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Advait

Advait Arora  |1263 Answers  |Ask -

Financial Planner - Answered on Jun 06, 2023

Advait Arora has over 20 years of experience in direct investing in stock markets in India and overseas.
He holds a masters in IT management from the University Of Wollongong, Australia, and an MBA in marketing from Charles Strut University, NewCastle, Australia.
Advait is a firm believer in the power of compounding to help his clients grow their wealth.... more
senthilmurugan Question by senthilmurugan on May 30, 2023Hindi
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bank of india buy at this level

Ans: on dips maybe yes. it is improving its results every time, which is a good sign
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  |5061 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 19, 2024

Asked by Anonymous - Jul 14, 2024Hindi
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Hi, I'm 33 yr old and have dependent house wife, 3 yr kid and both parents of 60 yr age. I've in-hand salary after tax is 1.4 Lacs per month and have 40 lac home loan for 10 yrs for a home in village, and I'm staying in rented flat in different city. No Fd, mutual funds and have 12 Lacs in pf. Current Monthly expenses of 50 thousand per month. Home Loan emi if 48k monthly. Have a life insurance of 10 lac for 20 yrs and emergency fund of 5lcs How do I plan my child education and my retirement at the age of 45 yrs.?
Ans: Current Financial Situation
You are 33 years old with a monthly in-hand salary of Rs 1.4 lakhs.

You have a dependent wife, a 3-year-old child, and parents aged 60 years.

You have a home loan of Rs 40 lakhs for 10 years, with a monthly EMI of Rs 48,000.

You live in a rented flat in a different city.

Your monthly expenses are Rs 50,000.

You have no fixed deposits or mutual funds.

You have Rs 12 lakhs in your provident fund.

You have a life insurance policy worth Rs 10 lakhs for 20 years.

You have an emergency fund of Rs 5 lakhs.

Financial Goals
Plan for your child’s education.

Retire at the age of 45.

Evaluation and Analysis
Emergency Fund
Your emergency fund is a good start. Ensure it covers at least six months of expenses.

Provident Fund
Your provident fund of Rs 12 lakhs is a secure investment. Continue contributing to it regularly.

Life Insurance
Your life insurance coverage is low. Increase it to at least Rs 1 crore to protect your family.

Home Loan
Your home loan EMI of Rs 48,000 is manageable but limits your savings capacity.

Recommendations
Increase Savings
Allocate a portion of your salary to increase your savings.

Aim to save at least 20% of your monthly income.

Child’s Education Fund
Start a Systematic Investment Plan (SIP) in a diversified equity mutual fund.

Invest Rs 10,000 per month for your child’s education.

Consider education-specific funds for better returns.

Retirement Planning
Increase your retirement corpus by starting another SIP in an equity mutual fund.

Invest Rs 20,000 per month towards your retirement fund.

Diversify into debt funds for stability as you approach retirement age.

Health Insurance
Secure a comprehensive health insurance plan for your family.

Ensure your parents are also covered under a separate health insurance policy.

Review Investments
Avoid direct mutual funds; instead, invest through a Certified Financial Planner.

Actively managed funds can offer better returns than index funds.

Reduce Debt
Aim to prepay your home loan whenever possible to reduce the interest burden.

Use any bonuses or extra income to make prepayments.

Final Insights
Your financial discipline is commendable. Increase your life insurance coverage and savings.

Start SIPs in diversified equity mutual funds for your child's education and retirement.

Secure comprehensive health insurance for your family.

Plan for home loan prepayments to reduce debt faster.

Review your investments annually with a Certified Financial Planner.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

...Read more

Ramalingam

Ramalingam Kalirajan  |5061 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 19, 2024

Asked by Anonymous - Jul 14, 2024Hindi
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I am 25 and investing around 44k per month in SIPs. 11k in quant small cap, 10k in nippon small cap, 5k in icici prudent technology direct fund, 5k in icici prudent bharat 22 fof direct, 7k in HDFC small cap, 1k in 360 one focused equity fund, 1k in axis growth opportunities fund direct, 2k each in quant psu direct and quant infrastructure fund, and 200 in HDFC infrastructure. Is this mix good for a 10-15 year term
Ans: Assessment of Your Current Portfolio
You are investing Rs 44,000 per month in a variety of mutual funds. Here’s an assessment of your current portfolio:

