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Should I choose ECE at Thapar, CSE at Amrita or IT at IEM?

Ramalingam

Ramalingam Kalirajan  |9758 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 16, 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
Asked by Anonymous - Jun 17, 2024Hindi
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Sir,my aim was to study cse, now I have got electrical and computer in Thapar which costs around 5.4lakhs pa, amrita amaravati campus cse which costs around 3lakhs pa tuition fees, so it will go around 4-4.5 pa(including everything), and IEM in Kolkata IT branch which will cost around 7-8lakhs for 4years. Sir please guide me, money is not that much of a factor but I don't want to use my father's hard earned money, and would like to take a loan if the budget goes over 10lakhs. Sir please help me out as I am confused. Thank you.

Ans: Evaluating Your Options

You have three educational options:

Electrical and Computer Engineering at Thapar Institute.
Computer Science Engineering at Amrita Amaravati.
Information Technology at IEM Kolkata.
Let’s break down the financial aspects of each option to help you make an informed decision.

Cost Analysis

Thapar Institute:

Annual Cost: Rs 5.4 lakhs
Total for Four Years: Rs 21.6 lakhs
Amrita Amaravati:

Annual Tuition Fee: Rs 3 lakhs
Total for Four Years (including other expenses): Rs 12-15 lakhs
IEM Kolkata:

Total for Four Years: Rs 7-8 lakhs
Budgeting Considerations

Thapar Institute:

High Cost: The total cost of Rs 21.6 lakhs is significant.
Loan Requirement: Given the high cost, you might need to take a substantial loan, especially if the budget exceeds Rs 10 lakhs.
Amrita Amaravati:

Moderate Cost: Total cost is around Rs 12-15 lakhs, more manageable.
Potential Loan: You might need a smaller loan, making repayment easier.
IEM Kolkata:

Low Cost: Total cost is the most economical at Rs 7-8 lakhs.
Minimal Loan: If at all required, the loan amount would be minimal.
Personal Finance Impact

Parental Contribution vs. Loan

Thapar Institute: Requires a significant financial outlay or loan, impacting your family's finances. If a loan is taken, ensure that the interest rates and repayment terms are favorable.

Amrita Amaravati: More balanced in terms of cost. You might need a smaller loan, which would be easier to manage and repay.

IEM Kolkata: Least financial burden. If you prefer to minimize your family's financial stress, this is the best option.

Long-term Financial Planning

Return on Investment (ROI)

Thapar Institute: High ROI potential due to its strong reputation and placement record. However, the high initial cost needs to be justified by future earnings.

Amrita Amaravati: Good ROI with moderate costs. As it aligns with your preferred field (CSE), it offers a balanced investment with potentially good returns.

IEM Kolkata: Economical with good placement opportunities. Offers a favorable ROI with the least financial burden.

Loan Repayment

Thapar Institute: Higher loan amount means higher EMIs. Ensure you have a clear repayment plan based on your expected starting salary.

Amrita Amaravati: Moderate loan amount results in manageable EMIs. Easier to handle with a decent starting salary.

IEM Kolkata: Minimal loan requirement, if any. Loan repayment will be the least stressful.

Emergency Fund and Savings

Regardless of your choice, maintain an emergency fund for unforeseen expenses.

Plan to save a portion of your income post-graduation to build a financial cushion.

Final Insights

From a personal finance and budgeting perspective:

Amrita Amaravati strikes a balance between cost and your preferred field, making it a prudent choice with manageable financial implications.

Thapar Institute is a significant investment with potentially high returns but requires careful financial planning due to the higher costs involved.

IEM Kolkata offers the least financial strain and is a good option if minimizing costs is a priority.

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  |9758 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 02, 2024

Money
I am getting cse(cyber security) in KIIT bhubaneswar i am thinking of taking education loan around 16.5 lakh. What is your point of view on this? Please guide me ASAP
Ans: Taking an education loan for Rs 16.5 lakh to study Cyber Security at KIIT, Bhubaneswar, is a significant decision. Education loans can be beneficial but need careful consideration of various factors, including future career prospects, loan repayment capacity, and financial stability. Let’s explore this decision thoroughly to ensure it aligns with your future goals and financial well-being.

