term debt funds. This will ensure you have the necessary funds available when you sell your parental house and need to make the purchase.

Monthly Investment and Saving Strategies
To support your goal of accumulating Rs 10 crore in 9 years, here’s how to maximize your monthly investments:

Increase SIP Contributions: If possible, consider increasing your SIP contributions gradually. Even a modest increase can significantly enhance your investment corpus over time.

Emergency Fund: Maintain an emergency fund to cover at least 6-12 months of your expenses. This fund will ensure you do not need to liquidate investments during market downturns.

Reassess Monthly Expenses: Regularly review your monthly expenses to identify areas where you can cut costs. Any savings can be redirected to your investments.

Utilize Additional Income: The additional income you earn from interest and dividends should also be reinvested. Consider channeling this income into your SIPs or purchasing additional units in mutual funds that align with your long-term goals.

Insurance Coverage Assessment
Your current insurance coverage of Rs 1.75 crores is a good start, but you need to evaluate if it is adequate.

Recommendation: Assess the total future liabilities you would want to cover. This includes your children’s education and marriage expenses and any outstanding loans. If you feel the current coverage is insufficient, consider increasing your term insurance coverage.

Health Insurance: Ensure you have adequate health insurance coverage for you and your family. The medical expenses can be significant, especially in the event of emergencies.

Final Insights
Your disciplined approach to investing has positioned you well for a comfortable retirement. By making a few strategic adjustments, you can optimize your portfolio to achieve your goal of Rs 10 crore in 9 years.

Review Regularly: Conduct regular reviews of your investment portfolio. This will help you stay on track and adjust your strategy as market conditions change.

Stay Informed: Keep yourself informed about market trends and economic changes. Knowledge is a powerful tool in managing your investments effectively.

Seek Professional Guidance: If needed, consult with a Certified Financial Planner for personalized advice. They can provide insights tailored to your unique financial situation and goals.

Your existing investments, combined with a well-structured plan, can help you achieve your retirement goal while fulfilling your family obligations.

Stay committed to your financial plan, and take the necessary steps to ensure your family’s financial future is secure.

Best Regards,
K. Ramalingam, MBA, CFP
Chief Financial Planner
www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment
DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.
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Iam 40yrs old with 1.6lakhs take home with house wife and 3 yr old baby girl. Below is my current financial condition: 1. Taken Home loan for 35 lakhs for apartment worth of 55lakhs in 2022 with emi requirement of 41k for 11yrs (iam paying monthly 45k and one extra 45k emi yearly) 2. Took Gold loan of 11lakhs in 2022(paying from mar2024 onwards monthly 35k) for apartment purpose 3. Holding 2440 sqft land costs 25lakhs in 2021 now it is 35lakhs planned for baby girl marriage 4. 5lakhs emergency fund in FD 5. 6 lakhs FD for SBI life smart wealthbuilder plan purpose for next 6yrly premium payment, 6. Equity 5lakhs invested now mkt value 8lakhs, 7. Mf 8lakhs now 11lakhs (monthly 20k for 10 different funds with 1k stepup yearly) 8. EPF 20lakhs not withdrawn from beginning for retirement plan 9. Ssy 1.2lakhs for baby girl education (monthly 6k) 10. Ppf 50k for baby girl education (monthly 3k) 11. Nps 4.9lakhs now 6lakhs (monthly 12k from company deduction and 50k annually from my side) 12. Holding agriculture land 1acre 7lakhs near hometown purchased in 2018 now it is same price no increase... Holding bcoz I like to have agriculture land... 13. Holding Gold coins 50gms purchasing when there is Amazon offers.. for baby girl ornaments purpose 14. Term insurance 1crore for me and 50lakhs for my wife purchased in 2022 15. Health insurance 20lakhs with premium 60k for 3yrs purchase in 2022... Monthly 1.6lakhs take home spending as below: 1. 45k home loan emi (annually 45k as one extra emi) 2. 30k mf sip ( 3k each for 10 funds - quant infra, quant smallcap, quant elss, 360 one focused, canara robeco smallcap, canara robeco emerging, mirae largecap, pgim flexicap, parag elss, ICICI prudential technology fund) 3. 35k gold loan prepayment 4. 35k home maintenance expenses 5. 10k ssy and ppf 6. 5k apartment maintenance 7. 45k LIc premium annual requirement 8. 40k term loan premium annual requirement taken 1crore for me and 50lakhs for my wife total to 40k premium 9. 30k annually for bike insurance, services and other maintenance 10. 1.3lakhs for baby girl school fees from this year 50% already paid 50% to be paid in oct 2024 11. 60k premium for health insurance once for 3 years purchased in 2022... I have few ask sir: 1. Want to buy 13 to 15Lakhs car.. when to buy with my financial condition and I have no down payment free cash now 2. Should I change my financial saving/investment please suggest as I am not having any free cashflow post the monthly commitment 3. Want to generate 2nd source of income suggest plz which is good to have it 4. Want to become financial freedom by next 10years so what I need to do for it and plan better. 5. Any changes in the current plan suggestion
Ans: It sounds like you're juggling a lot, but you've got a solid foundation laid out. It's admirable how you're balancing your responsibilities towards your family's present needs and future goals. Let's address your concerns and aspirations one by one.

