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Ramalingam

Ramalingam Kalirajan  |7215 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 24, 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
Asked by Anonymous - Mar 23, 2023Hindi
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Hello Sir, I am 43 yrs of age and following is the list of my MF holdings which are all 15 Months Plus......Can you pls advice me if I should continue to remain Invested in the same or should I change any of these....I am looking at an aggressive and high return Funds in the next 3 Years....Also one very important point is all my Investments are thru an Agent, do you suggest i shud withdraw them all and go for Direct Plans.....Pls advice - SIP Details - CANARA ROBECCO EMERGING EQUITIES FUND – 10000 PGIM INDIA MID CAP OPPORTUNITIES FUND – 5000 ICICI PRUDENTIAL TECHNOLOGY FUND – 4000 SBI FOCUSED EQUITY FUND – 6000 QUANT ACTIVE FUND – 10000 MIRAE ASSET LARGE CAP FUND – 10000 INDIA INFOLINE - 5000 LUMPSUM Details - PGIM INDIA MID CAP OPPORTUNITIES FUND – REGULAR GROWTH – 3 LACS K1155 - KOTAK MULTICAP FUND – REGULAR PLAN GROWTH – 3 LACS AXIS MULTICAP FUND REGULAR PLAN GROWTH – 3 LACS IIFL FOCUSED EQUITY FUND – 4 LACS UTI FLEXI CAP FUND – 2.5 LACS MIRAE ASSET LARGE CAP FUND – 3 LACS LIC MF LARGE AND MID CAP FUND – 4 LACS CANARA ROBECCO BLUE CHIP EQUITY FUND – 3 LACS QUANT ACTIVE FUND – 2.5 LACS PARAG PARIKH FLEXI CAP FUND – 2.5 LACS

Ans: Let's analyze your portfolio and provide recommendations based on your aggressive investment stance and the desire for high returns over the next three years.

Portfolio Review:

You have a well-diversified portfolio with exposure to various equity categories, which is a good approach for long-term growth. Given your aggressive stance, let's assess your holdings:

Equity Funds:
You have exposure to large-cap, mid-cap, focused equity, technology, and flexi-cap funds. This diversification can potentially balance risk and return, but you might consider focusing more on aggressive funds for higher growth.
Direct vs. Regular Plans:
Investing through an agent (Regular Plans) involves a higher expense ratio due to commissions. While Direct Plans can reduce costs, your relationship with a trusted Mutual Fund Distributor (MFD) who provides personal emotional support can add value beyond just financial advice.
Recommendations:

Continue with Regular Plans through a Trusted MFD:
Given your aggressive stance and the emotional support you receive from your MFD, continuing with Regular Plans through your trusted MFD can align well with your investment goals. A supportive MFD can offer personalized advice, emotional reassurance, and keep you informed about market developments.
Focus on Aggressive Funds:
Emphasize funds with a proven track record of aggressive growth and high returns. Your MFD can help identify and recommend funds that align with your risk appetite and investment horizon.
Periodic Reviews with Emotional Support:
Schedule regular reviews with your MFD to evaluate your portfolio's performance and make necessary adjustments. A supportive MFD can offer emotional support during market fluctuations, helping you stay disciplined and confident in your investment decisions.
Build a Strong Relationship with Your MFD:
Embrace the relationship with your MFD who understands your financial goals, concerns, and provides emotional support. A strong relationship can enhance your investment experience, making it more reassuring and enjoyable.
Conclusion:

