I Want To Sell My Land: How Can I Maximize My Profit And Secure My Future?

Hello Respected sir, I have an old land worth 2 crore which I am planning to sell.Original sale deed is of Rs 1 lakh Can you please help me: 1. How much tax have to pay? 2. Where should I invest rest for max return? 3. Currently living on rent but planning to buy 2 flats around 50 lacks each. I will stay in one and the second one will sell. Is this correct? 4. My current income is 2 lakh a month and I have kid only. Investments already in PPF monthly 10K, Sukanya Yojna monthly 20K rest expenses 60K monthly. I am a 44 year old married. My Goal is to have: 25 Lakhs for Education in next 7 yrs and Retirement income 1Lakh a month.

Ans: Hello;

1. You have 2 options of long term capital gain tax working because you have old land.
a.200-1=199 Lakhs on this a tax of 12.5% i.e.24.875 Lakhs
b.200-x=xyz Lakhs on this a tax of 20%
Where "x" is the inflation indexed cost of acquisition
You may consult a CA for calculating "x" for you and also recommending ways in which you can avoid payment of this tax based on provisions of income tax act.

If you can save on entire tax payment by reinvesting the capital gain from land sale into real estate then it makes sense to invest in real estate. You may rent out part of your real estate to earn rental income.

You may do a monthly sip of `90 K in an equity savings type mutual fund with low to moderate risk for 7 years.

It may grow into a sum of 1 Cr after 7 years assuming modest return of 9%. It may be utilised to fund higher education of your kid and partially funding your retirement income in addition to rental income.

Best Wishes;
X: @mars_invest

Ans: You have clearly outlined your financial position, goals, and decisions you are considering. It shows thoughtful planning and awareness about your future needs.

You have accumulated a solid financial base with multiple income-producing assets and long-term investments.

Now, let’s assess your situation from all angles and provide detailed suggestions for your post-retirement and daughter’s education planning.

Real Estate Decision – Flat or Plot?
You are considering a 2 BHK flat in Mumbai or Pune for Rs. 85 lakhs.

Around 70% of this cost would be through a home loan.

Alternatively, you are considering a 2000 sq.ft plot in Nagpur for Rs. 40 lakhs.

You already own two flats – one in Mumbai and one in Nagpur.

One of them is debt-free. The other has an EMI of Rs. 20,000 per month.

Adding a third property with a high loan burden may not be ideal.

Real estate is illiquid. It takes time to sell when needed.

Rental income is usually low in proportion to property cost.

Maintenance, taxes, legal costs, and vacancy risks reduce actual returns.

Real estate requires time, management, and ongoing financial attention.

Holding too much of your net worth in property creates concentration risk.

In your case, more real estate investment is not recommended.

You already have sufficient exposure through two flats.

Inflation in Property: Flat vs Plot
Over the next 10 years, inflation in property can vary across cities.

Flat prices usually grow at 5% to 7% per year.

But this is before deducting maintenance, property tax, and loan interest.

Plot prices may grow better in tier 2 cities like Nagpur.

Plot returns depend on location, infrastructure, and demand growth.

Historically, land appreciates better but does not generate any cash flow.

Flat gives rental income but has lower appreciation due to depreciation.

In the next decade, even 6%-8% annual growth will be considered decent.

So, neither flat nor plot is a guaranteed high-return asset.

That’s why mutual funds with flexibility and compounding are better long term.

Thinking of Shifting to Nagpur After Retirement?
You are thinking of settling in Nagpur post-retirement.

That is a clear and positive plan.

In this case, it’s not urgent to buy a plot right now.

You can wait and assess the locality and infrastructure after a few years.

Plot can be purchased 3 to 5 years before you need to build.

This gives you better clarity of available choices and better prices.

You also avoid keeping funds blocked in an idle land.

That money can work better for you in mutual funds and long-term growth options.

Later, you can buy a plot with maturity money from mutual funds, LIC, or FDs.

So, there is no need to rush into plot purchase today.

Should You Invest Rs. 40 to 85 Lakhs in Real Estate Now?
No, that may not be the most optimal decision.