Quant Small Cap Fund: Rs 11,000
Nippon Small Cap Fund: Rs 10,000
ICICI Prudential Technology Direct Fund: Rs 5,000
ICICI Prudential Bharat 22 FoF Direct: Rs 5,000
HDFC Small Cap Fund: Rs 7,000
360 One Focused Equity Fund: Rs 1,000
Axis Growth Opportunities Fund Direct: Rs 1,000
Quant PSU Direct Fund: Rs 2,000
Quant Infrastructure Fund: Rs 2,000
HDFC Infrastructure Fund: Rs 200
Portfolio Analysis
Strengths
Aggressive Growth Potential: Your investments in small cap and sector-specific funds indicate a focus on aggressive growth.

Sector Diversification: Exposure to sectors like technology, infrastructure, and public sector units provides sectoral diversification.

Weaknesses
High Risk: A significant portion of your portfolio is in small cap and sector-specific funds, which are high-risk investments.

Over-Diversification: Investing small amounts in many funds (e.g., Rs 200 in HDFC Infrastructure Fund) may not yield significant returns.

Concentration in Small Caps: Heavy investment in small cap funds could increase volatility and risk.

Recommendations for Improvement
Balanced Diversification
Reduce Overlap: Avoid investing in too many similar funds. This will simplify your portfolio and improve potential returns.

Include Large Cap Funds: Adding large cap funds will provide stability and reduce overall portfolio risk.

Increase Focused Investments: Instead of spreading small amounts across many funds, focus on a few well-performing funds to maximize growth.

Quality Over Quantity
Consistent Performers: Focus on funds with a proven track record of consistent performance rather than chasing the latest trends.

Consult a CFP: To avoid costly mistakes, seek advice from a Certified Financial Planner. They can guide you in choosing consistently performing funds.

Strategic Allocation
Core-Satellite Approach: Allocate a core portion of your investments in diversified equity funds (large, mid, small cap) and a smaller portion in sectoral/thematic funds.

Periodic Review: Regularly review and rebalance your portfolio to align with your financial goals and market conditions.

Suggested Portfolio Structure
Core Investments
Large Cap Funds: Allocate 30-40% to large cap funds for stability.

Multi Cap Funds: Allocate 20-30% to multi cap funds for diversified growth.

Satellite Investments
Small Cap Funds: Allocate 20% to small cap funds for aggressive growth.

Sectoral/Thematic Funds: Allocate 10-20% to sector-specific funds (technology, infrastructure) based on market conditions and trends.

Emergency Fund and Debt Allocation
Emergency Fund: Maintain an emergency fund in liquid assets (equivalent to 6 months’ expenses).

Debt Funds: Allocate 10-20% to debt funds for fixed income and reduced risk.

Final Insights
Your portfolio shows a strong inclination towards growth with high-risk, high-reward funds. Balancing this with stable, consistent performers will help in achieving long-term financial goals with reduced risk. Regular consultation with a Certified Financial Planner and periodic portfolio reviews will ensure alignment with market dynamics and personal financial objectives.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

...Read more

Ramalingam

Ramalingam Kalirajan  |5061 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 19, 2024

Asked by Anonymous - Jul 14, 2024Hindi
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I am 50 years old and my salary is 47000. My husband warns 1.5 lacs but we are in a process of divorce. I have only daughter her educational expanses are borne by her father. Till now I am having full medical facility from ny husbands company but I dont know whether divorce will be finalized or not. If divorce happens I wont get his medical facilities. I had started mutual fund 4000 sip in SBI flexi cap fund. I have lumpsum of 130000 in multi cap fund. I have also started sip in sbi contra and large and micap fund. I jave 40000 in multicap and sbi sensex fund in a different folio. I have a RD of 15000 per month which will mature in 2025 April. I have fixed deposit of 250000. I have invested 1.5 lacs in DBS Stock broker agency which give me monthly 12000 interest. Again I have gold of about 8 lacs. I dont have house or a car. I want to have a comfortable retirement and also travel. My only expanse now is to pay the lawyer average 3k per month. My job travel cost is 5k per month.So how should I manage my wealth.
Ans: Current Financial Situation
You are 50 years old with a salary of Rs 47,000 per month.

Your husband earns Rs 1.5 lakhs per month, but you are in the process of getting a divorce.

