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Vivek

Vivek Lala  |301 Answers  |Ask -

Tax, MF Expert - Answered on Aug 19, 2023

Vivek Lala has been working as a tax planner since 2018. His expertise lies in making personalised tax budgets and tax forecasts for individuals. As a tax advisor, he takes pride in simplifying tax complications for his clients using simple, easy-to-understand language.
Lala cleared his chartered accountancy exam in 2018 and completed his articleship with Chaturvedi and Shah. ... more
PARAMVIR Question by PARAMVIR on Aug 11, 2023Hindi
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Dear Sir, how to exit mutual fund investment

Ans: Hello, you can ask your advisor to sell if for you
If the investment is direct , you can go to the AMC's website create an account and then sell it from there
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  |7595 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 04, 2024

Asked by Anonymous - Jan 25, 2024Hindi
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When to exit a mutual fund?
Ans: Deciding when to exit a mutual fund depends on several factors, including your investment goals, the fund's performance, changes in your financial situation, and market conditions. Here are some situations when it might be appropriate to consider exiting a mutual fund:

Achievement of Financial Goals: If you've achieved your investment objectives or reached a milestone, such as funding a specific goal like buying a house or funding education, it may be a good time to exit the fund.

Poor Performance: If the mutual fund consistently underperforms its benchmark or peers over an extended period, it could be a sign to reconsider your investment and exit the fund.

Fund Manager Changes: A change in the fund manager or significant changes to the fund's investment strategy or objectives may warrant a review of your investment. If you're uncomfortable with the new management or strategy, exiting the fund might be appropriate.

Rebalancing: Periodically rebalancing your investment portfolio to maintain your desired asset allocation is essential. If the mutual fund's performance has skewed your asset allocation, consider selling some holdings to rebalance your portfolio.

Life Changes: Changes in your life circumstances, such as job changes, marriage, divorce, or retirement, may necessitate a review of your investments. You may need to adjust your investment strategy to align with your new goals and risk tolerance.

Fund Expenses: If the mutual fund's expenses increase significantly without a corresponding improvement in performance, it may erode your returns over time. In such cases, consider exiting the fund in favor of lower-cost alternatives.

Market Conditions: During extreme market volatility or significant changes in economic conditions, it's essential to reassess your investments. If the market outlook or risk factors have changed substantially, it may be prudent to exit or reallocate your investments accordingly.

Remember, it's essential to evaluate your investment decisions carefully and consider consulting with a financial advisor before making any significant changes to your portfolio. Exiting a mutual fund should align with your long-term financial goals and be part of a well-thought-out investment strategy.

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Ramalingam

Ramalingam Kalirajan  |7595 Answers  |Ask -

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

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Thanks sir.Another question If I need to stop any fund should I do this after 1 year to mitigate exit load and short term tax this to be done every time if I invested in certain fund and finding it is not beating it's benchmark for past 6 mins.
Ans: Understanding Fund Performance and Investment Adjustments
Making informed decisions about stopping or switching funds is crucial. If a fund isn't meeting your expectations, it’s important to understand the implications of exit loads and short-term taxes.

Evaluating Fund Performance
Regularly reviewing your fund’s performance is essential. If your investment isn't beating its benchmark for the past six months, it might be concerning. However, short-term underperformance doesn’t always mean the fund is bad.

Mitigating Exit Load and Short-Term Tax
Most funds charge an exit load if you withdraw your investment within a certain period, typically one year. Additionally, short-term capital gains tax applies if you sell your investment within three years for debt funds or one year for equity funds.

Strategy for Exiting Underperforming Funds
If you find a fund underperforming, consider waiting until you’ve held the fund for over a year. This approach helps avoid exit load and reduces tax liability.

The Role of a Certified Financial Planner (CFP)
Instead of managing investments yourself, consult a CFP. They can guide you in selecting the right funds and adjusting your portfolio as needed.

Disadvantages of DIY Investing
DIY investing can be challenging without professional guidance. Selecting funds, timing the market, and managing risks require expertise. A CFP can help you avoid common pitfalls.

Benefits of Professional Management
Investing through a CFP or Mutual Fund Distributor (MFD) ensures you get expert advice. They monitor fund performance, make necessary adjustments, and ensure your portfolio aligns with your goals.

Actively Managed Funds and Performance
Actively managed funds can potentially outperform benchmarks. Professional fund managers make strategic decisions to adapt to market conditions. They aim to achieve better returns compared to passive index funds.

Diversification and Risk Management
Diversification reduces risk by spreading investments across various asset classes. A well-diversified portfolio balances potential returns with manageable risk. Actively managed funds often include a mix of assets, enhancing diversification.