The Appeal of Cyber Security at KIIT, Bhubaneswar
Quality Education: KIIT, Bhubaneswar is known for its robust academic programs, especially in technology and engineering.

Emerging Field: Cyber Security is a rapidly growing field with increasing demand for skilled professionals worldwide.

Career Opportunities: Graduates in Cyber Security can find rewarding job opportunities in various sectors, including IT, finance, and government.

State-of-the-Art Facilities: KIIT offers excellent facilities, including labs and research centers, that provide a practical learning environment.

Global Perspective: The university’s strong emphasis on global education and industry connections can enhance your learning experience.

Evaluating the Education Loan Option
Taking a loan to finance your education is a common practice, but it’s essential to weigh the benefits and challenges.

Benefits of an Education Loan
Accessible Funds: Loans provide immediate funds to cover tuition and other expenses, making quality education more accessible.

Investment in Future: Education loans can be viewed as an investment in your future career and earning potential.

Flexible Repayment: Many education loans offer flexible repayment options and a grace period after graduation before payments start.

Tax Benefits: Under Section 80E of the Income Tax Act, you can claim tax deductions on the interest paid on education loans.

Challenges of an Education Loan
Long-Term Commitment: Loans are a long-term financial commitment that requires careful planning and budgeting for repayment.

Interest Accumulation: Interest on education loans can accumulate over time, increasing the total amount repayable.

Repayment Pressure: The need to repay the loan can add pressure to secure a high-paying job immediately after graduation.

Credit Impact: Failure to repay the loan on time can negatively impact your credit score and financial future.

Planning for Loan Repayment
Repaying an education loan requires strategic planning to ensure it doesn’t become a burden on your finances.

Understanding Loan Terms
Interest Rates: Compare the interest rates offered by different lenders to find the most favorable terms.

Repayment Period: Consider the repayment period and how it aligns with your expected income post-graduation.

Grace Period: Take note of the grace period before repayments begin, typically offered to allow graduates time to find employment.

EMI Calculations: Use EMI calculators to understand your monthly repayment obligations and plan your budget accordingly.

Creating a Repayment Plan
Budgeting: Develop a monthly budget that includes loan repayments and essential living expenses.

Savings: Start a savings plan to build a financial cushion for loan repayments and emergencies.

Part-Time Work: Consider part-time work during your studies to reduce the loan amount or cover personal expenses.

Loan Prepayment: If possible, make prepayments on your loan to reduce the principal and overall interest burden.

Exploring Income Sources
Job Prospects: Research job prospects in Cyber Security to understand potential starting salaries and growth opportunities.

Scholarships: Explore scholarships, grants, and financial aid options that could reduce the amount you need to borrow.

Internships: Look for internships during your studies to gain experience and possibly earn additional income.

Freelancing: Utilize your skills in Cyber Security to take on freelance projects and boost your earnings.

Assessing Alternatives to Loans
While loans are a viable option, it’s important to consider other ways to fund your education.

Parental Support
Family Contributions: Discuss with your family if they can support part of your education expenses, reducing the loan amount needed.

Savings: Utilize any personal or family savings earmarked for education to minimize borrowing.

Cost Sharing: Consider splitting education costs with family members to ease the financial burden.

Scholarships and Grants
Merit-Based Scholarships: Apply for scholarships based on academic performance or achievements in Cyber Security.

Need-Based Grants: Look for grants that consider your financial need and can provide non-repayable funds.

University Aid: Explore financial aid options provided by KIIT, such as scholarships, fee waivers, or work-study programs.

Work-Study Programs
On-Campus Jobs: Many universities offer on-campus jobs that can help you earn money while studying.

Assistantships: Explore opportunities for teaching or research assistantships that provide stipends or tuition reductions.

Part-Time Work: Consider off-campus part-time jobs that align with your study schedule and can supplement your income.

Investing in Your Future
Taking a loan for education can be seen as a strategic investment in your future. Here’s how to maximize the return on this investment.

Leveraging Your Education
Skill Development: Focus on developing in-demand skills in Cyber Security to enhance your employability and career prospects.