1. Car Purchase Consideration:
You're eyeing a new car, a shiny symbol of comfort and convenience. However, before diving in, let's assess if it aligns with your current financial trajectory:

Timing and Need:
Do you have an immediate need for the car, or is it more of a desire?
Can you postpone the purchase until you've accumulated a down payment or have more breathing room in your budget?
2. Reviewing Savings and Investments:
Your portfolio is diverse, spanning various assets from real estate to mutual funds. Let's evaluate if each piece is still working optimally for you:

Portfolio Alignment:
Are all your investments aligned with your long-term goals and risk tolerance?
Can you streamline or consolidate any holdings to reduce costs or enhance performance?
3. Exploring Additional Income Streams:
You're eager to bolster your financial stability by exploring secondary income sources. Let's brainstorm some viable options:

Leveraging Skills and Passions:
What skills or hobbies do you possess that could be monetized?
Are there freelancing opportunities or consulting gigs in your field of expertise?
4. Planning for Financial Freedom:
Your aspiration to achieve financial independence within a decade is ambitious yet attainable. Let's outline a roadmap to realize this vision:

Defining Financial Freedom:
What does financial freedom mean to you personally?
Is it early retirement, pursuing passion projects, or having more flexibility in your lifestyle?
Strategic Steps:
How can you increase your savings rate to accelerate progress towards your goals?
Are there opportunities to optimize investments or explore alternative income streams?
5. Optimizing Current Financial Plan:
Let's explore potential adjustments to your existing financial strategy to enhance its effectiveness:

Reallocating Resources:
Can you reallocate funds towards higher-performing investments or areas with greater potential?
Are there opportunities to automate savings or investment contributions for greater consistency?
Conclusion:
Your commitment to securing your family's financial future is commendable. By carefully considering each aspect of your financial situation, from major purchases to investment strategies, you're laying a strong foundation for long-term success. Remember, financial planning is a journey, and with patience, diligence, and the guidance of a Certified Financial Planner, you're well-positioned to achieve the freedom and security you desire.

..Read more

Ramalingam

Ramalingam Kalirajan  |6984 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Oct 01, 2024