Your daughter’s educational expenses are covered by her father.

You currently receive full medical coverage from your husband’s company.

You are unsure if you will retain these medical benefits post-divorce.

Investments and Savings
You have a SIP of Rs 4,000 in a flexi-cap mutual fund.

You have Rs 1,30,000 invested in a multi-cap fund.

You have SIPs in contra and large & mid-cap funds.

You hold Rs 40,000 in a multi-cap fund and a Sensex fund.

You have a recurring deposit (RD) of Rs 15,000 per month, maturing in April 2025.

You have a fixed deposit (FD) worth Rs 2,50,000.

You invested Rs 1,50,000 in DBS Stock Broker Agency, receiving Rs 12,000 monthly interest.

You own gold worth Rs 8 lakhs.

Expenses
Your average monthly lawyer fee is Rs 3,000.

Your job travel costs Rs 5,000 per month.

Goals
You aim for a comfortable retirement with the ability to travel.
Evaluation and Analysis
Diversified Investment Strategy
Your investment portfolio is diversified. You have SIPs in multiple funds, fixed deposits, and gold. This helps mitigate risks and ensures stability.

Mutual Fund Investments
Actively managed funds can outperform index funds due to professional management. Avoid direct funds, which might seem cheaper but lack expert guidance. Invest through a certified financial planner to maximize returns.

Fixed Deposits and Recurring Deposits
Fixed deposits and recurring deposits provide stability but offer lower returns compared to equity funds. Diversify further into equity to balance growth and security.

Stock Broker Investment
The Rs 1,50,000 investment yielding Rs 12,000 monthly interest is beneficial. However, ensure you understand the risks and sustainability of this return.

Gold Investment
Gold is a good hedge against inflation and adds to your diversified portfolio. Keep this investment as it provides liquidity in emergencies.

Recommendations
Emergency Fund
Maintain an emergency fund covering at least 6 months of expenses. Your FD and gold investments can act as a buffer, but consider keeping some liquid cash.

Health Insurance
Post-divorce, you might lose medical coverage. Secure a comprehensive health insurance plan for yourself. This will prevent financial strain due to medical emergencies.

Retirement Planning
Continue SIPs in actively managed funds for higher returns.

Increase SIP contributions if possible, especially in equity funds.

Consider diversifying into debt mutual funds for stability.

Evaluate the performance of your current funds annually and make necessary adjustments.

Travel Goals
Plan for travel expenses by setting aside a portion of your investments. Use the interest from your stock broker investment for travel, ensuring it doesn't impact your retirement corpus.

Legal Expenses
Manage legal expenses efficiently. Use part of your monthly income or interest from investments to cover these costs.

Final Insights
Your diversified investment strategy is commendable. Maintain this approach for balanced growth and stability.

Secure a health insurance plan post-divorce to safeguard against medical emergencies.

Continue and increase SIPs in actively managed mutual funds for higher returns.

Reevaluate your portfolio annually with a certified financial planner to stay aligned with your financial goals.

Set aside funds specifically for travel to enjoy a comfortable retirement.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

...Read more

Ramalingam

Ramalingam Kalirajan  |5061 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 19, 2024

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Hi I am 31 yrs monthly income 95000. Home loan 30lakhs plus person loan 7lakhs doing a lic of 5000 per month and no other investment but have the balance salary gets used for monthly expenses can you pls help me to plan how to repay my home loan also my investment plan for retirement
Ans: You are 31 years old with a monthly income of Rs 95,000.

You have a home loan of Rs 30 lakhs and a personal loan of Rs 7 lakhs.

You are paying Rs 5,000 per month for LIC.

Your remaining salary is used for monthly expenses.

Financial Goals
Repay Home Loan
Investment Plan for Retirement
Repaying Your Loans
Home Loan Repayment
Increase EMI Payments: If possible, increase your EMI payments to reduce the loan tenure and interest cost.

Part-Payments: Make part-payments whenever you receive a bonus or extra income to reduce the principal amount.

Loan Restructuring: Consider restructuring your loan for better terms if interest rates decrease.

Personal Loan Repayment
Prioritize Personal Loan: Personal loans generally have higher interest rates than home loans. Focus on repaying this first.

Consolidate Loans: If feasible, consolidate your personal loan into your home loan for a lower interest rate.

