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Ramalingam

Ramalingam Kalirajan  |7683 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 25, 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
girish Question by girish on Apr 25, 2024Hindi
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Hi, Every month i invest Rs.6000 (i.e 1000 in each SIP as below 1) Aditya Birla Sun Life Small Cap Fund - GROWTH, 2) Axis Flexi Cap Fund - Regular Plan - Growth ,3)Canara Robeco Emerging Equities - Regular Plan - GROWTH ,4)HDFC Large and Mid Cap Fund - Regular Growth Plan ,5)ICICI Prudential Flexicap Fund - Growth ,6)Nippon India ELSS Tax Saver Fund-Growth Option and RS.50,000/- in Liquiloans is it good ? should i continue with the same stock..

Ans: It's great to see your disciplined approach towards investing through SIPs and also diversifying across various mutual fund categories. Let's review your current investments and provide some insights:

Diversification: You've done a good job diversifying across different mutual fund categories like Small Cap, Flexi Cap, Emerging Equities, Large and Mid Cap, Flexicap, and ELSS. This approach can help spread the risk and potentially enhance returns.
Performance Review: It's essential to periodically review the performance of your funds. While past performance is not indicative of future results, checking the fund's performance relative to its benchmark and peers can give you insights into its consistency and potential.
Liquiloans: Investing in platforms like Liquiloans involves lending money to borrowers, which carries a higher level of risk compared to traditional investment avenues. The risk associated with such platforms is higher due to factors like borrower defaults and platform-specific risks. Given the higher risk involved, it's crucial to evaluate whether this aligns with your risk tolerance and overall investment strategy. Considering your other diversified mutual fund investments, you might want to reconsider allocating a significant portion to such platforms and explore more stable and regulated investment options to safeguard your investment capital.
Professional Advice: Consider consulting a Certified Financial Planner to get a comprehensive review of your portfolio. They can provide personalized advice tailored to your financial goals, risk tolerance, and investment horizon. They can also guide you on whether to continue with your current SIPs or make any necessary adjustments.
Stay Invested: Investing is a long-term journey, and it's essential to stay invested and not get swayed by short-term market fluctuations.
Remember, while your current investment strategy seems well-diversified, it's crucial to review and adjust periodically to align with your financial goals and market conditions. Best wishes on your investment journey!
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  |7683 Answers  |Ask -

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

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Hello Sir I am 45 year old and I have been investing Rs.1000/- as SIP in following stock - 1 Aditya Birla Sun Life Small Cap Fund 2 Axis Flexi Cap Fund - Regular Plan – Growth 3 Canara Robeco Emerging Equities - Regular Plan – GROWTH 4 HDFC Large and Mid Cap Fund - Regular Growth Plan 5 ICICI Prudential Flexicap Fund – Growth 6 Nippon India ELSS Tax Saver Fund-Growth And I also have invested Rs.50,000/- in liquiloans I just want to know is my investment is good or do I need to make more investment or any changes in my invest ment Sir pls do reply Thanks & Regard
Ans: Congratulations on taking proactive steps towards securing your financial future at the age of 45! Your commitment to investing is admirable and sets a solid foundation for wealth accumulation.

Understanding Your Portfolio:

You've chosen a diversified portfolio with investments across various mutual funds, including small-cap, flexi-cap, large and mid-cap, and ELSS tax saver funds. Additionally, your investment in Liquiloans adds an alternative asset class to your portfolio.

Assessing the Investment Mix:

Your portfolio reflects a well-rounded approach, with exposure to different market segments and investment styles. Small-cap funds offer growth potential, while flexi-cap and large and mid-cap funds provide stability and diversification.

Evaluating Investment Choices:

Each fund you've selected has its unique investment objective and risk profile. Aditya Birla Sun Life Small Cap Fund and Canara Robeco Emerging Equities focus on small and emerging companies, potentially offering high returns but also higher volatility.

