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As a 52-year-old with an 8-year job gap, can I utilize my PF for monthly withdrawals or resume contributions?

Ramalingam

Ramalingam Kalirajan  |6287 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Aug 27, 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
MAN Question by MAN on Jun 07, 2024Hindi
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My age 52,discontinued job since 8 yr(business) but kept PF &EPF intact so as to build compound inrest even if it is inactive active 1) Can I partially withraw PF 2) Is it any option for systemic withdral plan in PF ie every month 3) If I join new company ie at 52 age plus 8 yrs gap in PF contribution is it possible to continue PF contribution in old UAN for remaining 6 yrs 4) Is it possible to do PF contribution even after 58 yrs if I work part time/full time if emplyer has PF facility

Ans: Partial Withdrawal: Yes, you can partially withdraw from your PF for specific purposes like medical treatment, education, or marriage.

Systematic Withdrawal Plan: No, PF does not offer a monthly systematic withdrawal plan.

Continue PF with New Employer: Yes, you can continue contributing to the old UAN if you join a new company.

Contribution After 58 Years: Yes, you can continue PF contributions after 58 if you work full-time or part-time with an employer offering PF.

Best Regards,

K. Ramalingam, MBA, CFP

Chief Financial Planner

www.holisticinvestment.in
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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Ramalingam

Ramalingam Kalirajan  |6287 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 23, 2024

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hi, i have worked 5 different companies starting from 01.02.1992 to 31.08.2012 and contributed to PF as per the policy. i have passbook of PF account but only amount of last company is reflecting in the passbook. I have withdrawn EPF balance but EPS part is still not withdrawn from any company. my last company has not updated the records from previous companies, . i am getting 58 years next on 29042024. i have account with EPFO and UAN. How can i get the amount accumulated or get the scheme certificate or start pension at reduced rates...i am working with a company but not registered with PF.
Ans: Given your situation, consolidating and tracking your EPF contributions and benefits can be a bit challenging but certainly manageable. Here’s a step-by-step guide to help you navigate this:

Consolidation of UAN: If you have a UAN (Universal Account Number), ensure that all your previous PF accounts are linked to it. You can do this by logging into the EPFO portal and checking the 'Manage' tab under 'For Employees'. If your previous companies have not linked your UAN to their establishment IDs, you can request them to do so.
Transfer of EPF: Use the EPFO's online transfer portal to transfer the EPF accumulations from your previous accounts to your current PF account. This will consolidate all your PF accumulations into one account, making it easier to manage and track.
EPS (Employee Pension Scheme): Since you have not withdrawn the EPS contributions from any of your previous employers, you can apply for a scheme certificate through your current employer. A scheme certificate provides details of your service and contributions and can be used to avail pension benefits at the age of 58.
Pension at Reduced Rates: If you opt for pension before attaining the age of 58, it would be at a reduced rate. However, if you choose to defer it, your pension amount will increase. You can apply for a reduced pension through your current employer or directly with the EPFO after completing Form 10D.
Contact EPFO: If you face any issues or discrepancies in your PF accounts, reach out to the EPFO regional office or helpdesk. Provide them with the necessary details and documents, including your UAN, PF account numbers, and service details with each employer.
Consult a Financial Advisor: Given the complexities involved in EPF and EPS, consulting a financial advisor or a retirement planner can be beneficial. They can guide you through the process, help you understand the implications of withdrawing or transferring your EPF and EPS accumulations, and assist you in making informed decisions regarding your retirement benefits.
Remember, it's essential to keep track of your EPF and EPS contributions and benefits to ensure you maximize your retirement benefits and make informed decisions. Taking proactive steps now can help you secure a comfortable retirement.

..Read more

Ramalingam

Ramalingam Kalirajan  |6287 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jun 06, 2024

Asked by Anonymous - May 26, 2024Hindi
Money
I am 55 years old and lost the job I have PF corpus amount of 1 . My plan is to withdraw whole my PF amount and join another company . But my question is it good option to withdraw PF or continue the PF account and join other company so that my PF account will be active pl advice
Ans: When faced with the decision of whether to withdraw your Provident Fund (PF) corpus upon job loss or to maintain your PF account by joining another company, it's essential to carefully weigh the pros and cons. This decision can significantly impact your financial well-being in the short and long term. Let's break down the key considerations to help you make an informed choice.