Asked by Anonymous - Sep 30, 2024Hindi
Money
I am 51 yr old , Staying in NCR (Rental); Old Parental House in Lucknow (Vacant, To be sold later, Approx exptd - 60 L); * 18.90 L PA salary (In hand) ; Expenses 10.0L PA (Inclusive of House expenses, Electricity , House rent , Term Insurance Premium, Medical + super Top up Premium, Car Loan for next 30 month etc), 2 Term plan - 1.75 Cr (Cummulative SI) ; *Future Major Expenses : Daughter (1 no, 20 yrs) - Higher Education & Marriage, Son (1 No, 13 yrs) - Higher Education & Marriage; New house to purchase (In Lucknow in next 5-6 years after selling the exisiting Parental house , Budget: 75L - 85L); Investments : PPF (25th Term Running): 28 L ; Sukhanya (Daughter's ) : 4.0L; Shares : 10.0 L. I also earn approx 1-2 Lacs from Interest + Dividends which is again reinvested in SIP. Monthly investment is 72K in Mutual Fund SIP. SIP in Progress (Mostly its around 45-50 K PM) : DSP Elss D/G - 8000/- ; Nippon Mid Cap D/G - 5000/-; Nippon Multi Cap D/G - 8000/-; Parag Flexi Cap D/G - 5000/- ; Quant Elss D/G - 8000/- ; Mirae Elss D/G - 6000/- ; ICICI Pru Val Disc D/G - 7000/-; HDFC Def D/G - 5000/-; HDFC Flexi Cap D/G - 5000/-; HDFC Mfging D/g - 5000/-; HDFC Mid Cap opportunity D/G - 5000/- ; HDFC Top 100 D/G - 5000/- ; SIP Completed lying dormant (Units available) : Axis Bluechip D/G - 4287 units; Axis ELss D/G - 8049 units; Axis Elss D/IDCW - 4342 units; Sundaram Mid Cap D/G - 1123 units; UTI Nifty 50 index D/G - 3021 units ; ABSL Frontline Equity D/G - 4763 units ; DSP Top 100 D/G - 2203 units ; HDFC Hybrid - 5862 units; HDFC Top 100 D/IDCW - 3640 units ; HSBC ELSS R/IDCW - 1840 units ; HSBC ELSS D/IDCW - 259 units ; ICICI Pru Bluechip D/G - 4267 units ; ICICI Pru Multi Asset D/G - 1775 units ; Mirae Large & Mid Cap D/G - 3395 units ; Mirae ELSS D/IDCW - 8861 units; Nippon Large Cap D/G - 9915 units; Nippn Elss D/IDCW - 12705 units ; Quantum Long Term Equity D/G - 9702 units; I have been Investing from 1998 onwards in SIP ; Till now total invested in SIP : 65L ;; current value is 1.86 Cr). My Wish List : To make approx 10CR after 9 years (Retirement); So please Suggest / Guide me , how to move forward with current investments. Thanks in Advance Life is Crazy
Ans: You are currently 51 years old and have built a solid foundation in your financial portfolio. Your income is Rs 18.9 lakhs annually, with Rs 10 lakhs in expenses. You have well-established investments in mutual funds, PPF, Sukanya Samriddhi Yojana, and shares.

You also have important future financial responsibilities, such as your children’s higher education and marriage, and purchasing a new home in Lucknow. The total value of your mutual fund SIPs stands at Rs 1.86 crores, with a goal of reaching Rs 10 crore over the next nine years when you retire.

Investment in Mutual Funds and Diversification
Your current SIP investments are well diversified, spreading across various market caps such as mid-cap, large-cap, and flexi-cap funds. You have a mix of growth and dividend plans, which provides both long-term wealth accumulation and income.

Your choice of SIPs shows a balanced approach to wealth generation. Mid-cap and flexi-cap funds offer growth potential, while large-cap funds ensure stability.

PPF and Sukanya Samriddhi Yojana provide safe, fixed returns. However, these are low-growth options compared to mutual funds. You should continue to maintain these for safety, but focus more on your mutual fund investments for wealth generation.

Share portfolio worth Rs 10 lakh adds to your overall asset mix. However, stock markets are volatile, and holding a concentrated share portfolio could lead to additional risks.

Future Major Expenses
You have outlined significant future expenses, including higher education and marriage for your daughter and son, as well as purchasing a new house in Lucknow. These expenses will require substantial financial planning, so it is good that you are thinking ahead.

For your daughter’s higher education and marriage, the Sukanya Samriddhi Yojana and part of your mutual fund corpus should be sufficient. You can also plan for an education loan for higher studies to manage cash flow.

Your son’s higher education and marriage will occur a little later, giving you more time to accumulate wealth through SIPs and other investments.

