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Ramalingam

Ramalingam Kalirajan  |7026 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 12, 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 - Apr 23, 2024Hindi
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Hello Gurus. I am 45 years old and working in a private firm. I plan to retire in about 15 years. I have adequate amount of savings in PPF, EPF, FDs and some Mutual Funds. Can you suggest what amount i need to invest monthly/yearly in a good SWP, for a withdrawal of say Rs 60,000 a month after 15 years.

Ans: It's commendable that you're planning ahead for your retirement. Let's calculate the amount you need to invest regularly in a Systematic Withdrawal Plan (SWP) to achieve your goal of withdrawing Rs 60,000 per month after 15 years.

Firstly, we need to determine the future value of your monthly withdrawals. Using a retirement calculator or financial planning software, we can estimate the corpus required to sustain a monthly withdrawal of Rs 60,000 for your desired retirement period, accounting for inflation and potential investment returns.

Once we have the estimated corpus needed, we can work backward to determine the required monthly/yearly investment in a suitable investment vehicle with growth potential, such as equity mutual funds or a balanced portfolio, to accumulate that corpus over the remaining 15 years.

Given your existing savings in PPF, EPF, FDs, and Mutual Funds, we'll consider integrating the SWP strategy with your overall portfolio to optimize returns and manage risk effectively.

It's crucial to review and adjust your investment strategy periodically to adapt to changing market conditions, financial goals, and risk tolerance.

Consulting with a Certified Financial Planner will provide personalized insights and recommendations tailored to your specific circumstances, ensuring a robust retirement plan aligned with your aspirations and financial objectives.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
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  |7026 Answers  |Ask -

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

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Sir,I am Sreejith..I am looking to do an SWP for my father, who is 70 years old now, targeting a monthly withdrawal of Rs.10,000/-. The lumpsum amount intending to invest is Rs.8-9 lakhs. Is this possible with this amount to withdraw an amount of of Rs.10,000/-.per month? Which type of mutual funds are good for doing SWP ? Is it wise to do SWP in equity oriented funds like large cap, Mid cap,Flexi cap etc. Also is it good to do SWP in two mutual funds with the above Rs.8-9 lakhs. ?Sir, Iam expecting your valuable reply.
Ans: Systematic Withdrawal Plan (SWP) is an excellent way to ensure regular income during retirement. Given that your father is 70 years old, it's important to balance growth and safety. Let’s assess your situation to provide a 360-degree solution.

Assessing the Lumpsum Amount
Investment Corpus: You intend to invest Rs. 8-9 lakhs. This amount is crucial in determining the monthly withdrawal amount of Rs. 10,000.

Sustainability of SWP: With Rs. 8-9 lakhs, withdrawing Rs. 10,000 monthly could be challenging over a long period. Let's explore how this can be managed.

Understanding SWP in Different Mutual Funds
Equity-Oriented Funds: These funds, such as large-cap, mid-cap, and flexi-cap, generally provide higher returns. However, they are also volatile. While equity can provide inflation-beating returns, it might not be the best sole option for a 70-year-old.

Hybrid Funds: A balanced or hybrid fund combines equity and debt. This mix can provide growth with lower volatility. It’s safer for an SWP at your father’s age.

Debt Funds: These funds are safer and less volatile. They might not offer high returns but can provide stable income. They are often used for SWP by retirees to preserve capital.

Which Type of Mutual Funds Are Good for SWP?
Balanced Approach: Combining equity and debt funds can create a balanced portfolio. This approach offers both growth and safety.

Two-Fund Strategy: Splitting the Rs. 8-9 lakhs into two different funds can diversify risk. One fund could be a hybrid fund, and the other a debt fund. This combination can provide stability and growth.

Safety First: Considering your father's age, prioritise safety. The bulk of the investment should be in debt or hybrid funds. A smaller portion can be in equity to capture growth potential.