Monthly Budgeting
Expense Management
Track Expenses: Use an app or spreadsheet to track your monthly expenses.

Cut Unnecessary Costs: Identify and reduce unnecessary expenses to increase savings.

Investment Plan for Retirement
Building an Emergency Fund
Emergency Fund: Save at least 6 months' worth of expenses in a liquid fund for emergencies.
Systematic Investment Plan (SIP)
Start SIPs: Invest a fixed amount monthly in mutual funds through SIPs. Diversify across large-cap, mid-cap, and multi-cap funds.

Consistent Investing: Invest consistently for long-term growth and compounding benefits.

Diversification and Risk Management
Diversified Portfolio: Create a diversified portfolio with a mix of equity, debt, and other instruments.

Regular Review: Review and rebalance your portfolio periodically to align with your financial goals.

Insurance Coverage
Health and Life Insurance
Adequate Cover: Ensure you have adequate health insurance and life insurance cover. Consider term insurance for life cover.
Professional Guidance
Consulting a CFP
Seek Advice: Consult a Certified Financial Planner (CFP) for tailored financial advice.

Avoid Mistakes: Professional guidance can help you avoid costly investment mistakes.

Final Insights
To effectively manage your loans and plan for retirement, focus on reducing high-interest debts first. Consistently invest in a diversified portfolio through SIPs and maintain a disciplined approach to savings. Seek professional advice from a Certified Financial Planner to ensure your financial goals are met with minimal risk.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

...Read more

Ramalingam

Ramalingam Kalirajan  |5061 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 19, 2024

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I am 34 years old. My salary 55k. I have a home loan of 35 lakhs monthly EMI 27k for 25 years from 2023. From April 2024 I started invested in mutual fund and index fund, sbi long term equity fund 2k, sbi Magnum global fund 2k, sbi focused equity fund 2k, sbi bluechip fund 2k, hdfc nifty index fund 3k, hdfc nifty bank index 3k. I want to invest for 20 years. Approx how much amount I got in 2055
Ans: You are 34 years old with a salary of Rs 55k per month.

You have a home loan of Rs 35 lakhs with a monthly EMI of Rs 27k for 25 years from 2023.

You started investing in mutual funds and index funds from April 2024.

Current Investments
SBI Long Term Equity Fund: Rs 2k per month

SBI Magnum Global Fund: Rs 2k per month

SBI Focused Equity Fund: Rs 2k per month

SBI Bluechip Fund: Rs 2k per month

HDFC Nifty Index Fund: Rs 3k per month

HDFC Nifty Bank Index Fund: Rs 3k per month

Investment Strategy
Consistency Over Time
Regular SIPs: Continue your SIPs regularly without interruptions.

Long-Term Horizon: Invest for at least 20 years to benefit from compounding.

Diversification and Risk Management
Diversification: Your portfolio is well-diversified across equity funds and index funds.

Risk Management: Monitor your funds regularly and rebalance if necessary.

Expected Returns
Growth Potential
Equity Mutual Funds: Historically, equity mutual funds have provided 10-12% annual returns.

Index Funds: Typically, index funds give returns close to the market average, around 8-10%.

Approximate Future Value
Assumptions: Assuming an average return of 10% per annum for your portfolio.

SIP Calculation: Use an SIP calculator to estimate the future value of your investments.

Analytical Insights
Importance of Monitoring
Regular Review: Review your portfolio at least once a year.

Adjustments: Make adjustments based on performance and changes in financial goals.

Professional Advice
Consult a CFP: For tailored advice, consult a Certified Financial Planner (CFP).

Avoid Mistakes: Professional guidance can help you avoid costly investment mistakes.

Additional Considerations
Emergency Fund
Liquidity: Ensure you have an emergency fund equivalent to 6-12 months' expenses.

Safety Net: This provides a financial cushion during unforeseen circumstances.

Insurance Coverage
Health Insurance: Ensure you have adequate health insurance coverage for yourself and dependents.

Life Insurance: Consider a term insurance plan for financial security for your family.

Final Insights
Your current investment strategy is sound, focusing on a mix of equity and index funds. Maintain consistency with your SIPs and monitor your portfolio regularly. Seek professional advice from a Certified Financial Planner to ensure your investments align with your long-term goals. With disciplined investing and proper planning, you can achieve your financial goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

...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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