Home > Money > Question
Need Expert Advice?Our Gurus Can Help
Omkeshwar

Omkeshwar Singh  | Answer  |Ask -

Head, Rank MF - Answered on Sep 21, 2022

Mutual Fund Expert... more
rajesh Question by rajesh on Sep 21, 2022Hindi
Listen
Money

My current age is 44 and my current monthly take home salary is 1.40 lakh per month. Please review my investment and suggest me is my current investment is okay or I am investing wrong way. After 7 years I want Rs 60 lakh for my daughter higher studies
after next 7 years I want Rs 60 lakh for my son’s studies and after my retirement how can get Rs 3 crore after 60 years of age.

  • SIP - Rs 15000 / - per month from 2019 till 2034
  • Home loan - Rs 27000 per month for 20 years
  • Car loan - Rs 19000 Per month for 7 years
  • Sukanya Samriddhi - 6300 Per month from 2019 till 2037

Ans: SIP of Rs 15000 will create a corpus of Rs 21 lakh and in next 7 years also the same amount (since the corpus is taken out in 7th year).

The SIP amount needs to be much higher!

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.
Money

You may like to see similar questions and answers below

Ramalingam

Ramalingam Kalirajan  |5092 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 25, 2024

Listen
Money
I am 36 years old, married. I am investing 45k per month on SIP ( 22k Nifty 50 UTI, 10K parag parekh, 8k SBI small cap, 5k Mid cap) , 10k in PPF, 7k NPS, 5k on stocks as investment. I have EPF as well 16k per month. I am planning to buy a house and I also I pay rent of 16k currently. I have a small flat of home loan 14k. Sir plz do let me know if my investment choice is fine or not. Also I want to have a pension of 70k-1 lac when I retire in my home town.
Ans: It's commendable to see your commitment towards saving and investing at such a young age. Let's delve into your current investment strategy and future goals.

Your SIP investments across different categories indicate a diversified approach, which is good. However, it's essential to review the performance of these funds periodically and ensure they align with your risk tolerance and financial goals.

The allocation towards PPF and NPS reflects a mix of long-term savings and retirement planning, which is a prudent move.

Considering your plan to buy a house and current home loan, it's crucial to balance your investments with your liabilities. Also, with rent and EPF contributions, ensuring sufficient liquidity for short-term needs and emergencies is vital.

For your retirement goal of having a pension of 70k-1 lac, you might want to consider increasing your NPS contributions or exploring other pension-oriented investment avenues.

A Certified Financial Planner can provide personalized advice tailored to your financial situation, goals, and risk tolerance. They can help you optimize your investment portfolio, guide you on balancing investments with your future home purchase, and align your retirement savings with your desired pension.

Remember, financial planning is a dynamic process, and it's essential to review and adjust periodically to stay on track towards your goals. Best wishes for your financial journey ahead!

..Read more

Ramalingam

Ramalingam Kalirajan  |5092 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 13, 2024

Asked by Anonymous - May 08, 2024Hindi
Listen
Money
My current age is 30 and my current monthly take home salary is 40K per month. and My Wife Age is 29 her Salary 20K Per Month Please review my investment and suggest me is my current investment is okay or I am investing wrong way. After 15 years I want Rs 80 lakh for my daughter higher studies after next 7 years I want Rs 30 lakh for For Buying Land and after my retirement how can get Rs 2 crore after 60 years of age. SIP - Rs 10000 / - per month from 2019 till 2040 HDFC Mid Cap Plan- 3000 Paragparikh FlexiCap Plan-2000 Sbi Small Cap Plan-3000 SBI LARG And Mid Cap -2000 Home loan - Rs 7000 per month for 10 years Sukanya Samriddhi - 2000 Per month from 2019 till 2039 I Also Read To Invest More 5K Sip, Please Give You Advise.
Ans: Financial Review and Recommendations

Current Investment Analysis:

Your investment portfolio reflects a mix of equity mutual funds, Sukanya Samriddhi Yojana (SSY), and a home loan. Here's an analysis of your current investments:

Equity Mutual Funds (SIPs):

HDFC Mid Cap Fund: Rs. 3,000/month
Parag Parikh FlexiCap Fund: Rs. 2,000/month
SBI Small Cap Fund: Rs. 3,000/month
SBI Large and Mid Cap Fund: Rs. 2,000/month
Sukanya Samriddhi Yojana (SSY): Rs. 2,000/month