Analyzing Your Current Financial Strategy
Your goal is to achieve Rs 10 crore in nine years. Given that your mutual fund portfolio has grown from Rs 65 lakh to Rs 1.86 crore, it is evident that you are on the right track. However, achieving Rs 10 crore will require consistent and disciplined investing, as well as possible adjustments to your current strategy.

Mutual Fund Allocation and Growth Strategy
SIPs: Continue your SIPs with a systematic increase every year to keep up with inflation and rising living costs. You are currently investing Rs 72,000 per month, which is commendable, but you may need to increase this amount by 10-15% annually to achieve your goal of Rs 10 crore.

Equity Funds: Focus on actively managed equity funds to generate inflation-beating returns. While large-cap funds are safer, mid-cap and flexi-cap funds offer higher growth potential. Given your long-term horizon, you can afford to take moderate risks with mid-cap and flexi-cap funds.

Review Performance: Keep reviewing your SIP performance annually. If any fund underperforms over a long period, consider switching to better-performing funds.

Liquidity and Emergency Funds
Emergency Fund: It is essential to maintain liquidity in case of emergencies. Ensure that you have at least 6-12 months’ worth of living expenses in liquid assets such as a savings account or short-term debt mutual funds.

Parental House Sale: You plan to sell your parental house in Lucknow for around Rs 60 lakh. This will help you fund your new house in Lucknow (estimated at Rs 75-85 lakh). It is wise to sell your parental property closer to when you plan to buy the new house, as holding real estate can tie up liquidity.

Tax Efficiency
With the new capital gains taxation rules, it’s crucial to manage your withdrawals from mutual funds strategically.

Equity Mutual Fund Taxation: Long-term capital gains (LTCG) above Rs 1.25 lakh are taxed at 12.5%. Short-term capital gains are taxed at 20%. Therefore, ensure that you plan any redemptions wisely to minimize tax liability.

Debt Mutual Fund Taxation: Gains from debt funds are taxed as per your income tax slab. Given your salary, you fall into a higher tax bracket, so it’s better to focus more on equity-oriented funds for wealth creation and tax efficiency.

Additional Considerations for Reaching Rs 10 Crore
Increase SIP Investments: You are already investing Rs 72,000 per month. To reach your Rs 10 crore target, consider increasing this by 10-15% annually. This will significantly boost your corpus over the next nine years.

Maintain Asset Allocation: You already have a diverse portfolio. Ensure that you maintain an optimal asset allocation between equity and debt based on your risk profile. As you approach retirement, you can slowly shift a portion of your portfolio to safer debt instruments.

Selling Dormant Units: You have several dormant units in mutual funds that are no longer actively contributing to your portfolio’s growth. Consider consolidating these into your active SIPs for better growth and easier tracking.

Final Insights
You are on a good path toward achieving your Rs 10 crore goal. Your current portfolio is diversified and growth-focused, which is essential for long-term wealth creation. However, there are a few key points to focus on:

Increase your SIP contributions annually to maximize compounding benefits.

Monitor your portfolio’s performance regularly to ensure you are on track.

Maintain liquidity for emergencies and future needs like your children’s education and house purchase.

Plan your tax liabilities while redeeming funds to ensure that you retain most of your gains.

By following this disciplined approach, you should be able to achieve your retirement goal comfortably.

