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Ramalingam Kalirajan |10874 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on Aug 26, 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

Question by Darshan on Aug 26, 2025Hindi

Hello. I am 43 years old. Current portfolios is 1.35 crs in mutual funds. 25 lacs fd. Having life cover of 1.5 cr and mediclaim of 50 lacs. Real estate portfolio is 1 cr (2 flats on rent). No home loan or car loan. Have 1 child of 9 years age. Current monthly sip of 1.75 lacs. I plan to retire at 50. Am I on right track ?

Ans: You have built a very good base at 43. Your commitment to investing Rs.1.75 lakh monthly SIP shows excellent financial discipline. You are debt-free, covered with adequate insurance, and also earning rental income. These factors place you in a strong position. Still, retirement at 50 is an early retirement, so you must evaluate carefully from all angles. Let me give you a 360-degree analysis.

» Current Portfolio Position
– Mutual funds corpus of Rs.1.35 crore is a solid foundation.
– FD of Rs.25 lakh provides safety and liquidity.
– Real estate worth Rs.1 crore gives additional support with rental income.
– Life cover of Rs.1.5 crore is good for your family’s protection.
– Mediclaim cover of Rs.50 lakh ensures medical emergencies are addressed.
– Ongoing SIP of Rs.1.75 lakh is very powerful for wealth creation.

You have balanced growth, safety, and protection.

» Expense Requirement and Early Retirement Risk
– You want to retire at 50, so corpus should support at least 35 years of life.
– Expenses will not remain static. Inflation will increase costs 2–3 times in retirement.
– Retiring early reduces earning years and increases retirement years.
– This creates high demand on your portfolio.
– So corpus size must be much larger compared to retiring at 60.

This is the most critical part to evaluate.

» Education Goal for Child
– Your child is 9 years old.
– In next 8–9 years, higher education expenses will arise.
– Education costs are rising faster than normal inflation.
– This goal should be secured separately.
– Do not mix retirement corpus with child’s education funding.

Securing education first will make retirement planning clearer.

» Role of Your Current SIPs
– Monthly SIP of Rs.1.75 lakh is significant.
– In 7 years, this can create a large additional corpus.
– Power of compounding will accelerate growth.
– Choice of mutual funds also matters – equity for growth, some debt for stability.
– Actively managed funds work better than index funds in your case, because you need stability and flexibility in retirement planning.

This SIP commitment can take your corpus to a comfortable level if maintained consistently.

» Real Estate and Rental Income
– Two flats on rent add security.
– Rental income provides steady cash flow.
– But do not depend entirely on rental income.
– Rental yield in India is low compared to expenses.
– Real estate value may not grow as fast as equity.
– So treat real estate as supplementary, not primary retirement pillar.

Diversification beyond property is still essential.

» FDs and Their Role
– FD of Rs.25 lakh is good for liquidity.
– But FD returns are fully taxable at slab rate.
– Inflation can reduce their real value.
– Better to keep only limited amount in FD for emergencies.
– Rest can be shifted to debt mutual funds for better tax efficiency and flexibility.

FD should remain a liquidity cushion, not a wealth builder.

» Life Insurance Cover
– Rs.1.5 crore life cover is okay now.
– But with large portfolio already in place, your insurance need reduces.
– After 50, if corpus is strong enough, you may not even need term insurance.
– At that stage, your wealth itself acts as insurance.

For now, continue till you reach closer to retirement target.

» Medical Insurance
– Rs.50 lakh mediclaim is strong.
– Ensure it covers family as well.
– Health costs rise fast with age, so keep policy active lifelong.
– This will prevent retirement corpus from getting disturbed.

Health cover is non-negotiable for early retirees.

» Can You Retire at 50?
– Yes, it is possible, but depends on few conditions:

You must keep SIPs going till 50 without interruption.

You must separate child’s education funding in advance.

You must plan systematic withdrawal strategy post retirement.

You must balance equity and debt allocation properly.
– With 7 years of disciplined investing, corpus can grow big enough.
– But after retirement, growth allocation in equity is still needed.
– Entire corpus cannot be shifted to safe instruments, or inflation will eat into value.

So retiring at 50 is on track, provided you remain disciplined.

» Retirement Income Strategy Post 50
– Relying only on dividends or rent is not enough.
– Growth + SWP from mutual funds is better.
– SWP gives predictable income and better tax efficiency than dividends.
– Rental income can act as additional support, not primary.
– Keep at least 10–12 years of expenses in low-risk debt funds.
– Keep balance in equity for long-term growth.
– Review portfolio yearly with a Certified Financial Planner.

This combination of growth and safety will keep you comfortable.

» Psychological and Lifestyle Readiness
– Retirement is not only about money.
– You will have nearly 40 years of life post-retirement.
– You must plan activities, engagement, and health routines.
– Otherwise, early retirement may bring boredom or regret.
– Financial independence allows freedom, but purpose gives fulfillment.

Think about how you want to spend time after 50.

» Risks to Watch Out
– Market downturn just before retirement can impact corpus.
– Inflation can erode purchasing power.
– Child’s education costs may be higher than expected.
– Medical costs may rise with age despite insurance.
– Real estate may not generate higher rent in future.

Regular monitoring and flexibility in withdrawals will help handle these risks.

» Finally
– You are on a strong path with no loans, large SIPs, and good insurance cover.
– Retiring at 50 is possible if you protect child’s education goal separately.
– Maintain SIP discipline till 50 to strengthen corpus.
– Shift from dividend to growth + SWP strategy for efficiency.
– Keep balanced allocation between equity and debt even after retirement.
– Use rental income as support, not main pillar.
– Review with Certified Financial Planner every year to stay aligned.

Your discipline and foresight make early retirement achievable.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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

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