Home Loan: Rs. 7,000/month for 10 years

Financial Goals:

Daughter's Higher Studies (15 years): Target corpus: Rs. 80 lakhs
Buying Land (7 years): Target corpus: Rs. 30 lakhs
Retirement (After 60 years): Target corpus: Rs. 2 crores
Recommendations:

Review Asset Allocation: Your portfolio is heavily skewed towards equity mutual funds, which are suitable for long-term goals. However, ensure you have a balanced allocation across asset classes to manage risk effectively. Consider diversifying into debt or other low-risk instruments for short-term goals like buying land.

SIP Review:

Evaluate the performance of your existing SIPs and consider diversifying into different fund categories for better risk management.
Since your daughter's higher education goal is 15 years away, continue investing in equity funds but review and adjust the SIP amounts periodically based on fund performance and market conditions.
New SIP Allocation:

Allocate the additional Rs. 5,000/month SIP towards debt mutual funds or Public Provident Fund (PPF) for your short-term goal of buying land. This will provide stability and liquidity for the goal.
For long-term goals like retirement, consider increasing contributions to equity mutual funds gradually over time to benefit from compounding returns.
Emergency Fund: Ensure you have an adequate emergency fund set aside in a liquid and easily accessible instrument to cover unforeseen expenses.

Insurance Coverage: Consider investing in term insurance and health insurance policies to protect your family's financial future against unforeseen events.

Regular Review: Periodically review your investment portfolio's performance and make adjustments as needed to stay on track towards your financial goals.

Professional Advice: Consider consulting with a Certified Financial Planner (CFP) to create a comprehensive financial plan tailored to your specific needs and goals. A CFP can provide personalized recommendations and strategies to optimize your investments and achieve long-term financial security.

By following these recommendations and staying disciplined in your investment approach, you can work towards achieving your financial goals effectively.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |5092 Answers  |Ask -

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

Asked by Anonymous - May 18, 2024Hindi
Listen
Money
I am 43 years old working in IT company.i have 3 years daughter.currenyI earn 1.2 lakhs per year.Currently i have total invest in mf and stocks approx 70 lakhs.I have 2 lakhs in NPS and 3 lakhs in liquid fund for emergency purpose.i am investing monthly 50 lakha in mf and 20 lakha in stocks.My goal is accumulate 7 cr at the age of 60 years.i am planning to retire at the age of 52 and so something else till 60.can you help where i am in right direction in in my investment or not
Ans: Your commitment to securing your financial future is commendable, especially considering your responsibilities as a parent and your aspirations for early retirement. Let's assess your current investment approach and whether it aligns with your retirement goals.

I admire your dedication to financial planning, balancing your career, family, and long-term aspirations. It's essential to review your investment strategy periodically to ensure it remains aligned with your goals.

Assessing Current Investments
Analyzing Portfolio Composition
Your investment portfolio, comprising mutual funds, stocks, NPS, and liquid funds, reflects a diversified approach. This diversification helps manage risk and maximize returns over the long term.

Evaluating Investment Amounts
Investing 50 lakhs monthly in mutual funds and 20 lakhs in stocks demonstrates a significant commitment to wealth accumulation. However, it's crucial to ensure that these investments are in line with your risk tolerance and retirement objectives.

Aligning Investments with Retirement Goals
Retirement Age and Corpus Target
Planning to retire at 52 and accumulate 7 crores by age 60 is an ambitious yet achievable goal. To reach this target, it's essential to assess the adequacy of your current investment strategy and make any necessary adjustments.

Reviewing Asset Allocation
Considering your age and retirement horizon, reassessing your asset allocation is vital. Gradually shifting towards a more conservative allocation as you approach retirement can help safeguard your wealth against market volatility.

Evaluating Retirement Income Sources
NPS Contribution
With 2 lakhs invested in NPS, you're availing of a tax-efficient retirement savings avenue. Ensure you review your NPS investment periodically to optimize returns and monitor its alignment with your overall retirement strategy.

Liquid Fund for Emergency Fund
Maintaining 3 lakhs in a liquid fund for emergencies is prudent financial planning. This ensures you have readily accessible funds to address unexpected expenses without compromising your long-term investments.