Emotional Discipline and Long-Term Perspective
Investing requires patience and emotional discipline. Avoid making impulsive decisions based on short-term performance. Maintain a long-term perspective and trust your financial plan.

Regular Monitoring and Adjustments
Regularly review your investment portfolio with your CFP. Market conditions and personal circumstances change over time. Your CFP can help adjust your strategy to stay aligned with your financial goals.

Financial Education and Empowerment
Educate yourself about investing principles and strategies. Financial literacy empowers you to make informed decisions. Stay confident in your investment choices with a strong knowledge base.

Conclusion
If you need to stop an underperforming fund, consider doing so after one year to avoid exit load and short-term tax. Consulting a CFP can help you choose the right funds and avoid the pitfalls of DIY investing. Stay disciplined, maintain a long-term perspective, and regularly review your investments for optimal performance.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |7595 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 16, 2024

Asked by Anonymous - Jun 29, 2024Hindi
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Sir, I am holding nearly 25 lakhs for an investment of 10lakhs in different mutual funds. I want to exit from some of the funds like UTI NIFTY 500 VALUE 50 INDEX FUND Regular The return on this fund is nearly hundred percent. Iam 78 years old. Wherever I have more than fifty percent return I would like to invest MIP OF POST OFFICE OR KISAAN VIKASH PATRAor SENIOR CITIZENS SCHEME.Only the profit part. Principal l will continue. Should I wait till the budget of act.Should linvst that amount in top 50 NSE.stocs. kindly treat the matter as urgent.
Ans: It's wise to exit funds like UTI NIFTY 500 VALUE 50 INDEX FUND with 100% returns. Shifting profits to safer options is a good move at your age. Let's evaluate suitable investment options.

Considering Safe Investment Options
Investing in MIP of Post Office, Kisan Vikas Patra, or Senior Citizens Scheme ensures safety. These options offer steady returns and low risk. They are ideal for preserving capital and generating regular income.

Importance of Certified Financial Planner
Consulting a CFP can provide tailored advice. They help assess your risk tolerance and financial goals. This ensures your investments align with your needs.

Evaluating Top 50 NSE Stocks
Investing in top 50 NSE stocks can offer growth potential. However, it carries higher risk compared to fixed income schemes. Given your age, balancing risk and safety is crucial.

Timing and Budget Considerations
Waiting until the budget can offer insights into tax benefits or new schemes. However, market conditions can change. Consult a CFP to decide the best time to invest based on your financial goals.

Benefits of Actively Managed Funds
Instead of index funds, consider actively managed funds. They offer professional management and can adapt to market changes. This can lead to better returns and risk management.

Evaluating All Financial Aspects
Review your entire financial situation before deciding. Consider your expenses, other investments, and risk tolerance. Diversifying your portfolio ensures stability and growth.

Final Insights
Exiting high-return mutual funds and investing in safer options is prudent. Consider MIP, Kisan Vikas Patra, or Senior Citizens Scheme for safety. Consult a CFP for personalized advice and balanced investment strategies.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Latest Questions
Ramalingam

Ramalingam Kalirajan  |7595 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jan 21, 2025

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I am 49 and plan to retire in 2 years time.. I currently have a MF corpus of about 1.8 Cr, a PF of about 1 Cr and properties worth 2 Cr. I have been investing in MF's since 2014 through SIP's and currently have 70K monthly SIP. Please advise if I would be comfortable in 2 years, my estimated monthly expense post retirement would be approx 2 Lakhs per month
Ans: Your current corpus of Rs. 1.8 crore in mutual funds and Rs. 1 crore in PF is significant. The additional Rs. 2 crore in properties adds to your wealth but doesn’t provide immediate liquidity. Let us evaluate if your corpus will sustain your post-retirement expense of Rs. 2 lakh per month.

Estimating Post-Retirement Corpus Requirement
You plan to retire in 2 years, at age 51.

Assuming a life expectancy of 85 years, the corpus needs to last for 34 years.

An expense of Rs. 2 lakh per month means Rs. 24 lakh annually.

Adjust this amount for inflation to calculate future needs.

Current Investment Contributions
Your Rs. 70,000 monthly SIP builds your corpus over the next 2 years.

SIPs offer rupee cost averaging, reducing market volatility impact.

Assess the fund performance regularly to maximise growth.

Diversification of Investments
Your corpus is spread across mutual funds, PF, and properties.

PF provides a stable, fixed return but lacks flexibility.

Properties offer wealth accumulation but are less liquid for immediate needs.

Mutual funds remain a primary source of liquidity and growth post-retirement.

Evaluating Monthly Withdrawals Post-Retirement
Withdrawals should balance your monthly expenses and ensure corpus longevity.

Avoid withdrawing large amounts in the early years of retirement.