Is SWP in Equity-Oriented Funds Wise?
Risk Consideration: Pure equity funds can be risky for someone in retirement. Market fluctuations can affect the fund value, impacting the sustainability of the SWP.

Diversification: If opting for equity-oriented funds, ensure they are part of a diversified portfolio. Avoid putting the entire amount in high-risk funds.

Long-Term Growth: While equity can provide good returns, it’s crucial to balance it with safer options, especially when relying on the funds for regular income.

Practical Insights on SWP Execution
Withdrawal Sustainability: If you withdraw Rs. 10,000 monthly from Rs. 8-9 lakhs, the sustainability depends on the fund’s performance. In a conservative estimate, this might last for 8-10 years in a balanced portfolio.

Reinvestment of Gains: If the funds perform well, you can reinvest the gains to extend the SWP period. This requires regular monitoring.

Consulting a CFP: To ensure the strategy aligns with your father’s needs, consult a Certified Financial Planner. They can tailor the fund selection to match his risk profile and income requirements.

Final Insights
Balanced Portfolio: Prioritise a mix of equity and debt, leaning more towards safety due to your father's age.

Two-Fund Strategy: Split the investment into two different funds to diversify risk and ensure stable withdrawals.

Monitoring: Regularly review the performance of the funds. Adjust the SWP if required to maintain sustainability.

Best Regards,

K. Ramalingam, MBA, CFP

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Moneywize

Moneywize   |174 Answers  |Ask -

Financial Planner - Answered on Aug 22, 2024

Asked by Anonymous - Aug 22, 2024Hindi
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I am Sankalp. I am looking to do a Systematic Withdrawal Plan for my mother, who is 60 now. I am targeting a monthly withdrawal of Rs 10,000. The lump sum amount intending to invest is Rs 10-12 lakh. Is this possible with this amount to withdraw an amount of of Rs 25,000 per month? Which type of MFs are good for doing SWP? Is it wise to do SWP in equity oriented funds? Also is it good to do SWP in two mutual funds with the above Rs 10-12 lakh?
Ans: To achieve a monthly withdrawal of Rs 25,000 with a lump sum of Rs 10-12 lakh, the investment would need to generate a return of around 25-30 per cent annually, which is unrealistic for a sustainable and low-risk plan, especially for a retiree. A more reasonable withdrawal rate is around 6-8 per cent annually, which would give you Rs 10,000 to Rs 12,000 per month from that investment.

Suitable Mutual Funds for SWP:

• Hybrid Funds (Balanced Funds): These funds invest in both equities and debt, balancing growth potential with lower volatility. They are suitable for moderate risk and could provide a steady income.
• Debt Funds: These funds are less volatile and offer more predictable returns, making them good for stable withdrawals, though the growth potential is lower compared to equities.
• Conservative Hybrid Funds: These funds have a higher allocation to debt and a smaller portion in equity, making them more conservative but still offering some growth.

SWP in Equity-Oriented Funds:

Equity funds can offer higher returns over the long term, but they are volatile. SWP from equity-oriented funds could result in selling units at a loss during market downturns, which may not be ideal for generating steady income. For your mother, who is 60, a balance between equity and debt could be more suitable to manage risk.

Splitting the Investment:

Investing in two different funds for SWP is a good strategy for diversification. You could allocate one part to a hybrid or balanced fund for moderate growth and another to a debt fund for stability.

Recommendation:

Consider starting the SWP from a hybrid or balanced fund for moderate risk and some exposure to growth. Add a conservative debt fund for stability.

If you’re targeting Rs 10,000 per month, an investment of Rs 10-12 lakh should work well with lower withdrawal rates of around 6-8 per cent. For Rs 25,000 per month, you may need a higher investment or explore other income-generating assets alongside SWP.

Here are some specific mutual fund categories and examples that could suit your SWP strategy, considering your goal of stable withdrawals for your mother:

1. Hybrid Funds (Balanced Advantage Funds):

These funds automatically adjust their equity and debt exposure based on market conditions, providing a mix of growth and stability.