Axis Flexi Cap Fund, HDFC Large and Mid Cap Fund, and ICICI Prudential Flexicap Fund offer flexibility in asset allocation, blending exposure across market caps. Nippon India ELSS Tax Saver Fund provides tax benefits along with long-term wealth accumulation.

Analyzing Additional Investment:

Your decision to invest in Liquiloans introduces an element of diversification beyond traditional mutual funds. However, peer-to-peer lending platforms like Liquiloans carry inherent risks, including credit and default risk, which should be carefully considered.

Recommendation for Consideration:

Given your age and investment horizon, your portfolio seems appropriately diversified. However, it's crucial to regularly review and rebalance your portfolio to ensure it aligns with your financial goals and risk tolerance.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

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Ramalingam Kalirajan  |7683 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jan 28, 2025

Asked by Anonymous - Jan 28, 2025Hindi
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I am 47 years with a corpus of 2 cr in equity and stock combined together , MF portfolio combined of equity and debt is approx 1.25 Cr and debt will be 25 lacs my wife is in a govt lecturer in school I am in a Pharma company got a house in tier B got rental income of RS 1.5 lacs My daughter is in tenth and son in 7th got no loan or EMI can I get retired what should be the asset allocation after retirement
Ans: You have a well-diversified corpus of Rs. 3.5 crore.

Rs. 2 crore in equity and stocks is ideal for wealth creation.

Rs. 1.25 crore in mutual funds offers balanced exposure to equity and debt.

Rs. 25 lakh in debt ensures liquidity and stability for emergencies.

A government-employed spouse and rental income add financial security.

No loans or EMIs further strengthen your financial independence.

Can You Retire Now?
Your rental income of Rs. 1.5 lakh per month is a strong passive income.

Your wife’s stable government job ensures additional financial support.

Corpus and income sources are sufficient for retirement if managed well.

However, children’s education expenses and inflation must be planned carefully.

Steps to Consider Before Retirement
Plan for Children’s Education
Your daughter is in 10th and son in 7th, requiring education funding soon.

Set aside a dedicated corpus for higher education.

Invest in debt funds or balanced funds for medium-term needs.

Emergency Fund and Insurance Coverage
Maintain an emergency fund equivalent to 12 months’ expenses.

Ensure you have adequate health insurance for the entire family.

Consider critical illness insurance for additional coverage.

Inflation Protection
Inflation will erode the value of your fixed income over time.

Allocate a portion of your portfolio to equity for inflation-beating returns.

Review your expenses regularly and adjust investments accordingly.

Ideal Asset Allocation Post-Retirement
Equity Allocation
Keep 40%-50% of your portfolio in equity for long-term growth.

Focus on large-cap or diversified funds to reduce risk.

Debt Allocation
Allocate 40%-45% to debt for stability and regular income.

Use a mix of debt mutual funds, FDs, and senior citizen saving schemes.

Liquid Assets
Keep 5%-10% of your portfolio in liquid funds for emergencies.

Liquidity ensures immediate availability of funds without breaking investments.

Tax Efficiency in Retirement
Equity mutual funds provide tax-efficient long-term returns.

LTCG on equity above Rs. 1.25 lakh is taxed at 12.5%.

Debt mutual funds are taxed as per your income tax slab.

Optimise tax outgo by withdrawing systematically and using exemptions.

Steps to Manage Retirement Expenses
Budget your monthly expenses carefully to stay within income limits.

Limit discretionary spending to avoid overshooting your budget.

Set aside funds for annual or unexpected expenses, like travel or repairs.

Regular Review and Monitoring
Review your portfolio annually to ensure alignment with your goals.

Rebalance investments based on market conditions and life changes.

Consult a Certified Financial Planner for regular guidance and monitoring.