Consider a mix of equity and debt mutual funds for withdrawal strategies.

Role of Inflation and Healthcare Costs
Factor in inflation’s effect on expenses over 30+ years.

A 6% inflation rate doubles your monthly expense in 12 years.

Allocate for increasing healthcare costs with age.

Importance of Emergency and Medical Coverage
Keep at least 6 months' expenses in a liquid fund for emergencies.

Ensure you have comprehensive health insurance for unexpected medical costs.

Tax Efficiency in Withdrawals
Equity mutual funds' LTCG above Rs. 1.25 lakh is taxed at 12.5%.

Debt fund returns are taxed as per your income tax slab.

Plan withdrawals to minimise tax liability on gains.

Active Funds vs. Direct Funds
Actively managed funds optimise returns by responding to market changes.

Direct funds lack professional support, affecting long-term efficiency.

Work with a Certified Financial Planner to select regular funds.

Disadvantages of Relying on Real Estate
Properties are illiquid and may take time to convert to cash.

Rental income may not cover Rs. 2 lakh monthly expenses reliably.

Maintenance and property taxes further reduce returns.

Recommendations for Portfolio Restructuring
Increase Allocation to Growth Assets

Continue SIPs in equity mutual funds for growth potential.

Review funds for consistent performance and portfolio alignment.

Add Balanced and Debt Funds for Stability

Include balanced advantage and debt funds for steady income.

Debt funds reduce overall portfolio risk.

Plan a Withdrawal Strategy

Use the SWP (Systematic Withdrawal Plan) for predictable income.

Withdraw from equity funds after 3 years for tax efficiency.

Avoid Over-reliance on PF and Real Estate

PF offers safety but limited returns.

Use properties strategically for potential downsizing or sale.

Final Insights
You are on track to retire comfortably, provided you optimise your investments. Plan your withdrawals carefully, factoring in inflation and tax efficiency. Work with a Certified Financial Planner to refine your portfolio and achieve your goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment

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Ramalingam

Ramalingam Kalirajan  |7595 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jan 21, 2025

Asked by Anonymous - Jan 21, 2025Hindi
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I like to know which MF to be selected for investing in a SIP among same types of funds with equal performances and risks but with different NAVs.
Ans: When selecting a mutual fund for SIP among funds with similar types, performances, and risks but different NAVs, consider the following aspects:

1. Net Asset Value (NAV) Does Not Reflect Fund Performance
A lower or higher NAV does not indicate better returns.

NAV reflects the fund's per-unit value and changes daily.

Investment growth depends on percentage returns, not NAV values.

2. Expense Ratio and Fund Costs
A lower expense ratio can improve net returns.

Actively managed funds with skilled fund managers may charge slightly higher fees.

Ensure you evaluate the cost-to-benefit ratio before making a decision.

3. Fund Manager's Track Record
Review the fund manager's expertise and past performances.

A consistent manager with strong market knowledge can add value.

Avoid funds with frequent management changes.

4. Fund House Reputation and AUM
Choose funds from a reputed fund house with a strong track record.

A large Asset Under Management (AUM) ensures better stability and liquidity.

Avoid funds with excessively low AUM, as they may face liquidity issues.

5. Tax Implications of the Fund
Assess how long-term and short-term capital gains will affect returns.

Equity mutual funds have specific tax rates: LTCG above Rs 1.25 lakh is taxed at 12.5%.

Debt funds follow your income tax slab, affecting post-tax returns.

6. Investment Goals and Time Horizon
Align the fund choice with your financial goals.

Longer-term goals may benefit from equity-focused funds.

Short-term goals may require hybrid or debt-focused funds.

7. SIP Benefits in Any NAV
SIPs help average out purchase costs over time, reducing the impact of NAV differences.

Avoid basing decisions solely on NAV, as SIPs work on rupee cost averaging.

8. Focus on Portfolio Composition
Examine the fund's portfolio mix and sector allocation.

Ensure diversification aligns with your risk appetite and goals.

Avoid funds with concentrated exposure to risky sectors.

9. Assess Consistency of Returns
Look at rolling returns and consistency across market cycles.

Funds with stable returns in volatile markets are preferable.

Avoid funds with high volatility in performance.

10. Disadvantages of Index Funds
Index funds passively track benchmarks, lacking flexibility in volatile markets.

Actively managed funds can outperform by leveraging market opportunities.

A Certified Financial Planner can guide you to suitable active funds.

11. Benefits of Regular Funds Over Direct Funds
Regular funds offer ongoing advice and monitoring by a Mutual Fund Distributor (MFD).

Direct funds lack professional support, which is crucial for long-term goals.

Certified Financial Planners provide insights and manage your portfolio efficiently.