Examples:

• ICICI Prudential Balanced Advantage Fund
• HDFC Balanced Advantage Fund

These funds are suitable for moderate risk, with potential for long-term growth while providing a stable income.

2. Conservative Hybrid Funds:

These funds have a higher allocation to debt and a smaller portion in equity, making them more conservative. They offer lower volatility and steady income.

Examples:

• ICICI Prudential Equity & Debt Fund
• HDFC Hybrid Debt Fund

These funds are suitable for low-risk investors who still want some equity exposure for growth potential.

3. Debt Funds (Short-Term or Corporate Bond Funds):

Debt funds provide stable returns with low risk, which is ideal for conservative investors. They are more predictable but offer lower returns compared to equity.

Examples:

• SBI Magnum Medium Duration Fund
• HDFC Corporate Bond Fund

These funds are good for regular income generation while maintaining capital preservation.

Suggested Allocation:

• 50 per cent in a Balanced/Hybrid Fund: This will provide moderate growth with some equity exposure.
• 50 per cent in a Debt Fund: This will stabilise the income and protect against market volatility.

By splitting the Rs 10-12 lakh investment between these two types of funds, you could balance risk and growth potential while generating a steady income through SWP.

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Dr. Shyam, I had my teeth cleaned 6 months ago and after that was done I saw discoloration on certain teeth that wasn't there before. Years ago I had my teeth cleaned and one particular tooth after the cleaning was sensitive to touch. I had a crown put in from two different dental offices. The first one did the crown right, but was trying to charge me $3,500 more than the agreement they made with Medicare. Medicare corrected that. I other dentist did a crown and it didn't go all the way up to my gums and is sensitive to especially cold things. I'm not having very good experiences with dentist by and large. Can't find an honest one or one that can actually do the job right. I feel being on Medicare your a target to bring in money. Not sure what to do next. Supposed to go back and have them redo the crown that didn't go to my gums, but it also was ttd place to didn't clean my teeth right and discolored some of them. Any suggestions on how to trust there is actually an capable and honest dentist out there who can perform properly?
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Hi, I am 30 years old not married & now my parents are forcing me to get married. I think i am good looking guy. It's not like i have never been with girls. I have had brief flings with multiple girls. And there was one girl whom i was in a platonic relationship with with lot of emotional sharing & have spent a lot of time with her. The same goes with another girl. Both of them have told me that i have been pretty cool & girls would like me to be their bf or husband. But i am not able to accept anyone because of the guilt that of my past that i never had a relationship. Never been able to tell anyone that i had a gf. I know this is wrong to compare my life but i can't stop thinking that way. Can you tell me what to do? Like a contsant regret of not having a very steamy cool fancy relationship from outside. I know relationships have it's own ups & downs. But this guilt is killing me that i missed out lot of things in life & if get married in an arranged marriage i would feel myself to be a looser who couldn't even find a girl on his own. Though i know all of these comparisons are wrong & i should be rational. I am not able to help it. Please help me out
Ans: Dear Anonymous,
Whatever you are feeling, it is very normal. More people than you could imagine go through this same phase. But as you mentioned, these are just thoughts; there is no truth to them. Not having a relationship does not make you uncool. It merely means that you did not meet your perfect match yet. I understand that you feel like you have missed out on something and that feeling is valid. It might not be reasonable, but it's very natural to think this way. I can suggest one thing- why don't you try a dating or matchmaking app to find your own partner? That way, you will be keeping your parents' wishes and won't let yourself down either. It will also give you more control over choosing your life partner.

Hope this helps.