Seeking Professional Guidance
Importance of Financial Planning
As a Certified Financial Planner, I emphasize the significance of regular financial reviews and adjustments. Consulting with a financial advisor can provide valuable insights into optimizing your investment strategy and achieving your retirement goals.

Addressing Risk Factors
Consideration should be given to risk factors such as market volatility, inflation, and longevity risk. A holistic financial plan addresses these risks through appropriate asset allocation, diversification, and contingency planning.

Conclusion
While your current investment strategy demonstrates diligence and foresight, periodic reviews and adjustments are essential to ensure it remains aligned with your retirement objectives. By seeking professional guidance and staying proactive, you're on the right path to achieving financial security and retirement freedom.

Best Regards,

K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |5092 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jun 25, 2024

Money
Sir, My age is 40. I have a family with Mom, Dad, 2 daughters aged 13 years and my wife. I am the only source for income in my family. I am a business person and average monthly profit is approx 2 to 3 lakhs. There are lots of ups and downs in the business and profits are not consistant. So I am doing daily SIP of 5000 in HDFC Top 100 growth. Till date the MF is approx 9 lakhs. I have purchased a flat of Rs 1cr. With an home loan of 40 lakhs. Current EMI is 35000, tenure 20 years started last year. I have taken 2 health insurance policies, one for my mom and dad and another for us. Total yearly premium is 1.25 lakhs. My monthly expenses are approx 1.5 lakhs. I am bit worried about Daughters higher education as they wish to pursue MBBS. Secondly I need to save for my retirement. I wish to retire at 55. Please suggest if I am on right track or I need to change my investment patterns?
Ans: It's great to see your proactive approach towards securing your family's future. Managing finances for a family with varying needs can be challenging, especially when running a business with fluctuating income. Let's evaluate your current financial situation and devise a strategy to achieve your goals, particularly focusing on your daughters' education and your retirement plan.

Current Financial Situation
Monthly Income and Expenses
Average Monthly Profit: Rs 2 to 3 lakhs.
Monthly Expenses: Rs 1.5 lakhs.
EMI: Rs 35,000 for home loan.
Daily SIP: Rs 5,000 in HDFC Top 100 growth.
Health Insurance Premium: Rs 1.25 lakhs per year.
Assets and Liabilities
Mutual Fund Investment: Approx Rs 9 lakhs.
Home Value: Rs 1 crore with Rs 40 lakhs loan.
Health Insurance: Two policies covering the family.
Financial Goals
Daughters' Higher Education: Aim for MBBS, requiring substantial funds.
Retirement: Wish to retire at age 55.
Evaluating Current Investment Patterns
Daily SIP in HDFC Top 100 Growth
Benefits: Regular investment, rupee cost averaging, potential for high returns.
Concerns: Single fund exposure increases risk, need for diversification.
Home Loan and EMI
Home Loan: Rs 40 lakhs with a Rs 35,000 monthly EMI over 20 years.
Interest Burden: Long tenure increases interest cost, affecting cash flow.
Diversification: Mitigating Risks and Enhancing Returns
Mutual Funds: Broadening Horizons
Equity Funds: Diversify beyond HDFC Top 100 to include mid-cap and small-cap funds for growth.
Debt Funds: Include for stability and consistent returns, reducing overall risk.
Hybrid Funds: Mix of equity and debt for balanced growth and stability.
Systematic Investment Plan (SIP) Strategy
Monthly SIP: Instead of daily SIPs, consider monthly SIPs in diversified funds.
Allocation: Spread Rs 1.5 lakhs monthly investment across multiple funds.
Review and Adjust: Regularly review fund performance and adjust as needed.
Education Planning: Securing Your Daughters' Future
Estimating Costs for MBBS
Current Costs: Private medical colleges can cost Rs 50 lakhs to Rs 1 crore.
Inflation Adjustment: Factor in education inflation, typically 8-10% annually.
Education Fund: Building a Corpus
Dedicated SIPs: Start dedicated SIPs for education planning, considering time horizon and risk appetite.
Balanced Allocation: Mix of equity and debt to ensure growth and stability.
Education Loans: An Alternative
Low-Interest Education Loans: Consider for bridging gaps in funding.
Tax Benefits: Interest on education loans is tax-deductible.
Retirement Planning: Ensuring a Comfortable Future
Retirement Corpus: Estimation
Current Lifestyle: Rs 1.5 lakhs monthly expenses, adjusting for inflation.
Corpus Required: Calculate based on desired retirement age, life expectancy, and inflation.
Building the Corpus: Strategic Investments
Equity Exposure: Higher equity exposure for growth in the early years.
Gradual Shift: Move to debt funds as retirement approaches to secure capital.
Regular Review: Adjust portfolio to stay aligned with goals.
Pension Plans: A Steady Income Stream
Pension Funds: Invest in pension funds for regular income post-retirement.
Annuities: Consider annuities for guaranteed income, despite not recommending them as a primary option.
Managing Health Insurance: Ensuring Comprehensive Coverage
Adequate Sum Insured: Ensure health insurance covers all potential medical costs.
Annual Review: Review and adjust coverage based on family health needs and inflation.
Emergency Fund: A Safety Net
Liquid Assets: Maintain an emergency fund covering 6-12 months of expenses.
Investment Vehicles: Keep in high-liquidity instruments like savings accounts or liquid mutual funds.
Final Insights
Regular Monitoring and Adjustments
Review Periodically: Regularly review and adjust your financial plan.
Adapt to Changes: Stay flexible to adapt to market changes and personal circumstances.
Professional Guidance
Certified Financial Planner (CFP): Consider consulting a CFP for personalized advice.
Continuous Learning: Stay informed about financial products and market trends.
Your proactive approach is commendable, and with a few strategic adjustments, you can confidently secure your family's future and achieve your financial goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |5092 Answers  |Ask -