Understanding the Provident Fund
The Provident Fund is a crucial component of retirement savings in India. It offers tax benefits, regular contributions from both employee and employer, and a decent interest rate. Withdrawing the PF corpus can provide immediate liquidity, while keeping the PF account active can ensure continued growth and future security.

Advantages of Withdrawing PF
Immediate Financial Relief
Withdrawing your PF corpus can offer immediate access to a substantial sum. This can be particularly helpful if you face financial difficulties due to job loss. It can provide a cushion to manage expenses and maintain your lifestyle during the transition period.

Debt Repayment
If you have any outstanding debts or loans, withdrawing your PF can help you clear these liabilities. Reducing or eliminating debt can lower financial stress and improve your overall financial health.

Investment Opportunities
Accessing your PF corpus can allow you to explore new investment opportunities. You might consider investing in diverse financial instruments to potentially earn higher returns compared to the PF interest rate. However, this requires careful planning and understanding of investment risks.

Disadvantages of Withdrawing PF
Loss of Retirement Savings
Withdrawing your PF corpus means depleting a significant portion of your retirement savings. This can impact your financial security in your post-retirement years, especially if you don't have other substantial savings or investments.

Tax Implications
Early withdrawal of PF before five years of continuous service can attract tax liabilities. The withdrawn amount becomes part of your taxable income, which could increase your tax burden significantly.

Compounded Growth Loss
By withdrawing your PF, you lose the benefit of compounded growth on your savings. The PF interest rate, compounded annually, helps your corpus grow over time. Withdrawing the amount halts this growth, impacting your long-term savings.

Benefits of Continuing PF Account
Continued Compounded Growth
Keeping your PF account active allows your savings to grow with the power of compounding. Even if you join another company, your new employer's contributions, combined with your own, will continue to enhance your PF balance.

Financial Security
Maintaining your PF account ensures you have a dedicated retirement fund. This financial cushion can be crucial during your retirement years, providing a steady source of income when you are no longer earning a regular salary.

Employer Contributions
When you join a new company, both you and your employer will continue contributing to your PF. This not only increases your savings but also adds to your financial stability over time.

Considerations Before Making a Decision
Age and Retirement Plans
At 55 years old, your retirement is relatively close. Withdrawing your PF now could impact your retirement plans. Assess your retirement goals and determine if you have sufficient savings and investments to support your desired lifestyle post-retirement.

Current Financial Needs
Evaluate your immediate financial needs versus your long-term goals. If you have other savings or sources of income, it might be wiser to keep your PF account active. However, if you are in urgent need of funds, withdrawing might be necessary.

Job Prospects
Consider the stability of your next job. If you are confident about securing a stable job with a steady income, keeping your PF account active is beneficial. However, if there is uncertainty, having immediate access to your PF corpus might provide financial security.

Managing Your PF and Future Investments
Diversification
Whether you decide to withdraw your PF or keep it active, diversification of your investments is crucial. A balanced portfolio can mitigate risks and enhance returns. Consider a mix of equity, debt, and other financial instruments based on your risk tolerance and investment horizon.

Consulting a Certified Financial Planner
Engaging a Certified Financial Planner (CFP) can provide you with tailored advice based on your unique financial situation. A CFP can help you create a comprehensive financial plan, ensuring your short-term needs and long-term goals are balanced effectively.

Regular Review
Regularly reviewing your financial plan and investment portfolio is essential. Life circumstances and financial markets change, and your strategy should adapt accordingly. Periodic reviews with a CFP can help you stay on track.


Losing a job at 55 can be challenging, but it's commendable that you are taking proactive steps to secure your financial future. Your diligence in considering the best options for your PF corpus demonstrates a responsible approach to financial planning. Remember, every decision has its pros and cons, and it's important to choose what aligns best with your overall financial goals.