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Ravi

Ravi Mittal  |416 Answers  |Ask -

Dating, Relationships Expert - Answered on Nov 14, 2024

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Hi, I got married to my ex gf in an arranged setup. I had a 7 year of relationship with her before breakup. My career switch try from private to govt job was the reason. When I failed I returned back to corporate. 3 years after the breakup her father who is a good friend of my father sent proposal which led to our marriage. No one knew that we dated. We never had a word between the acceptance and marriage. None of us initiated the conversation. When she came after marriage her behavior towards me in private is totally strange. We never had an emotional conversation. Neither we discuss romance nor intimacy. In private we hardly have any intellect discussions which was an eternal part before our breakup. But when she is in public she behaves like she cares for me a lot. She is a darling of everyone in the house whether my parents or siblings. Most of the time she remains with my mother and she has good bond. In front of her she cares for me a lot. She had this double faced attitude from the first day. Our intimacy is limited to my ask she could agree or disagree but she never initiated it. She was pretty passionate before our breakup which I never saw after our marriage. I tried everything but nothing has happened she never opened up. She disconnected with almost all our mutual friends after marriage. Whenever I tried through some of her friends she says to them I overthink a lot. Marriages and relationships differs. All useless and weird reasons. Everyone blames my teenage short temper issue. Which I have completely overcame when I started working. After marriage we had a boy. She says no for a next child for which I am fine. But the problem is now my child is growing and she has started understanding her hypocrisy. Now she blames me for teaching him wrong things. We hardly had fights as she walks out or I won't say word usually after she didn't answer for anything. I am unable to see the light in this relationship. She had 3 relationships in between but I never had one which I never discussed. Now I hardly ask for anything. Day by day we are becoming only room partners or fake couples in public. Everyone sees her as an ideal daughter in law or wife due to her public hypocrisy. Please guide.
Ans: Dear Salman,
I understand that marital issues take a huge toll on people. Whatever you are feeling, it is very normal. I strongly suggest you seek professional help- you can either opt for personal counseling sessions to manage the distress caused by your partner's indifference, or the best approach is to convince your wife to go for marriage counseling with you. It would be good to get to the root of the matter; why is she behaving a certain way, where is this coming from, are there unresolved issues from when you dated? These questions will finally get an answer and you can work on them together. If she does not agree to go, tell her to do it for your child. No child should have to see their parents unhappy with each other.

Hope this helps.

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Dr Nagarajan J S K   |163 Answers  |Ask -

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I want to give NEET exam but my 12th in Maharashtra Board marks are less than 150 in PCB (general), so I am not eligible. can I give retest of 12th to get better marks so that I can give NEET.
Ans: Hi, Being a retest candidate is considered a second attempt in +2. I think the medical council will not allow admission to medicine. Instead, you can consider B.Pharm / Pharm D.

To join, the following are the requirements:

For pharm D: Minimum qualification for admission to. – a) Pharm.D. Part-I Course – A pass in any of the following examinations - (1) 10+2 examination with Physics and Chemistry as compulsory subjects along with one of the following subjects: Mathematics or Biology. (2) A pass in D.Pharm course from an institution approved by the Pharmacy Council of India under section 12 of the Pharmacy Act. (3) Any other qualification approved by the Pharmacy Council of India as equivalent to any of the above examinations. Provided that a student should complete the age of 17 years on or before 31st December of the year of admission to the course.

FOR B.PHARM:
Minimum qualification for admission to – A. First year B. Pharm – A pass in any of the following examinations - i. Candidate shall have passed 10+2 examination conducted by the respective state/central government authorities recognized as equivalent to 10+2 examination by the Association of Indian Universities (AIU) with English as one of the subjects and Physics, Chemistry, Mathematics/Biology as optional subjects individually. “However, the students possessing 10+2 qualification from non-formal and non-class rooms based schooling such as National Institute of Open Schooling, open school systems of States etc. shall not be eligible for admission to B.Pharm Course.” ii. Any other qualification approved by the Pharmacy Council of India as equivalent to any of the above examinations. Provided that a student should complete the age of 17 years on or before 31st December of the year of admission to the course. Provided that there shall be reservation of seats for the students belonging to the Scheduled Castes, Scheduled Tribes and other Backward Classes in accordance with the instructions issued by the Central Government/State Government/Union Territory Administration as the case may be from time to time.

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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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