Given your aggressive stance and the importance of emotional support in your investment journey, continuing with Regular Plans through your trusted MFD seems suitable. Focus on aggressive funds, maintain regular reviews with your MFD, and nurture your relationship with them for personalized advice and emotional reassurance. Remember, investing is not just about numbers; it's about peace of mind, trust, and confidence in your investment decisions. Embrace this journey with your MFD by your side, and may your investments flourish over time.
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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Asked by Anonymous - Mar 21, 2023Hindi
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Hello Sir, I am 43 yrs of age and following is the list of my MF holdings which are all 15 Months Plus......Can you pls advice me if I should continue to remain Invested in the same or should I change any of these....I am looking at an aggressive and high return Funds in the next 3 Years....Also one very important point is all my Investments are thru an Agent, do you suggest i shud withdraw them all and go for Direct Plans.....Pls advice - SIP Details - CANARA ROBECCO EMERGING EQUITIES FUND – 10000 PGIM INDIA MID CAP OPPORTUNITIES FUND – 5000 ICICI PRUDENTIAL TECHNOLOGY FUND – 4000 SBI FOCUSED EQUITY FUND – 6000 QUANT ACTIVE FUND – 10000 MIRAE ASSET LARGE CAP FUND – 10000 INDIA INFOLINE - 5000 LUMPSUM Details - PGIM INDIA MID CAP OPPORTUNITIES FUND – REGULAR GROWTH – 3 LACS K1155 - KOTAK MULTICAP FUND – REGULAR PLAN GROWTH – 3 LACS AXIS MULTICAP FUND REGULAR PLAN GROWTH – 3 LACS IIFL FOCUSED EQUITY FUND – 4 LACS UTI FLEXI CAP FUND – 2.5 LACS MIRAE ASSET LARGE CAP FUND – 3 LACS LIC MF LARGE AND MID CAP FUND – 4 LACS CANARA ROBECCO BLUE CHIP EQUITY FUND – 3 LACS QUANT ACTIVE FUND – 2.5 LACS PARAG PARIKH FLEXI CAP FUND – 2.5 LACS
Ans: Given your desire for aggressive growth in the next 3 years, it's crucial to assess your current mutual fund holdings and make informed decisions. Here are some considerations:

Performance Review: Evaluate the performance of your existing funds over the past few years. Look at their consistency, returns, and how they have performed during different market cycles.
Risk Appetite: Consider your risk tolerance and whether your current funds align with your risk profile. Aggressive funds typically carry higher risk, so ensure you are comfortable with potential volatility.
Diversification: Check the diversification of your portfolio across different fund types (large cap, mid cap, small cap) and sectors. A well-diversified portfolio can help mitigate risk.
Expense Ratio: Assess the expense ratio of your funds, especially if they are regular plans. Direct plans generally have lower expense ratios, which can significantly impact returns over the long term.
Exit Loads and Tax Implications: Understand any exit loads or tax implications associated with redeeming your existing investments, especially if they are less than 3 years old.
Consideration of Direct Plans: Switching to direct plans can save on expenses in the long run, potentially boosting returns. However, ensure you are comfortable with managing your investments independently or seek the assistance of a fee-based advisor.
After considering these factors, you can decide whether to continue with your current holdings, reallocate investments, or explore new funds that align better with your goals and risk appetite. It's essential to periodically review your portfolio and make adjustments as needed to stay on track with your financial objectives.

..Read more

Hardik

Hardik Parikh  | Answer  |Ask -

Tax, Mutual Fund Expert - Answered on Apr 07, 2023

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ello Sir, I am 43 yrs of age and following is the list of my MF holdings which are all 15 Months Plus......Can you pls advice me if I should continue to remain Invested in the same or should I change any of these....I am looking at an aggressive and high return Funds in the next 3 Years....Also one very important point is all my Investments are thru an Agent, do you suggest i shud withdraw them all and go for Direct Plans.....Pls advice - SIP Details - CANARA ROBECCO EMERGING EQUITIES FUND – 10000 PGIM INDIA MID CAP OPPORTUNITIES FUND – 5000 ICICI PRUDENTIAL TECHNOLOGY FUND – 4000 SBI FOCUSED EQUITY FUND – 6000 QUANT ACTIVE FUND – 10000 MIRAE ASSET LARGE CAP FUND – 10000 INDIA INFOLINE - 5000 LUMPSUM Details - PGIM INDIA MID CAP OPPORTUNITIES FUND – REGULAR GROWTH – 3 LACS K1155 - KOTAK MULTICAP FUND – REGULAR PLAN GROWTH – 3 LACS AXIS MULTICAP FUND REGULAR PLAN GROWTH – 3 LACS IIFL FOCUSED EQUITY FUND – 4 LACS UTI FLEXI CAP FUND – 2.5 LACS MIRAE ASSET LARGE CAP FUND – 3 LACS LIC MF LARGE AND MID CAP FUND – 4 LACS CANARA ROBECCO BLUE CHIP EQUITY FUND – 3 LACS QUANT ACTIVE FUND – 2.5 LACS PARAG PARIKH FLEXI CAP FUND – 2.5 LACS
Ans: Hello Yatin,

Firstly, I appreciate that you've been consistently investing in mutual funds for more than 15 months. Based on your age and the 3-year investment horizon you mentioned, it's reasonable to have an aggressive investment strategy. However, I would also like to remind you that higher returns often come with higher risks.