Conclusion
Deciding whether to withdraw your PF corpus or keep your PF account active upon joining another company requires careful consideration of various factors. While immediate withdrawal provides liquidity, it can impact your long-term financial security. Conversely, maintaining your PF account ensures continued growth and future financial stability. Assess your immediate needs, retirement goals, and job prospects before making a decision. Consulting with a Certified Financial Planner can provide valuable guidance tailored to your unique situation.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |6287 Answers  |Ask -

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

Asked by Anonymous - May 29, 2024Hindi
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Hi Sir, Greetings! I worked in the company for 22 years. I resigned and moved to abroad for better opportunity. Currently my is 50 years and not withdrawn my EPF. I have the following query. 1. When can I withdraw my full EPF? 2. Upto what age I can earn interest on my EPF? 3. Tax on EPF interest.
Ans: Congratulations on your new opportunity abroad. It's great to see you're planning your EPF withdrawal wisely. Let's address your queries in detail.

When Can You Withdraw Your Full EPF?
You can withdraw your EPF under certain conditions:

Retirement: Full EPF withdrawal is allowed at the age of 58.

Unemployment: If you are unemployed for more than two months, you can withdraw your EPF.

Early Withdrawals
Partial Withdrawal: You can partially withdraw for specific reasons like home purchase, marriage, or education.

After 50: Since you are 50, you can withdraw up to 90% of your EPF one year before your retirement.

Upto What Age Can You Earn Interest on Your EPF?
Your EPF account earns interest until you withdraw the amount. However, there are important points to consider:

Active Accounts: As long as you are contributing, your EPF account remains active and earns interest.

Inactive Accounts: If there are no contributions for three years, your account becomes inactive.

Interest on Inactive Accounts
Interest Continuation: Even if your account is inactive, it continues to earn interest until the age of 58.

Post 58: After 58, interest is credited only if you have not withdrawn the EPF balance.

Tax on EPF Interest
Understanding the tax implications on EPF interest is crucial:

Exempted Interest: Interest earned on EPF is tax-free if you complete five continuous years of service.

Pre-Mature Withdrawal: If you withdraw before completing five years, interest is taxable.

Taxation on Withdrawals
After 5 Years: Withdrawals after five years are tax-free.

Before 5 Years: Taxable as per your income slab, and TDS is deducted if the amount exceeds Rs 50,000.

Analytical Insights
Full EPF Withdrawal at Retirement
Withdrawing EPF at 58 ensures you benefit from tax-free interest. Your funds continue to grow, providing a substantial retirement corpus.

Managing Inactive EPF Accounts
It's wise to keep track of your EPF account even if it's inactive. Ensure your KYC details are updated to avoid any complications during withdrawal.

Tax Planning
Consider tax implications before withdrawing your EPF. Plan withdrawals strategically to minimise tax liability.

Benefits of Regular Monitoring
Regularly monitor your EPF account to ensure it's earning interest. Update your bank details and KYC to avoid any issues during withdrawal.

Conclusion
By understanding when to withdraw your EPF, the interest it earns, and the tax implications, you can make informed decisions. Regular monitoring and strategic planning will help you maximise your EPF benefits.

Best Regards,

K. Ramalingam, MBA, CFP

Chief Financial Planner,

www.holisticinvestment.in

..Read more

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Moneywize   |149 Answers  |Ask -

Financial Planner - Answered on Sep 13, 2024

Asked by Anonymous - Sep 11, 2024Hindi
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I am 24-year-old salaried person. Monthly salary is 80k. I want to diversify 40k every month in large, mid and small cap mutual funds. Which plans should I choose? Please help as I am new to mutual funds.
Ans: To diversify your monthly salary of 40k into large, mid, and small-cap mutual funds, here are some options you can consider:

Large-Cap Mutual Funds:

• HDFC Large Cap Fund: This fund invests in large-cap companies with a proven track record. It has a consistent performance and is suitable for investors seeking capital appreciation.
• Axis Long Term Equity Fund: This fund aims to generate long-term capital growth by investing in a diversified portfolio of large-cap companies. It has a good track record and is suitable for investors with a long-term investment horizon.