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

Asked by Anonymous - Jun 23, 2024Hindi
Money
Im 33 yers old earning 1.9L per month I have 5L in MF 3.5L in PPF 2L in NPS n 4L in stock market making a sip of 20k in MF ,PPF10k, NPS 5k ,gold 12k every month and having a home loan of 60L paying EMI currently 60K. Please help me are my investment planning is good where I should investment my goal to achieve good corpus for my daughter education and marriage now she is 5 months old.
Ans: First, congratulations on being proactive about your financial planning at a young age. At 33, you have a stable income of Rs. 1.9 lakhs per month and a diversified portfolio. Your investments include Rs. 5 lakhs in mutual funds, Rs. 3.5 lakhs in PPF, Rs. 2 lakhs in NPS, and Rs. 4 lakhs in the stock market. You are also making a SIP of Rs. 20,000 in mutual funds, Rs. 10,000 in PPF, Rs. 5,000 in NPS, and Rs. 12,000 in gold every month. Additionally, you have a home loan of Rs. 60 lakhs with an EMI of Rs. 60,000.

Evaluating Your Investment Strategy
Your investment strategy shows a balanced approach with exposure to various asset classes. However, let's analyze and optimize your investments to ensure you achieve your goals for your daughter's education and marriage.

Diversifying Your Portfolio
Mutual Funds
Mutual funds are a great way to grow your wealth. You have Rs. 5 lakhs invested in mutual funds and are contributing Rs. 20,000 monthly through SIPs. Ensure you are investing in a mix of equity and debt funds to balance risk and returns. Equity funds can provide high growth over the long term, while debt funds offer stability.

Public Provident Fund (PPF)
PPF is a safe investment with tax benefits and guaranteed returns. Your Rs. 3.5 lakhs investment in PPF is good for long-term goals due to its 15-year lock-in period. Your monthly contribution of Rs. 10,000 is also beneficial.

National Pension System (NPS)
NPS is a good option for retirement planning with tax benefits. Your Rs. 2 lakhs investment in NPS and Rs. 5,000 monthly contribution are helping you build a retirement corpus.

Stock Market
Direct stock investments can provide high returns but come with higher risk. Your Rs. 4 lakhs investment in the stock market adds an aggressive growth component to your portfolio. Regularly review and manage your stock investments to mitigate risks.

Gold
Gold is a good hedge against inflation and market volatility. Your monthly investment of Rs. 12,000 in gold is a prudent strategy for diversification.

Managing Your Home Loan
Your Rs. 60 lakhs home loan with an EMI of Rs. 60,000 is a significant commitment. Ensure you maintain an emergency fund to cover at least 6-12 months of EMIs to safeguard against financial uncertainties.