Regarding your current holdings, I see that you have a well-diversified portfolio across large-cap, mid-cap, focused, and sectoral funds. Given your investment goals, you may consider continuing with most of these funds. However, I recommend reviewing the performance of the funds against their benchmark indices and their respective categories. You might want to consider replacing any underperforming funds with better-performing alternatives in the same category.

On the point of investing through an agent, I suggest you evaluate the benefits and drawbacks of switching to direct plans. Direct plans generally have lower expense ratios, which could result in higher returns over time. However, if you value the guidance and support provided by your agent, you might want to stick with the regular plans.

If you decide to switch to direct plans, you can do so without redeeming or selling your existing investments. You can start by converting your future SIPs to direct plans and then gradually switch your existing holdings.

Please note that this advice is based on the limited information you provided and should not be considered as personalized financial advice. I recommend that you consult with a certified financial planner or advisor for a detailed analysis of your portfolio and investment goals.

Wishing you the best in your investment journey!

..Read more

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Insurance, Stocks, MF, PF Expert - Answered on Dec 07, 2024

Asked by Anonymous - Dec 07, 2024Hindi
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I’m 50 year old professional considering early retirement.. My current investments stand like this 50L in PF, 52L in NPS and another 50 lakhs in FD.. I hv a rent income of 20k and staying in own house.. my plan is investing 40 Lakhs from FD in to SWP withdrawing 40K per month. Balance 10L kept as Emergency fund Keep the NPS invested till I’m 60 later I can buy Annuity from that Is it good option to keep 52L that is in PF for next 3 years (till it earns interest) then I will consider to invest either in SWP or any other mutual funds Pls suggest any corrections needed to this? My monthly expenses will be around 50-60 k that can be met with above arrangement now and later considering inflation
Ans: Hello;

To generate 40 K monthly income from 40 L fund you will have to do SWP at the rate of 12% which is unsustainable and not prudent.

Because an year of negative and/or flat returns in the market will erode the value of your corpus significantly.

Golden rule for SWP in retirement is that the source fund should be a hybrid fund with low allocation to equity and the SWP rate should not be more than 3-3.5%.

If you are keen to retire now you will have to withdraw the EPF so total corpus will be around 1 Cr.

A 3.5% SWP will yield you a monthly income of around 29.2 K.

Add your rental income of 20 K to this and your total monthly income comes to around 49.2 K.

If you do not wish to utilise your EPF now then you may have to continue working for atleast 5 years more.

Alternatively you may buy an immediate annuity for your corpus of 1 Cr and considering 6% annuity rate it may fetch you a monthly income of around 50 K but the flip side it is not indexed to inflation.

If you are confident of being able to top-up annuity income at 5, 10,15 year interval to match up with inflation then this can be a good option.

Best wishes;

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Ramalingam

Ramalingam Kalirajan  |7215 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Dec 07, 2024

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I am 65 year age retired and have no pension. I have made investment in few govt schemes and get some regular income by way of interest but due to inflation and low interest rates scenario emerging pl suggest basket of investment to get regular monthly income of Rs 50000 . I have handsome amount in ppf account which is about to mature
Ans: Your situation reflects prudent planning with investments in government schemes and a maturing PPF. However, inflation and low interest rates demand a diversified strategy for consistent and inflation-adjusted income.

Steps to Achieve Rs. 50,000 Monthly Income
1. Reassess Your Current Investments

Evaluate the performance of your government schemes and compare their returns.
Retain investments offering guaranteed and steady income, like Senior Citizen Savings Scheme (SCSS) or Post Office Monthly Income Scheme (POMIS).
Redeploy funds from low-yield investments to more productive avenues.
2. Utilise the Maturing PPF

PPF offers tax-free corpus. Use this to create a diversified portfolio for stable income and growth.
Split the PPF corpus into equity mutual funds and safer debt instruments.
3. Diversify with Debt and Hybrid Funds

Invest in conservative hybrid funds to generate regular income and protect capital.
Include short-term and medium-term debt funds for steady returns, which are higher than fixed deposits.
4. Set Up a Systematic Withdrawal Plan (SWP)

Use equity or hybrid mutual funds to set up SWPs.
An SWP ensures a steady monthly income while your capital continues to grow.
5. Consider Dividend-Yielding Funds

Dividend-paying mutual funds offer periodic cash flow and potential for capital appreciation.
6. Fixed Income Instruments for Safety

SCSS: Offers assured returns and is tailor-made for senior citizens. Invest up to Rs. 30 lakh as a couple.
POMIS: Provides reliable income for smaller investments.
7. Include Tax-Free Bonds