Mid-Cap Mutual Funds:

• Kotak Emerging Equity Fund: This fund invests in mid-cap companies with the potential to outperform the market. It has a strong investment team and a good track record.
• Mirae Asset Mid Cap Fund: This fund focuses on mid-cap companies with growth potential. It has a diversified portfolio and a good risk-adjusted return.

Small-Cap Mutual Funds:

• Franklin Templeton Small Cap Fund: This fund invests in small-cap companies with high growth potential. It has a good track record and is suitable for investors with a higher risk appetite.
• ICICI Prudential Small Cap Fund: This fund invests in small-cap companies with the potential to generate significant returns. It has a diversified portfolio and a good risk-adjusted return.

Note:

• Investment Horizon: Consider your investment horizon before choosing funds. Small-cap funds typically have higher volatility, so they may not be suitable for short-term investments.
• Risk Tolerance: Assess your risk tolerance before investing. Large-cap funds are generally less volatile than mid-cap and small-cap funds.
• Diversification: Diversifying your investments across different asset classes and fund houses can help reduce risk.
• Regular Review: Regularly review your investments and make necessary adjustments based on your financial goals and market conditions.

Additional Tips:

• Start SIP: Consider starting a Systematic Investment Plan (SIP) to invest a fixed amount every month. This helps discipline your investments and average out the cost of purchase.
• Consult a Financial Advisor: If you are unsure about which funds to choose, consult a financial advisor who can provide personalized advice based on your financial goals and risk profile.

Remember, investing in mutual funds involves risks, and past performance is not indicative of future results. It's important to do thorough research or consult with a financial advisor before making any investment decisions.