Best Regards,

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

..Read more

Milind

Milind Vadjikar  |590 Answers  |Ask -

Insurance, Stocks, MF, PF Expert - Answered on Oct 24, 2024

Asked by Anonymous - Oct 23, 2024Hindi
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Dear Arora Sir, I am 51 yr old , Staying in NCR (Rental); Old Parental House in Lucknow (Vacant, To be sold later, Approx Cost - 60 L); *18.90 L PA salary (In hand), Expenses 10.0L PA (Inclusive of House expenses, Electricity , House rent , Term Insurance Premium, Medical + super Top up Premium, Car Loan for next 32 month etc), 2 Term plan - 1.75 Cr (Cummulative SI) ; Daughter (1 no, 20 yrs) - Higher Education & Marriage, Son (1 No, 13 yrs) - Higher Education & Marriage; New house to purchase (In Lucknow in next 5-6 years after selling the existing Parental house , Budget: 75L - 85L);; * Investments : PPF (25th Term Running): 24 L ; Sukhanya (Daughter's ) : 4.0L; Shares : 10.0 L. I also earn approx 1.0 Lacs / yr from Interest + Dividends which is again reinvested in SIP. * Monthly investment is 72K in Mutual Fund SIP. SIP in Progress: DSP Elss D/G - 8000/- ; Nippon Mid Cap D/G - 5000/-; Nippon Multi Cap D/G - 8000/-; Parag Flexi Cap D/G - 5000/- ; Quant Elss D/G - 8000/- ; Mirae Elss D/G - 6000/- ; ICICI Pru Val Disc D/G - 7000/-; HDFC Def D/G - 5000/-; HDFC Flexi Cap D/G - 5000/-; HDFC Mfging D/g - 5000/-; HDFC Mid Cap opportunity D/G - 5000/- ; HDFC Top 100 D/G - 5000/- ; My choice of selecting MF House & Scheme is mainly word of mouth / Google etc.. not much of research !! * SIP Completed lying dormant (Units available) : Axis Bluechip D/G - 4287 units; Axis Elss D/G - 8049 units; Axis Elss D/IDCW - 4342 units; Sundaram Mid Cap D/G - 1123 units; UTI Nifty 50 index D/G - 3021 units ; ABSL Frontline Equity D/G - 4763 units ; DSP Top 100 D/G - 2203 units ; HDFC Hybrid - 5862 units; HDFC Top 100 D/IDCW - 3640 units ; HSBC ELSS R/IDCW - 1840 units ; HSBC ELSS D/IDCW - 259 units ; ICICI Pru Bluechip D/G - 4267 units ; ICICI Pru Multi Asset D/G - 1775 units ; Mirae Large & Mid Cap D/G - 3395 units ; Mirae ELSS D/IDCW - 8861 units; Nippon Large Cap D/G - 9915 units; Nippn Elss D/IDCW - 12705 units ; Quantum Long Term Equity D/G - 9702 units; I have been Investing from 1998 onwards in SIP ; Till now total invested in SIP : 66L ;; current value is 1.74 Cr). My Wish List : To make approx 10CR after 9 years (Retirement); So please Suggest / Guide me , how to move forward with current investments or any restructure is reqd. Thanks in Advance.
Ans: Hello;

Your corpus value 9 years hence will be 7.80 Cr.

This working includes sip corpus, ppf, ssy, stock holding, dividend/interest reinvestment in SIPs, dormant sips future value after 9 years and parental house current value.

You may redeem the IDCW scheme dormant SIPs and reinvest the proceeds in current sip funds equally as lumpsum.

Regarding existing SIP funds, I suggest you to remove thematic funds like HDFC defence and HDFC manufacturing funds and redirect those SIPs into PPFAS flexicap fund and HDFC Top 100 fund.

Please confirm the EPF and NPS, if any, corpus available to you which can supplement the corpus gap of 2.2 Cr.

The prospect of sip enhancement or top-up to meet target shortfall is prohibitively high hence unfeasible.

Please feel free to revert.

Happy Investing;

..Read more

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Kanchan

Kanchan Rai  |392 Answers  |Ask -

Relationships Expert, Mind Coach - Answered on Nov 07, 2024

Asked by Anonymous - Nov 06, 2024Hindi
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Relationship
Hello Maam/Sir, A married guy is constantly giving me much attention. Im.tried to ignore him but he is constantly making appearance from different places. I dont what his real intentions are but because of his constant staring and public apearances. I feel difficult to overlook his behaviour. He is currently gone to his hometowm. So, there is lots of peace. Im not sure why is he trying to get a glimpse of me as he is already happily married n have a son. I need advice to ignore him so that I focus on my husband only.
Ans: The key to redirecting your focus lies in setting boundaries—both mentally and behaviorally. Often, people respond to subtle cues, so maintaining a neutral and reserved demeanor can help communicate disinterest. If he attempts to engage directly, keeping interactions brief and polite without encouraging deeper conversation will likely make your boundaries clear without causing conflict. When he’s present, avoid returning his gaze; this can subtly communicate that you’re not reciprocating his interest.