Final Insights
Choosing the right mutual fund involves evaluating beyond NAVs. Focus on long-term potential, cost efficiency, and alignment with goals. SIPs, combined with expert advice, will help you achieve financial stability.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment

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Pushpa

Pushpa R  |45 Answers  |Ask -

Yoga, Mindfulness Expert - Answered on Jan 21, 2025

Pushpa

Pushpa R  |45 Answers  |Ask -

Yoga, Mindfulness Expert - Answered on Jan 21, 2025

Pushpa

Pushpa R  |45 Answers  |Ask -

Yoga, Mindfulness Expert - Answered on Jan 21, 2025

Asked by Anonymous - Jan 21, 2025Hindi
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I'm a 40-year-old woman struggling with bloating and poor digestion. Are there specific yoga poses or kriyas that can improve my gut health?
Ans: Bloating and poor digestion are common but can improve with yoga and simple kriyas. Yoga helps by stimulating your digestive organs, improving blood flow, and reducing stress, which often affects gut health.

Here are some yoga poses and kriyas for better digestion:

Wind-Relieving Pose (Pavanamuktasana): Lie on your back, bring your knees to your chest, and gently hug them. This pose helps release gas and soothes your stomach.

Cat-Cow Stretch (Marjaryasana-Bitilasana): On all fours, alternate between arching your back (Cow) and rounding it (Cat). This movement massages the abdominal organs and improves digestion.

Seated Twist (Ardha Matsyendrasana): Sit with one leg crossed over the other, then twist your upper body. Twists stimulate the digestive system and release toxins.

Kapalabhati (Skull Shining Breath): This kriya involves rapid exhalations and helps cleanse your digestive tract. Practice for 2-3 minutes daily, preferably on an empty stomach.

Relaxation: End with 5-10 minutes in Corpse Pose (Savasana) to calm your mind and reduce stress, which often worsens bloating.

For safe and effective practice, consult a yoga coach who can guide you with proper techniques. Personalized guidance will bring better results.

R. Pushpa, M.Sc (Yoga)
Online Yoga & Meditation Coach
Radiant YogaVibes
https://www.instagram.com/pushpa_radiantyogavibes/

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Nitin

Nitin Narkhede  |56 Answers  |Ask -

MF, PF Expert - Answered on Jan 21, 2025

Asked by Anonymous - Dec 01, 2024Hindi
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Money
We two brothers have inherited a property on 200 sq yard by registered will of our father in 2020. The property was purchased by our father in 1970 and redeveloped in 1990 into three story building. Ground floor is with my brother and first floor. Third floor without roof rights was sold by our father at the time of redevelopment . Me and my brother have terrace rights as per registered will of our father ( each has 50% roof/ terrace rights). My brother is US citizen and want to sell his share for four crores. The expected rental income from the ground floor will be Rupees 60 thousand per month. The circle rate of the property is Rupees 7 lakh per yard. My interest in the ground floor of the property is mainly to live peacefully without any interference by unknown new buyer. I am 65 and my question is from financial point should I purchase from my brother by paying Rs. 4 crore or keep the amount in bank as fixed deposit/ RBI bonds at around 8 percent per year. Second question is if he sell it to other buyer how he will sell terrace as the terrace is undivided and we both have inherited it by registered will. Thirdly there are many builders who want to redevelop the property into four floor with basement and stilt parking. What will be the right option . I have only son .
Ans: Dear Friend,
If you’re considering whether to purchase your brother’s share of the inherited property for ?4 crore, weigh peace of mind against financial returns. Buying his share gives you full control, eliminates potential disputes with a third-party buyer, and ensures no interference in your peaceful living. However, the rental yield of ?60,000/month (~1.8% annual return) is significantly lower than the ~8% return you could get by investing ?4 crore in fixed deposits or bonds, which would generate ~?2.67 lakh/month.

Regarding the terrace, your brother cannot sell his 50% share independently since it is undivided and jointly inherited. Any sale requires your consent, limiting his ability to transfer full terrace rights to a new buyer.

Redevelopment of the property is an excellent option, offering increased value and rental income. Builders are likely to provide additional floors or cash components in exchange for development rights, enhancing long-term financial benefits and ensuring modern amenities.

If your priorities are peace of mind and control over the property, purchase your brother’s share. Otherwise, invest in safer financial instruments and consider redevelopment to maximise the property’s potential. Consult a lawyer and financial advisor to ensure the best decision. Your Financial adviser can deeply evaluate all your assets and liabilities and provide a solution which will give you more leverage.
Regards, Nitin Narkhede -Founder Prosperity Lifestyle Hub,
Free webinar https://bit.ly/PLH-Webinar

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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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