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Ravi

Ravi Mittal  |296 Answers  |Ask -

Dating, Relationships Expert - Answered on Sep 13, 2024

Relationship
6monsth back I started talking to one of my colleague, he is attractive by his nature. Almost everyone likes him. he is intelligent, funny, etc.... In calls he used to tell me about his family, his friends, his thoughts, also about the girl (Aliya) whom he liked a lot for 6years (they belong to same village), but she rejected and told that he is her friend only. He told her that he may get feelings for her if they both remained as friends, so better stop talking. But she insisted that they both need to be friends and continue talking. I felt like may be she needed emotional support that's why she insisted. After coming to Jaipur, Aliya started talking to another man named Jitesh. But my colleague used to feel like a third wheel and started keeping distance. Then also she told that they are just friends and he need not distant himself. She always wanted him to give her the first priority. He also feared that she might get upset if he don't give her 1st priority. They used to talk a lot on phone and share everything. One day he brought her to our bay where we both used to sit and work. that day I really felt like I was a third wheel. I felt very bad.. cried for few days. And decided not to talk to him from then on because I didn't want to cry anymore. But he kept trying to have a talk with me. One day he almost cried because I was ignoring him. I couldn't see him like that and also I felt guilt about my behaviour(my intention was not to hurt him but to save my tears). I couldn't help but starting talking to him. He used to mention to me whenever he used to talk to her. and everytime I used to feel very bad. We started talking a lot after few weeks. Whenever I didn't receive proper response from him I used to become very anxious waiting for his reply and cried a lot. But when he starts talking again I used to feel normal. I never wanted to get into relationships, so everytime I used to tell him directly or indirectly about it. But still he continued to talk to me. One day he called me and said that Aliya is in love with Jitesh. He said being a friend he is very happy for her but after sometime he also said that if you also love someone I will stop talking with you also. I understand that he is little sad that he cannot talk to Aliya as he used to talk before because she is in love with someone else. We continued to talk and kept talking a lot. One day I felt like I am too much emotionally getting connected to him and felt like these long talks need to stop. So I asked him saying that I didn't get clarity. Then he opened up and proposed me. I thought for a day and I felt he is also a good person and said yes to him. Then on he became my world. Then on he started talking little less with other girls. One day Aliya called him saying that Jitesh had an incident where everyone thought he was drowned but he came back safely. She needed emotional support and asked him to come to office. She also said she that one of her colleagues didn't bring lunch and she don't have enough food to give her so she asked my colleague to prepare some food and bring it to office. At first my colleague said no thinking of me but Aliya convinced him emotionally saying that will you leave friends if you get a girlfriend and so he prepared lunch and took it to office. That day when he told me all these I felt devastated, I felt really insecured and cried a lot that is our first fight regarding her. He told me that if you say no I will stop talking to her. She again called and asked my colleague that what was my reaction for all these... he kept silent she guessed what might have happened and told that I understand how she might have felt and will not ask him to bring food to office anytime. Then on fights started increasing between us regarding her. whenever we three had a conversation i felt like thirdwheel and felt he is showing more attention towards her, more care towards her. again a fight. Like that fights started increasing. At first he used to listen to me, but after some days he started saying like my thinking is wrong. I even told him how much I cried but he didn't bothered. I never wanted to break their friendship so I never wanted to ask him to stop talking(even though he gave me that option). I only wanted him to give me my importance but I still feel he shows equal care to both of us. Then how am I different? Later on in our every fight, he started supporting her this gave me more pain. One day he said If I leave her for you, then I may leave you for someone else, that is not my character( this is contrary to what he said previously 'I will stop talking to her if i don't want to'). I cried a lot, I don't have much friends I couldn't share this with anyone.... every moment he is only coming to my thoughts and whenever fights happen due to Aliya, I get disturbed a lot... unable to concentrate on my work... not getting interest to do anything. One day out of anger I said just stop talking to her then his expressions totally changed he became hesistant , he became very sad and said I need sometime and don't know how much( his expression is contrary to what he said 'It doesn't bother me much If I don't talk to Aliya' ). He is that much emotionally connected to her. After 5mins I pinged him saying that I am feeling very guilt about the decision and ask him not to stop talking to her. I understood finally that he still thinks I am wrong and I am tired of fighting. One day when I was very emotional I told him that I will no more bring Aliya topic in our discussion and asked him to do whatever he wants. After this, Whenever Aliya calls him or he call her he used to tell me... sometimes I felt very bad... sometimes I tried to ignore as if it didn't bothered me but didn't start any argument with him. After few days he even stopped telling me if she called him or not also. When he was not telling about Aliya's conversations I thought he understood my feelings and reduced talking with her. but one time accidently my colleague's friend told about the small conversation that my colleague and Aliya had, that's how I came to know that they had a conversation but he didn't tell me. I felt very bad, really very bad... again unable to concentrate on work feel like crying all the time... I can't ask him to stop talking to her because I don't like to do so and also afraid of having negative impression on me in my colleague's mind. at the same time, I feel very very bad whenever they meet or have a call or does something together. I cannot discuss with him about this anymore. what shall i do, this is bothering me a lot and also having effect on my career, peace and life. please suggest. I am ready to correct myself if there is anything wrong from my end. And I can surely say that If i have a boy bestfriend then he would definitely not feel comfortable and will get upset.
Ans: Dear Jia,

When two people enter a relationship, both must try to make each other feel comfortable. If you are uncomfortable with your partner speaking to his friend, who is also his ex-crush, it is perfectly normal for you to voice it. And reading your question I understood that he has repeatedly mentioned that he had feelings for her, and even wanted to sever ties because staying in touch could only further ignite those feelings. I don't see how you are wrong in letting him know that you don't like their interactions. Plus, in a healthy relationship, the partner comes first. Not friends, especially not this kind of friendship.

Just understand that you are not wrong. Even if his intentions are pure and he looks at her like a friend, you have every right to express your feelings. You made no unreasonable demand. She wasn't "just" a friend; she was always more than that, and being insecure about something like that is not uncommon.

The only thing to do right now is to tell your boyfriend that you understand that the friendship is important but you deserve someone who can pick you over everything- obviously, reasonable things. See what he does. And please remember, you actually deserve someone who would pick you. This is not an ultimatum; it's the truth.

Best Wishes.

...Read more

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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