If this continues, grounding yourself in thoughts about your husband and what you value in your relationship can help you mentally reinforce where your focus truly lies. Remind yourself that someone else’s behavior is not your responsibility and that your own actions, comfort, and peace are within your control. By reinforcing your own values and commitments, you’ll feel more empowered to maintain your focus where you want it—on your husband and your well-being.

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Nitin

Nitin Narkhede  |36 Answers  |Ask -

MF, PF Expert - Answered on Nov 07, 2024

Asked by Anonymous - Nov 04, 2024Hindi
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Money
I am a 45 year old IT professional with following saving/investment as of now: 30 lacs: EPF 30 lacs: PPF 30 lacs: FD 10 lacs: NPS NOTE: 1. I have monthly expenditure of 50k 2. Additionally, NPS requires 12k monthly investment 3. No liabilities and no loan 4. Staying in own house. Queries: 1. I am planning to retire in next 1-2 years. Pls suggest best way to invest above money. 2. Also, I have gold of worth 25 lacs, so should I keep that with me or instead sell it now and invest money elsewhere?
Ans: Dear Friend,
At 45, retiring at 2 years is 47, with an expense of 50K per month plus 12K per month NPS needs 62K per month. Considering a life expectancy of 77, you need funds for the next 30 years. Not considering medical or any other emergency expenses, you also need 2.25 cr in expenses in the next 30 years. Hence, you can consider rearranging the finances as below.
PPF (?30 Lakhs Total): Continue these as they offer tax-free, secure returns. During retirement, you can withdraw in tranches to maintain liquidity. Keep it as you find financial security; do not touch it, and let it grow.
As you declare retirement at 47, you have EPF (?30 Lakhs Total) and Fixed Deposit (?30 Lakhs). You can withdraw this amount and invest it in Balanced or index MF funds, which offer yearly 12% to 14% average returns. You can also start SWP from this.
NPS is a good retirement investment, but there are many restrictions on premature withdrawals. If you retire at 47, you will not get a withdrawal until age 60 for 60% of the amount, and the balance 40% will be converted to pension after age 60. You can withdraw 60% of the amount from the balance 6 years older for premature withdrawal. If your finances permit, continue investing after retirement.
Gold can be a good hedge against inflation. Gold returns an average of 8 to 10% return on an average. However, if you don't have an emotional attachment or strategic reason to hold it, consider selling and reinvesting in diversified assets like balanced mutual funds or a senior citizen savings scheme for higher returns.
Overall, at 47, you need about 1 cr in your MF for expenses after retirement with 50K PM.
With the amount you have mentioned, you can live a decent life without any frills. My suggestion is that you increase your corpus to fulfill all your life's needs other than your monthly expenses.
Regards,
Nitin Narkhede
Founder & MD, Prosperity Lifestyle Hub https://Nitinnarkhede.com
Free Webinar https://bit.ly/PLH-Webinar