Optimizing Your Investments for Your Goals
Goal 1: Daughter’s Education
Assuming your daughter will need funds for higher education in 18 years, you should focus on long-term growth investments.

Increase SIP in Equity Mutual Funds: Equity mutual funds can offer high returns over the long term. Consider increasing your SIP contributions in equity funds to build a substantial corpus for her education.

Child Education Plan: Consider investing in child-specific mutual fund schemes designed to meet education expenses. These funds often come with a lock-in period, ensuring the money is saved for the intended purpose.

Goal 2: Daughter’s Marriage
Assuming your daughter’s marriage in 25-30 years, you need to plan for a significant corpus.

Balanced Mutual Funds: Invest in balanced or hybrid mutual funds which provide a mix of equity and debt exposure. They offer growth with stability and are suitable for long-term goals.

Systematic Investment Plan (SIP): Continue with your SIPs in mutual funds and consider increasing the amount gradually as your income grows. This disciplined approach will help in accumulating the required funds.

Advantages of Mutual Funds
Professional Management

Mutual funds are managed by professional fund managers who have the expertise to make investment decisions.

Diversification

Mutual funds invest in a diverse range of securities, which helps spread risk and reduce volatility.

Liquidity

Mutual funds offer high liquidity, allowing you to redeem units as per your financial needs.

Tax Efficiency

Certain mutual funds provide tax benefits under Section 80C, which can help in tax planning.

Power of Compounding

The returns from mutual funds, when reinvested, can grow exponentially over time, helping in wealth accumulation.

Disadvantages of Real Estate as an Investment
Illiquidity

Real estate investments are not easily converted to cash, making them less liquid than other investments.

Entry and Exit Costs

Buying and selling real estate involves significant costs, including stamp duty, registration fees, and brokerage.

No Partial Withdrawals

Unlike mutual funds, you cannot partially withdraw from a real estate investment. It is an all-or-nothing situation.

White Transactions

Real estate transactions often involve a mix of white and black money, complicating the process and reducing transparency.

Risk Management
Diversification

Diversify your investments across various asset classes to reduce risk. Avoid concentrating too much in one area.

Regular Review

Periodically review your portfolio to ensure it aligns with your goals. Adjust your investments based on performance and market conditions.

Emergency Fund

Maintain an emergency fund to cover at least 6-12 months of expenses. This fund should be easily accessible and invested in safe, liquid instruments.

Insurance

Ensure you have adequate life and health insurance to protect your family against unforeseen events.

Power of Compounding
The power of compounding is a key factor in growing your wealth. By reinvesting the returns from your investments, you earn returns on both the initial principal and the accumulated returns. This exponential growth can significantly enhance your corpus over time.

Seeking Professional Guidance
While you have a solid understanding of investments, consulting a Certified Financial Planner (CFP) can provide you with personalized advice and strategies. A CFP can help you navigate complex financial decisions and ensure your investments are aligned with your goals.

Final Insights
You have made commendable progress in your financial journey at 33 years old. Your diversified investments and disciplined approach are commendable. Here’s a summary of the key steps to enhance your financial plan:

Increase SIPs in Equity Mutual Funds: Boost your contributions to equity mutual funds to build a substantial corpus for your daughter's education and marriage.
Maintain Diversification: Continue diversifying across mutual funds, PPF, NPS, gold, and stocks to balance risk and returns.
Review and Adjust: Regularly review your portfolio and make adjustments as needed to stay on track with your goals.
Consult a CFP: Seek guidance from a Certified Financial Planner to refine your investment strategy and achieve your financial objectives.
Your commitment to financial planning and investing for your daughter's future is admirable. With a well-structured plan and disciplined execution, you can achieve your goals and secure a bright future for your family.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Latest Questions
Nayagam P

Nayagam P P  |2279 Answers  |Ask -

Career Counsellor - Answered on Jul 22, 2024

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.

Close  

You haven't logged in yet. To ask a question, Please Log in below
Login

A verification OTP will be sent to this
Mobile Number / Email

Enter OTP
A 6 digit code has been sent to

Resend OTP in120seconds

Dear User, You have not registered yet. Please register by filling the fields below to get expert answers from our Gurus
Sign up

By signing up, you agree to our
Terms & Conditions and Privacy Policy

Already have an account?

Enter OTP
A 6 digit code has been sent to Mobile

Resend OTP in120seconds

x