Networking: Build a strong professional network through internships, seminars, and industry events.

Certifications: Pursue additional certifications in Cyber Security to increase your qualifications and marketability.

Research Opportunities: Engage in research projects or publications that can add value to your resume and knowledge base.

Career Planning
Job Market Research: Stay informed about the job market trends and demands in Cyber Security.

Career Services: Utilize the career services offered by KIIT to assist with job placements and career planning.

Resume Building: Create a strong resume and cover letter that highlight your skills, experience, and achievements in Cyber Security.

Interview Preparation: Prepare thoroughly for job interviews by practicing commonly asked questions and refining your answers.

Financial Planning Post-Graduation
Income Management: Plan how to manage your income effectively once you start earning to balance living expenses and loan repayments.

Emergency Fund: Build an emergency fund to cover unexpected expenses and financial uncertainties.

Investment Strategies: Consider investing a portion of your income in growth-oriented assets for long-term wealth building.

Debt Reduction: Prioritize paying off high-interest debts and loans to achieve financial freedom sooner.

Final Insights
Deciding to take an education loan for studying Cyber Security at KIIT, Bhubaneswar, is a significant step towards securing your future. While loans provide the necessary funds, they come with long-term repayment responsibilities. It’s essential to carefully evaluate your financial situation, job prospects, and alternative funding options before committing. With a well-thought-out plan, you can leverage this investment in your education to achieve your career goals and financial stability.

Remember, every step you take today towards managing your finances wisely will pay off in the long run. Whether it’s balancing loan repayments or planning for your future career, your efforts will lead to success.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Latest Questions
Ramalingam

Ramalingam Kalirajan  |9758 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 16, 2025

Money
Hi I am 46.working in Pvt sector. Able to save 10000rs per month. Don't have much savings or investment. Kindly guide me how to invest this amount to build up a good corpus in coming 10 years
Ans: You are 46 years old and saving Rs.10,000 every month. You want to create a strong investment plan for the next 10 years. You do not have much existing savings. That’s perfectly okay. You are ready to act now. That’s what matters.

Here is a detailed, simple, and practical 360-degree plan.

? Understand your financial starting point
– You are 46 years old, working in private sector.
– You are able to save Rs.10,000 monthly.
– You have minimal past savings or investments.
– You have not mentioned any LIC, ULIP, or insurance-based investments.
– You are now planning for a better financial future in 10 years.

That’s a great and timely decision.

? Clarify your financial goals
– Think about what you want after 10 years.
– Is it retirement? Or a second income source?
– Or your child’s higher education or marriage?
– Having a clear goal helps in better investment planning.
– You can define your goal in simple terms.
– Also, prioritise between must-have goals and good-to-have goals.

This brings better clarity and commitment.

? Monthly savings are your superpower
– Rs.10,000/month may look small. But it’s powerful.
– In 10 years, it can create meaningful wealth.
– Consistency is more important than amount.
– Keep saving without breaks.
– Even in tough months, try not to skip SIPs.

Discipline is your biggest strength now.

? Emergency fund is your safety net
– You should first build a safety buffer.
– Set aside 6 months of your monthly expenses.
– If monthly expense is Rs.30,000, build Rs.1.8 lakh buffer.
– Start with Rs.1 lakh in savings and liquid fund.
– Keep 30% in savings bank. Keep 70% in liquid fund.
– Avoid fixed deposits. Early withdrawal charges reduce returns.
– Liquid funds are better than savings.
– They offer next-day withdrawal and better returns.

Build emergency fund first. Then start investing for long-term goals.

? Avoid index funds for long-term wealth creation
– Index funds are unmanaged. They just copy the market index.
– They don’t protect you during falling markets.
– They drop fast during crashes.
– They don’t adjust to changing market conditions.
– You need smart fund management for long-term growth.
– Actively managed funds are better.
– They are run by professional fund managers.
– These managers buy or sell based on research.
– You benefit from their market insights.
– In India, actively managed funds have outperformed index funds.

Index funds may look cheap. But they cost returns in long run.