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Nitin

Nitin Narkhede  |36 Answers  |Ask -

MF, PF Expert - Answered on Nov 07, 2024

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Sir i am chitra, i have 30lk credit dueto my family circumstances. All jewell loans, i want close, i have a capability to repay upto 20000/- per month. My salary 25000/- lecturer, i earn extra income 10000/- my sister ask me to help to repay loan. But since i am a guest faculty 15 in college, i have no option to give my salary slip. How camn i get 30lk loan. Any help.
Ans: Here are a few approaches to consider for managing and potentially restructuring your loan obligations: You can Explore Gold Loan Refinance, If your existing ?30 lakh debt is mostly gold loans, you may consider refinancing the loan through a different lender, like a bank or NBFC, which could offer a better interest rate or longer repayment term. For refinancing options, it’s worth checking lenders like SBI, HDFC, or even gold loan providers like Muthoot or Manappuram, as they might not require strict documentation. You can also try to Negotiate with the Lender for Extended Tenure**: If possible, talk to your lender about extending the tenure of your existing gold loan. This would reduce the monthly EMI and allow you to use the freed-up amount to pay off the debt gradually without taking on more loans. Another approach can be to Consolidate Loans with a Gold Loan Top-Up, Since your assets are in gold, a top-up loan on your gold may be easier than getting a new personal loan.
Given that your income and commitment to paying off your debts, a combination of gold loan refinance, top-up, or consolidation might provide a practical path forward. Ensure you review interest rates carefully to avoid additional financial strain
Regards,
Nitin Narkhede
Founder & MD, Prosperity Lifestyle Hub https://Nitinnarkhede.com
Free Webinar https://bit.ly/PLH-Webinar

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Ramalingam

Ramalingam Kalirajan  |6984 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Nov 07, 2024

Asked by Anonymous - Nov 07, 2024Hindi
Money
I’m Rajiv from Udaipur. I’m 38 with one son, aged 5. We’re planning to save for our child’s education and our own retirement. Should we invest more in equity mutual funds, or should I look into fixed-income options to balance the risks?
Ans: You’re already thinking wisely about your child’s education and your retirement. This focus sets a solid foundation for financial security. Saving for both these goals needs a careful balance of growth and safety. Let’s examine where equity mutual funds and fixed-income options fit within these plans.

Importance of Equity Mutual Funds for Long-Term Growth
Equity mutual funds are essential for long-term financial goals, especially given inflation's impact on education costs and retirement. Here’s why:

Growth Potential: Equity funds have historically delivered strong returns over time, which can help you build a substantial corpus. This is especially useful for goals with a longer horizon, like your child’s higher education and your retirement.

Power of Compounding: As you continue investing regularly, the compounding effect amplifies returns, giving your investments a significant boost. This can be critical when saving for expenses expected to rise, such as education costs.

Tax Benefits: Equity mutual funds offer tax benefits. For long-term capital gains (LTCG), the first Rs 1.25 lakh is tax-free, and the rest is taxed at 12.5%. Short-term capital gains (STCG) are taxed at 20%. These benefits can contribute positively to your overall returns, especially in the long run.

Why Avoid Index Funds in This Strategy?
Though index funds are popular, actively managed funds may be better in your case for specific reasons:

Active Management Advantage: Actively managed equity mutual funds involve professional fund managers making strategic decisions, which can outperform the broader market index during volatility.

Flexibility in Market Conditions: In fluctuating markets, fund managers can adjust portfolios. This dynamic approach can help you manage risks and achieve better results, especially for long-term goals like education and retirement.

So, while index funds may seem appealing, actively managed funds provide professional guidance and potential for higher returns over time.

Benefits of Fixed-Income Options for Stability
Fixed-income investments serve as a safety cushion in any financial portfolio. They can add stability to your investment mix and provide regular income, which might be especially useful as you approach retirement.

Low-Risk Returns: Fixed-income options generally offer lower but safer returns compared to equities. This can protect part of your corpus against market volatility, reducing risk for essential goals.

Capital Preservation: Fixed-income investments are excellent for capital preservation. As you near retirement, they can provide steady returns while preserving your initial investment.

Liquidity Needs: Some fixed-income options offer liquidity, which could be helpful for short-term financial needs without disturbing your core investments in equity funds.

While fixed-income investments don’t match equity funds’ growth potential, they serve a key role in risk reduction.

Regular vs. Direct Funds: Why Go with Regular Funds Through a CFP?
Some investors consider direct funds for potentially lower fees, but regular funds through a certified financial planner (CFP) offer distinct benefits:

Professional Guidance: Regular funds allow you to work with a CFP. They bring years of expertise to help you manage funds effectively, especially in a fluctuating market.

Simplified Process: Investing through a CFP can be simpler, especially if you’re not deeply familiar with the investment landscape. This guidance can be critical for meeting specific goals, like saving for your child’s education.

