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Ramalingam

Ramalingam Kalirajan  |6986 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 17, 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
Anil Question by Anil on May 08, 2024Hindi
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Hi I am currently 50 years old... Could u guide me as to what amount of monthly SIP should I put and in to which funds so as to generate a monthly retirement payout of 2 lac every month at the age of 60 years

Ans: Planning for Retirement Income
Understanding Your Goal
Planning for a monthly retirement payout of 2 lakhs at the age of 60 is a commendable goal and requires careful financial planning.
Assessing Your Current Situation
As you're currently 50 years old, it's essential to evaluate your existing assets, liabilities, and investment portfolio to determine your financial standing.
Calculating Required Corpus
Estimating Retirement Corpus
To generate a monthly payout of 2 lakhs, you'll need to calculate the required retirement corpus based on your expected retirement age, life expectancy, inflation, and expected rate of return on investments.
Working with a Financial Planner
Consulting with a Certified Financial Planner (CFP) can help you determine the exact amount of monthly SIP required to achieve your retirement income goal.
Designing Your Investment Portfolio
SIP Amount and Fund Selection
Your monthly SIP amount will depend on factors such as your current savings, expected rate of return, and investment horizon.
A CFP can recommend a suitable asset allocation strategy and select appropriate mutual funds based on your risk tolerance, financial goals, and time horizon.
Diversification for Stability
Diversifying your portfolio across different asset classes, such as equities, debt, and possibly real estate or alternative investments, can provide stability and enhance returns over the long term.
Adjusting Your Financial Plan
Flexibility and Adaptability
It's crucial to periodically review and adjust your financial plan based on changing circumstances, market conditions, and personal goals.
A CFP can help you navigate through life transitions and unexpected events while staying on track towards your retirement objectives.
Conclusion
Planning for retirement requires careful consideration of various factors, including your age, financial situation, risk tolerance, and retirement income goals. By working with a CFP, you can develop a personalized financial plan tailored to your specific needs and aspirations, ensuring a secure and comfortable retirement lifestyle.

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  |6986 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 08, 2024

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Sir,My age is 43 year which sip or fund will be better to get pension of Rs 25000 per month at the age of 58 year and how much should I have to invest monthly.
Ans: To achieve a pension of Rs 25,000 per month at the age of 58, you need to start investing in retirement-focused mutual funds or pension plans. Here's a suggested approach:
Equity Mutual Funds for Growth: Since you have a long investment horizon until retirement, consider investing a significant portion of your savings in equity mutual funds. These funds have the potential to offer higher returns over the long term, helping you build a substantial corpus.

Diversification: Opt for a diversified portfolio of equity funds across large-cap, mid-cap, and small-cap segments to spread out risk. Additionally, allocate a portion of your investments to debt funds to provide stability and reduce overall portfolio volatility.

Systematic Investment Plan (SIP): Start a SIP in selected equity mutual funds to regularly invest a fixed amount every month. SIPs help in rupee cost averaging and can smoothen out the impact of market volatility over time.

Asset Allocation: As you approach retirement, gradually shift your asset allocation from equity to debt funds to reduce risk and preserve capital. This can be done gradually over several years to minimize the impact on your portfolio.

Systematic Withdrawal Plan (SWP): Once you retire, consider setting up a SWP from your mutual fund investments to generate a regular income stream. Determine the amount you need for monthly expenses and set up SWPs accordingly from debt or balanced funds.

Review and Adjust: Regularly review your investment portfolio and withdrawal strategy to ensure it aligns with your financial goals, risk tolerance, and changing life circumstances. Adjust your asset allocation and SWP amount as needed based on market conditions and your retirement income needs.

Consult a Financial Advisor: Consider consulting with a financial advisor who can help you design a customized investment plan tailored to your specific requirements and risk profile. They can also provide guidance on tax-efficient withdrawal strategies during retirement.

By following this approach, you can benefit from the growth potential of equity investments during your working years while ensuring a steady income stream through SWP during retirement, helping you beat inflation and meet your financial goals.

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Ramalingam

Ramalingam Kalirajan  |6986 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Sep 26, 2024

Asked by Anonymous - Sep 26, 2024Hindi
Money
I am 50 , to get my retirement amount 1cr how much amount I should invest in mutual funds ie sip ,pls guide me .
Ans: At 50, planning for your retirement is a great step. Your goal is to accumulate Rs 1 crore by the time you retire. To achieve this through a Systematic Investment Plan (SIP) in mutual funds, it’s important to assess various factors like time horizon, risk appetite, and expected returns. Let's break it down step by step to give you a clearer picture.

Factors Affecting Your SIP Investment
1. Time Horizon
Since you are 50 years old, the time left for retirement depends on when you plan to retire. Typically, retirement age is 60, so you may have 10 years. The shorter the time horizon, the larger your monthly SIP investment needs to be. If you have a longer time horizon, you can contribute a smaller amount monthly.

2. Expected Returns from Mutual Funds
In the Indian context, mutual funds—particularly equity mutual funds—can give returns ranging between 10% to 12% annually over the long term. For a 10-year horizon, investing in actively managed equity mutual funds can help you maximize growth. The reason is that equity has historically outperformed other asset classes over long periods. Debt mutual funds are safer but tend to offer lower returns, typically around 6% to 7%.

Choosing actively managed funds over passive index funds can help you get better returns as these funds are overseen by expert fund managers. While index funds follow the market, actively managed funds adjust for volatility and aim for higher returns.

3. Risk Tolerance
Since you are aiming to invest for 10 years or more, you have a moderate-to-long time horizon, which allows you to take on moderate risk. Equity-oriented mutual funds tend to be volatile in the short term but can deliver good returns in the long run. By investing in a balanced mix of equity and hybrid funds, you can ensure both growth and capital preservation.