Invest in high-quality tax-free bonds for steady, tax-efficient interest.
Creating the Income Plan
To achieve Rs. 50,000 per month:

Allocate a portion of funds to safer options like SCSS, POMIS, and tax-free bonds for stability.
Use equity and hybrid funds for growth and inflation protection.
Combine these with SWPs for regular income.
Tax Planning
Interest from SCSS and POMIS is taxable, so invest carefully.
Equity mutual funds have tax-efficient withdrawal options.
Debt funds offer indexation benefits for long-term investments.
Emergency and Health Fund
Keep at least 12 months of expenses in a liquid fund for emergencies.
Maintain your health insurance to handle rising medical costs.
Final Insight

A mix of secure instruments, mutual funds, and systematic withdrawals can comfortably generate Rs. 50,000 monthly income. Periodically review your plan with a Certified Financial Planner to adapt to changing needs and market conditions.

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

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What should be the corpus one should have in order to get 150000 per month post retirement ??
Ans: To determine the required corpus, let’s address key factors like expenses, inflation, withdrawal strategy, and longevity. A comprehensive plan ensures sustainability.

Factors Influencing Corpus
Monthly Income Requirement
Rs. 1,50,000 per month translates to Rs. 18,00,000 annually.

Inflation Impact
With an average inflation rate of 6%, future expenses will significantly increase.

Withdrawal Rate
A safe withdrawal rate is typically 3-4% per year. This ensures the corpus lasts throughout retirement.

Post-Retirement Investment Returns
Assume a conservative return of 7% from a balanced portfolio after retirement.

Longevity
Plan for a 30-35 year retirement horizon to ensure financial independence.

Calculating the Corpus
Using a 4% withdrawal rate, the corpus should be:
Rs. 18,00,000 ÷ 4% = Rs. 4.5 crore.

Adjust for Inflation:
If retirement is 10 years away and inflation is 6%, you’ll need about Rs. 8 crore to maintain the same lifestyle.

Steps to Build This Corpus
Increase Equity Exposure Now
High-growth equity funds can accelerate wealth accumulation during the pre-retirement phase.

Gradual Shift to Conservative Assets
Transition to hybrid or debt funds five years before retirement to protect the corpus from market volatility.

Systematic Withdrawals
Post-retirement, use SWPs in mutual funds to create a steady monthly income of Rs. 1,50,000.

Health and Emergency Funds
Maintain a separate contingency fund to handle medical emergencies and other unexpected costs.

Tax Implications
Equity Fund Withdrawals:
LTCG above Rs. 1.25 lakh taxed at 12.5%.

Debt Fund Withdrawals:
Taxed as per your income slab.

Plan withdrawals tax-efficiently to optimise cash flow.

Final Insight

With proper planning, achieving a corpus of Rs. 8 crore is feasible for a comfortable retirement. Consult a Certified Financial Planner to optimise your investments and roadmap.

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

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Hi, I have been an introvert guy for my whole life, but somehow I always got good colleagues which became great friends. But from last 5 years I am in a office where very few people works and that too they are not connected to me. Hence, I get a very little exposer with them. Feels so much lonely in office as there is not a lot of workload also. Most of my day goes watching reels on social media. Sometimes i forgot when last i smiled/laughed at office place where I spends 9 hours of my day (I do talk to my family over phone, but can't help my loneliness). what can I do....worried... A very lonely 45 year male.....
Ans: Dear Sunil,

No one is clear cut introvert or an extrovert, look at yourself closely too... in some circumstances you behave like an extrovert and some areas you behave like an introvert.

Be brave and say "hi" to people around you in the office, you be the first one to greet, this itself can be a starting point to making new friends. A smile and a pleasant "hi" is all it takes.
Look for opportunities to connect with ppl in the office, instead of sending mails or reminders to ppl electronically, just walk up to them and speak to them or call them up to say you have sent a mail/reminder. This way you can establish a human connect.
Also check if you can go to the dining area to eat lunch and during breaks.. do not sit at your desk and have lunch.
Social media and watching reels is a "big no" if you are yearning for human connections. I am glad you talk to your family...outside the office, join book clubs, singing clubs, drama clubs or anywhere your interest lies...you can join a classroom to learn and develop a new skill....

Also check if you are getting enough sleep, exercise, fresh air , sunshine during the day....focus on your diet too!!

Hope this helps... take care of yourself!

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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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