Holistic Planning: Working with a CFP offers a more comprehensive approach, with advice that adapts to changing market conditions and your unique goals.

Direct funds can seem attractive for cost savings, but regular funds provide a professionally managed route, which can be beneficial for your long-term goals.

Evaluating Equity and Fixed-Income Allocation
Balancing equity and fixed-income investments can help you achieve your goals while managing risk.

For Education: Consider allocating more toward equity funds since you have a medium-to-long-term horizon. This can help grow your corpus to meet the rising costs of education.

For Retirement: Start with a higher equity allocation in the initial years to maximise growth. Gradually increase your allocation to fixed-income investments as you near retirement, creating a steady income stream.

This diversified approach combines growth potential with the stability needed to safeguard your retirement savings.

Making the Most of SIPs (Systematic Investment Plans)
Systematic Investment Plans (SIPs) are powerful for building wealth gradually, especially in equity mutual funds. They’re ideal for disciplined savings and work well for long-term goals.

Market Volatility Benefit: SIPs help you avoid timing the market. By investing at regular intervals, you buy more units during market dips, potentially increasing returns over time.

Easy to Budget: SIPs allow for regular, budget-friendly investments. This approach is manageable while supporting consistent savings for your child’s education and retirement.

SIPs are particularly beneficial when paired with equity mutual funds for long-term goals.

Taxation Insights
Understanding the tax implications of your investments is essential, as it affects net returns.

Equity Funds: For equity mutual funds, LTCG exceeding Rs 1.25 lakh is taxed at 12.5%, while STCG is taxed at 20%. Tax-efficiency is one of the reasons to include equity funds in your portfolio.

Fixed-Income Investments: Gains on debt mutual funds are taxed as per your income tax slab, both for short and long-term gains. Fixed-income options offer stability but come with different tax rules, so they should be balanced within your portfolio.

Balancing equity and fixed-income investments with awareness of tax implications helps you maximise your overall returns while keeping tax liabilities under control.

Flexibility in Financial Planning
Life goals and circumstances evolve. Flexibility is key in adapting your financial plan over time.

Review Regularly: Re-evaluate your investment strategy at least annually to check if it aligns with your goals. This ensures your portfolio stays on track for both education and retirement needs.

Adapt Allocation: Gradually shift to safer investments as you near retirement. This shift reduces exposure to volatility and protects your accumulated wealth.

Adapting your plan keeps it relevant and aligned with your changing life needs.

Final Insights
Balancing equity and fixed-income investments allows you to achieve growth and stability for your financial goals. Equity mutual funds support long-term growth, ideal for education and retirement. Fixed-income options add stability, reducing risk as you move closer to retirement.

By using SIPs and working with a CFP through regular funds, you gain access to professional management. This approach simplifies the investment journey and ensures your portfolio stays aligned with your goals and market conditions.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

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

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Milind

Milind Vadjikar  |590 Answers  |Ask -

Insurance, Stocks, MF, PF Expert - Answered on Nov 07, 2024

Asked by Anonymous - Nov 06, 2024Hindi
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Hi I am 50 yrs old and now I am jobless. Searching for new job. I have @ 28 lacs in FD 30 lacs in Security, have invested of @ 50 lacs in Mutual funds, 20 lacs in ppf. My monthly expenses are 1.5 lacs. Wife is home maker and have parents who are living with me. Also son is outside India and is yet to get a job. So pl suggest how can I meet monthly expenses still i get a new job @ 6 months down the line
Ans: Hello;

Your current corpus of 1.28 Cr will not be sufficient to cover 50% of your monthly expenses.

Do you have any EPF/NPS corpus available?

Please confirm so that based on that input we could offer you some solution.

Best wishes;

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DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Investment in securities market are subject to market risks. Read all the related document carefully before investing. The securities quoted are for illustration only and are not recommendatory. Users are advised to pursue the information provided by the rediffGURU only as a source of information and as a point of reference and to rely on their own judgement when making a decision. RediffGURUS is an intermediary as per India's Information Technology Act.

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