SIP Calculation for Rs 1 Crore Corpus
To accumulate Rs 1 crore, the exact SIP amount depends on the returns your mutual fund investments generate. Here’s how the investment process works:

If the mutual funds generate 10% returns per annum, you will need to invest a higher amount compared to a 12% return scenario.

You can aim for equity mutual funds to help you reach the Rs 1 crore target within 10 years. Over time, you can shift part of your corpus to debt mutual funds to reduce the risk as you approach retirement.

However, the precise monthly SIP amount will depend on how much you can invest, your risk appetite, and your retirement timeframe. It’s recommended to start higher and adjust your SIP later depending on market performance.

SIP Strategies
1. Equity Mutual Funds
Since your goal is long-term, focusing on equity mutual funds is a smart option. These funds invest in stocks, which have historically provided inflation-beating returns over the long term. A mix of large-cap and mid-cap funds will give you stability and growth potential.

Actively managed equity mutual funds can help you get higher returns. These funds are managed by professionals who constantly adjust the portfolio based on market conditions, unlike index funds which follow the market blindly.

2. Hybrid Mutual Funds
If you want to balance between risk and return, consider hybrid mutual funds. These funds invest in both equity and debt, providing you with a safer option than pure equity funds but better returns than debt funds alone. A Certified Financial Planner (CFP) can help you choose the right hybrid funds for your retirement needs.

3. Debt Mutual Funds
Debt mutual funds can be included to offer a safety net as you near retirement. These funds are low-risk and offer steady, though lower, returns. As you approach your retirement, you can shift a portion of your investments to debt funds to protect the corpus from market volatility.

Why Not Index Funds?
You might come across index funds as a simpler alternative. While index funds have lower fees, they merely replicate the performance of an index like the Nifty 50. The downside is that they don't outperform the market. In contrast, actively managed mutual funds can offer better returns because skilled fund managers actively choose high-performing stocks and adjust the portfolio to respond to market conditions.

Actively managed funds also allow you to reduce risk over time, as the manager may move assets to safer investments if the market becomes volatile. This flexibility makes them a better choice for someone nearing retirement.

Regular Fund Investments vs Direct Funds
When choosing mutual funds, you might come across direct plans which charge lower fees compared to regular plans. However, direct plans don’t provide the advisory services or professional guidance that come with regular plans. Working with a CFP and investing through mutual fund distributors (MFDs) ensures you get expert advice and a well-constructed portfolio suited to your goals.

Protecting Your Retirement Corpus
As you approach retirement, it’s crucial to protect your investment from risks like market crashes. One strategy is to gradually reduce your exposure to equity funds and move to safer debt funds. A Certified Financial Planner can help you determine the right time to shift and how much to shift, ensuring your Rs 1 crore target remains on track.

Final Insights
To reach Rs 1 crore by the time you retire, investing through SIPs in a combination of equity, hybrid, and debt mutual funds is a balanced and effective approach. You will need to calculate the exact SIP amount based on the number of years to retirement, expected returns, and risk tolerance. Starting early and being consistent with your SIP contributions is key.

Start with Equity Funds: These will help you achieve higher returns in the earlier years.

Gradually Shift to Hybrid and Debt Funds: As you approach retirement, reduce your equity exposure and move to safer assets.

Seek Professional Guidance: A CFP can help you select the right funds and adjust your strategy as needed.

By following this strategy, you can comfortably achieve your Rs 1 crore retirement corpus and enjoy a financially secure retirement.

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

..Read more

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Anu Krishna  |1281 Answers  |Ask -

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

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Anu Krishna  |1281 Answers  |Ask -

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Help me!!! 1.I'm starting new "work" on my own(challenging for me) but my mind says quit it, be quite & do nothing. I myself don't know that wether the result of work will be +ive or uncompleted like alws. 2. My mind has become like order seeker type, when someone orders me, I do those things with dedicated(but sad from inside) manner. But when myself will try something different(which i fear, but necessary) then. "I QUITS IT" & sometimes I don't even start. 3. I'm like stuck no clue what/whom I want to do in life, I'm in cllg(1 yr) doing (CSE) ,. 4. I want to do/try (sports,talking girls,study,stocks,coding..) many things, but myself, my thoughts(overthinker), R like just be in the place where u are[confused,po*n,think about past/future(being billio..re,olympics..), girl (that u liked & never talked), abusive/beating self,.. sometimes feels like end life, but don't hv courage for that also.. 5. I tried self help books, spirituality, god, self affirmation, writing... & thay affected me(sometimes) but for only some time, then again that devil me comes up &these things never get completed. As no one in my family knows about all these, so that's Y ,I hv to fight/loose/try again, the battles with myself.
Ans: Dear Harsh,
If in the past you have had the urge to QUIT, how is this time going to be different? This is not to discourage you from taking up 'new work' but pointing out that there is some amount of work that you need to put to clear the mind out of blockages.
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Also, focus on one thing at a time; study and go deep into it...what's this thing with work? I don't understand. When the mind is unsettled, take one thing/activity, pursue it and finish it. It could simply be studying for Year 1 of your college...just only do that...once your mind is trained in completing an activity, you can add another one the next year along with studying and then pursue both...it could be some sport and studying...then the next year, you could add a third activity. This is called 'training the mind in discipline'. Discipline will make sure that you start and finish things...So, go slow and do one thing at a time.

All the best!
Anu Krishna
Mind Coach|NLP Trainer|Author
Drop in: www.unfear.io
Reach me: Facebook: anukrish07/ AND LinkedIn: anukrishna-joyofserving/

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

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