Finally
Your corpus, combined with rental income and your wife’s job, ensures financial stability. Proper allocation and disciplined spending will help you retire comfortably. Regular reviews will ensure your portfolio stays aligned with inflation and changing needs.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

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

...Read more

Ramalingam

Ramalingam Kalirajan  |7683 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jan 28, 2025

Asked by Anonymous - Jan 28, 2025Hindi
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I want to retire at 46, I am single unmarried, I have fixed deposit 90 lakh, 73 lakh in provident fund , PPF, NPS . Can I take voluntary retirement now at 46.
Ans: Your decision to retire at 46 is bold and inspiring. With a fixed deposit of Rs 90 lakh and Rs 73 lakh in provident fund, PPF, and NPS, you have a strong foundation. However, early retirement requires a detailed financial strategy to sustain your lifestyle for decades.

Key Considerations Before Retiring

Duration of Retirement

Retiring at 46 means planning for 40+ years of expenses.
Your corpus must support rising costs due to inflation.
Current Savings and Investments

Fixed deposits provide safety but offer limited growth.
Provident fund, PPF, and NPS are good for stability but lack liquidity.
Expenses Analysis

Assess your monthly expenses and project future costs.
Include inflation, healthcare, and lifestyle changes in calculations.
Challenges of Relying on Current Corpus

Inflation Impact

Inflation reduces the purchasing power of fixed returns.
Your corpus must grow to outpace inflation.
Lack of Liquidity

Provident fund, PPF, and NPS have withdrawal restrictions.
These funds may not be easily accessible during emergencies.
Long-Term Healthcare Needs

Healthcare costs are rising rapidly.
Without proper planning, these can deplete your savings.
Steps to Secure Early Retirement

Reassess Your Asset Allocation

Diversify your portfolio to include growth-oriented investments.
Equity mutual funds can help achieve inflation-beating returns.
Optimise Fixed Deposits

Fixed deposits offer low post-tax returns.
Shift a portion to debt mutual funds for better returns and tax efficiency.
Leverage Your NPS Investments

Use the NPS for long-term growth with equity allocation.
Regularly review its performance and adjust allocations if needed.
Creating a Sustainable Income Plan

Systematic Withdrawal Plan (SWP)

Use SWPs from mutual funds to generate a steady income.
This ensures cash flow while allowing your corpus to grow.
Emergency Fund Allocation

Maintain an emergency fund of Rs 10-15 lakh in a liquid fund.
This provides liquidity for unforeseen expenses without disrupting investments.
Health and Term Insurance

Ensure adequate health insurance to cover rising medical costs.
A term plan can protect your family if needed.
Tax-Efficient Wealth Management

Reduce Tax Liabilities

Fixed deposits and PPF offer limited tax-saving benefits.
Equity mutual funds provide better post-tax returns.
Strategic Withdrawals

Withdraw funds in a tax-efficient manner to minimise taxes.
Consult a Certified Financial Planner to optimise withdrawals.
Inflation-Proof Portfolio Strategy

Equity for Long-Term Growth

Increase exposure to actively managed equity mutual funds.
These funds aim to outperform and deliver inflation-beating returns.
Balanced Portfolio Allocation

Maintain a balance between equity and debt instruments.
This ensures stability while providing growth.
Avoid Over-Reliance on Index Funds

Index funds follow the market and may not offer superior returns.
Actively managed funds adapt to market changes for better performance.
Lifestyle and Financial Discipline

Review Your Lifestyle Needs

Assess your lifestyle and create a realistic budget for retirement.
Control discretionary expenses to extend the life of your corpus.
Plan for Future Goals

Allocate funds for long-term goals such as travel or philanthropy.
Regularly review and adjust your plan as circumstances change.
Stay Invested for Growth

Avoid holding excessive cash or low-return instruments.
Long-term investments are key to maintaining purchasing power.
Finally

Early retirement is possible with disciplined planning and execution.
Reassess your asset allocation to ensure sustained income and growth.
Invest in a diversified portfolio for inflation-beating returns.
Regularly review your financial plan and make adjustments when needed.
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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