? Avoid direct plans if you are not an expert
– Direct plans don’t give you guidance.
– You must decide fund, amount, changes, rebalancing – all on your own.
– No help during volatile markets.
– No suggestions when your goals change.
– Regular plans through a Certified Financial Planner (CFP) give guidance.
– You get support in fund selection and goal planning.
– CFPs help you avoid costly mistakes.
– They also review your portfolio regularly.
– Regular plans help you stay invested calmly.
– Investing is not just numbers. It’s also behaviour.

Handholding matters more than small expense ratio difference.

? Begin with 2–3 strong equity mutual funds
– Start with only 2 or 3 diversified equity funds.
– Choose Flexi Cap and Large & Midcap categories.
– These give good mix of large and mid companies.
– Add a Balanced Advantage Fund for market stability.
– These funds shift between equity and debt automatically.
– You don’t need to monitor markets daily.
– Avoid sector funds, international funds, thematic funds.
– They are risky and not suitable for your stage.
– Don’t try to pick many funds.
– Few good funds are enough.

Over-diversification leads to confusion, not better returns.

? Allocate SIP amounts with simplicity
– You can start SIP of Rs.4,000 in Flexi Cap fund.
– Rs.3,000 in Large & Midcap fund.
– Rs.3,000 in Balanced Advantage fund.
– Total = Rs.10,000/month.

This is simple and powerful allocation.

? Increase SIPs every year
– Try to increase your SIPs by 5–10% yearly.
– If income rises, increase investments first before expenses.
– Even Rs.1,000 extra per year makes a big difference.
– Over 10 years, this boosts final corpus strongly.

Growth in SIP is more important than one-time investments.

? Keep equity investments long term
– Don’t withdraw before 10 years.
– Let the money grow through compounding.
– Equity markets have ups and downs.
– But they reward patient investors over time.
– If you panic in short term, you lose returns.

Time is your best friend in equity.

? Avoid investment-linked insurance policies
– Don’t mix insurance with investment.
– LIC policies, endowment plans, ULIPs give poor returns.
– They promise returns, but deliver less than inflation.
– Keep insurance separate and simple.
– Buy term insurance if not already taken.
– Premium is low, cover is high.

Investment-cum-insurance products dilute both goals.

? Review portfolio every year
– Fund performance must be tracked once a year.
– Change the fund if it underperforms for 2 years.
– Rebalance if one fund grows too big.
– Your Certified Financial Planner will help with review.
– Don’t switch funds often. Review, not react.

Long-term success comes from patience and planning.

? Understand tax impact of mutual funds
– Long Term Capital Gains above Rs.1.25 lakh are taxed at 12.5%.
– Short Term Capital Gains are taxed at 20%.
– For debt funds, both gains are taxed as per your tax slab.
– Plan your withdrawals smartly.
– Take help of your CFP before redeeming.

Tax planning can save you big money.

? Stay away from risky investments
– Don’t invest in stock tips or small companies.
– Don’t try F&O or day trading.
– Stay away from chit funds and ponzi schemes.
– Don’t follow friends or relatives blindly.

Stick to mutual funds with professional guidance.

? Stay consistent with your plan
– Don’t stop SIPs due to short-term events.
– Avoid taking emotional decisions based on news.
– Focus on your goals, not market noise.
– Investing is like growing a tree.
– Give time, water it regularly, don’t uproot.

Consistency builds wealth quietly and surely.

? Create financial discipline in your life
– Avoid unnecessary expenses.
– Track your income and spending.
– Set automatic SIPs.
– Pay off credit card bills fully.
– Don’t take loans for gadgets or travel.
– Start saving before spending.

Good habits support good investments.

? Finally
– You are starting at 46, but that’s not late.
– Many people don’t start at all.
– Rs.10,000/month for 10 years with right discipline is powerful.
– Focus on quality funds.
– Stick to your goals.
– Review annually.
– Stay invested with the help of a Certified Financial Planner.
– Avoid direct plans if you’re not hands-on.
– Avoid index funds.
– Build emergency fund first.
– Increase SIP yearly.
– Don’t stop investing.
– Your 10-year wealth plan is now in motion.

Let your money work quietly. You stay focused and calm.

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

...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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