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Ramalingam Kalirajan |10874 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on Jul 18, 2025

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

Asked by Anonymous - Jul 17, 2025Hindi

Dear expert, Im 48, laid off jobless since 2 yrs All i have is savings of 25 -30 lakhs and own house, own car, no land investments, few mutual funds 3 lks and 1 term insurance and 1 family health insurance covering all. No loans, no debts to anyone, no credit cards. Since an yr i put abt 3-4 lks in trading and making little money. However with just 3 people at home, my monthly expenses are very less- milk, paper, no power bill ( coz on solar), no water bill. Just groceries and any eating out. Yearly property tax and car insurance, term insurance totalling to 50k approx. A kid studying 12th class, i have accumulated some money for the education seperately. Currently im doing partime and earning 20k per month which takes care. Please advice if im good financially. Or make better, if i need to be worry free for next 10-15 yrs.

Ans: You are 48, with no loans, no credit cards, and own your house and car. You live with minimal monthly expenses. You have Rs.?25–30?lakh in savings and Rs.?3?lakh in mutual funds. You earn Rs.?20,000 per month through part-time work and trade with a small corpus. Your lifestyle is frugal and efficient. You are managing things very well despite uncertainties.

Let’s now assess your current position, highlight strengths, and show how to make it more stable for the next 15 years.

? Your Lifestyle and Expense Discipline is Excellent
– Living without power or water bills reduces burden.
– Having low monthly expenses shows great control.
– You only spend on groceries, milk, and small outings.
– Your annual fixed expenses are around Rs.?50,000.
– You are saving more by keeping things simple.
– This lifestyle can help money last longer.
– It is a rare and strong advantage in uncertain times.

? You Are Debt-Free and Asset-Light
– No home loan or car loan keeps stress low.
– You own both home and vehicle, so no EMI.
– No credit card usage shows discipline.
– This financial freedom gives mental peace.
– You are protected from rising interest rates.
– It gives you flexibility to manage low income phases.
– This is a strong foundation for retirement years.

? Your Emergency Fund Seems Adequate
– Rs.?25–30?lakh savings is a strong cushion.
– Even with no new job, you have room to plan.
– If your expenses are Rs.?20,000 monthly, savings can last over 10 years.
– Emergency fund should be kept in liquid or ultra short-term mutual funds.
– Avoid keeping all money in bank savings account.
– Divide your cash into short-term and medium-term buckets.
– This will protect your capital and also beat inflation slowly.

? You Have Basic Protection in Place
– Term insurance protects your family in your absence.
– Family floater health insurance is already there.
– Please check the sum insured.
– It should be Rs.?10–15?lakh minimum.
– Keep renewing it yearly without gaps.
– As you grow older, health insurance becomes vital.
– This reduces the need to use savings for medical bills.
– Ensure your policy covers major illnesses and has good hospital coverage.

? Education Planning is Already Done
– You have set aside money for your child’s education.
– That is excellent planning.
– Don't use that for day-to-day needs.
– Keep it in short-term mutual funds or FD if admission is near.
– Avoid investing it in stock market or long-term funds now.
– That money must be kept stable and safe.

? Part-Time Income Is a Great Buffer
– Rs.?20,000 monthly covers your regular household needs.
– This avoids touching your savings.
– You have built a lifestyle that matches your income.
– That is the best financial strategy at this stage.
– Try to continue this income source for few more years.
– Explore home-based work or freelancing options to increase it.
– Even small increases in income will delay need for savings withdrawal.

? About Trading as a Source of Income
– Trading with Rs.?3–4?lakh is fine for testing.
– But don’t depend on it fully.
– Trading profits are not predictable or consistent.
– Market conditions can change overnight.
– Don’t put all your savings in trading.
– Limit it to a maximum 10% of your corpus.
– Avoid using savings meant for living expenses.
– Consider trading as hobby, not income replacement.

? Existing Mutual Funds Should Be Reviewed
– Rs.?3?lakh in mutual funds is a good start.
– Check if these are in regular plans and actively managed.
– Avoid index funds as they carry all stocks, good or bad.
– Active mutual funds are monitored and adjusted by professionals.
– Regular plan via MFD ensures ongoing support and advice.
– Direct plans lack that guidance and monitoring.
– Since your needs are unique, regular route is safer.
– Review these funds with a Certified Financial Planner.

? Suggested Asset Allocation Going Forward
– Keep Rs.?10–12?lakh in safe liquid and short-term mutual funds.
– This will act as your income support for next 5 years.
– Another Rs.?8–10?lakh can go into hybrid mutual funds.
– These give steady growth with moderate risk.
– The remaining Rs.?6–8?lakh can be in equity mutual funds.
– This can be used after 7–8 years, so risk is manageable.
– Keep reviewing this allocation every 6 months.
– Shift to safer funds as you grow older.
– Don’t withdraw money from equity during market downs.

? Avoid Buying Any New Property or Land
– Property resale takes time.
– Renting may not generate enough regular income.
– Maintenance and taxes eat into returns.
– You already have a house.
– Focus now on liquid and tax-efficient financial investments.

? Plan for Next 10–15 Years
– Use your existing savings wisely to create monthly cash flow.
– Don’t withdraw everything at once.
– Start a Systematic Withdrawal Plan (SWP) after 5 years.
– SWP gives you regular income without touching main capital.
– Till then, depend on your part-time income and liquid fund.
– This delay in withdrawal helps your corpus grow.
– Avoid making emotional investment choices during market ups and downs.
– Stay consistent and patient.

? Tax Planning for Investments
– Equity mutual funds have tax benefits if held long term.
– LTCG above Rs.?1.25?lakh is taxed at 12.5%.
– STCG is taxed at 20%.
– Debt fund gains are taxed as per income slab.
– So choose holding period carefully.
– SWP also spreads out taxes more smoothly.
– You can also use 80C and 80D for tax savings if needed.
– Avoid locking too much in ELSS just for saving tax.
– Retirement income should be tax-optimised but flexible.

? Monitor and Review Regularly
– Don’t invest and forget.
– Every 6 months, review expenses and investment performance.
– Check if your income and savings are in balance.
– Make small adjustments if needed.
– Avoid panic selling or impulsive investing.
– A Certified Financial Planner can help make these reviews easier.
– Their ongoing advice will give more confidence and clarity.

? You Don’t Need to Panic
– You are not in financial danger now.
– You have planned with foresight.
– Your cost of living is low and well-managed.
– You already have health and term protection.
– Education needs are covered.
– Your lifestyle is simple and sustainable.
– With wise investing, your money can last beyond 15 years.
– You are better placed than many others in your age group.

? Things to Avoid Going Forward
– Don’t lend money to friends or relatives from savings.
– Don’t invest in unknown or high-return schemes.
– Don’t increase lifestyle expenses suddenly.
– Don’t take personal loans or use credit cards.
– Don’t ignore health insurance renewal or health checkups.
– Don’t put all money in one type of investment.

? Finally
Your base is strong.
Your lifestyle is simple.
Your savings are intact.
You have no debt, and your basic needs are covered.
The next 10–15 years can be peaceful if you follow discipline.
Avoid high-risk investments.
Use mutual funds with MFDs and CFP support.
Plan withdrawals slowly, not all at once.
Keep tracking your plan every 6 months.
That way, you stay worry-free, financially and emotionally.
Keep the mindset that got you this far.
You are already doing most things right.

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

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.