Instead of investing in a third property, consider diversifying.

Real estate makes sense only when there is long-term use or rental value.

Mutual funds offer better liquidity, flexibility, and compounding benefits.

At 49, it’s time to make wealth work efficiently, not just grow size.

You can earn higher real returns through well-selected equity mutual funds.

Mutual funds also give you the option to withdraw as per need.

Property cannot be partially sold or withdrawn when needed.

Focus on financial assets that align with future expenses and goals.

Assessment of Current Investment Position
Monthly SIP of Rs. 25,000 is a strong and consistent investment habit.

Your mutual fund portfolio is around Rs. 20 lakhs. That is a good base.

Equity long-term capital gains are well-positioned for goal-based compounding.

PPF corpus of Rs. 6 lakhs adds safety and tax-free return.

LIC premiums of Rs. 2.22 lakhs per year need closer review.

Maturity value is around Rs. 50 to 60 lakhs across different policies.

Life risk cover of Rs. 80 lakhs is there. That offers some protection.

You also have Rs. 25 lakhs in FDs for immediate use.

Mediclaim cover of Rs. 25 lakhs is very good. It gives peace of mind.

All in all, your foundation is stable. But it can be sharpened.

What to Do With LIC Policies?
Review each LIC policy individually.

Check surrender value and maturity benefit vs premium paid.

If returns are below 5% annually, they are destroying your wealth.

Traditional insurance gives very low returns due to high costs.

Surrender poor-performing LIC policies and reinvest in mutual funds.

Use the maturity of good policies to support post-retirement needs.

Avoid mixing insurance and investment in future. Keep them separate.

Buy pure term cover for protection. Use mutual funds for investing.

This brings clarity, better returns, and tax-efficiency.

Planning for Daughter’s Education
Your daughter is 5 years old. Higher education will begin in 12 years.

That gives you a good time horizon to build a separate corpus.

Open a child goal SIP in a multi cap or balanced advantage fund.

Start investing minimum Rs. 10,000 per month towards this goal.

Step it up by 10% every year to match your income growth.

Keep this SIP separate from your retirement portfolio.

Do not mix children’s education fund with any other goal.

Track this goal using a calculator and review yearly.

Use long-term capital gains above Rs. 1.25 lakh judiciously as per new tax rules.

Enhancing Your Post-Retirement Plan
Post-retirement income should come from a mix of safe and growth assets.

Mutual funds in SWP mode give flexibility and steady income.

FD can be kept for 3 to 4 years of expenses for safety.

PPF maturity, LIC maturity, and NPS maturity should be staggered.

SIPs should be continued till age 60 and even beyond if possible.

Avoid holding excessive FD and real estate beyond 60 years.

Build at least Rs. 2 crores retirement corpus by age 60.

For that, continue SIPs with 10% step-up, focus on equity and hybrid funds.

Reduce property burden. Avoid taking large new loans now.

Invest more in mutual funds with the Rs. 25 lakh FD amount.

That will compound better and give you flexibility later.

Reallocate idle LIC premiums to higher-return options gradually.

Additional Suggestions
Do not invest in direct equity unless you can track daily.

Equity investing requires deep research, risk handling, and continuous tracking.

Instead, choose regular mutual fund plans with help of CFP.

Regular plans provide advisory, behavioural guidance, and rebalancing support.

Direct plans do not give any handholding or personalised planning.

Retirement, education, and healthcare goals need guided planning.

Avoid index funds. They lack downside protection and are rigid.

Actively managed funds perform better with fund manager strategies.

You can opt for balanced advantage funds in later years for stability.

Track inflation at 6% average for expenses. Use 8% return expectation for planning.

Do not overspend or overcommit in large-ticket assets now.

Finally
You are financially disciplined and forward-thinking. That is a strong quality.

Avoid new flat or plot now. Real estate already has high exposure in your portfolio.

Mutual funds will give you better returns, liquidity, and peace of mind.

Start separate SIPs for your daughter’s education. Keep it focused and growing.

Revisit all LIC policies. Exit low-return ones and shift to equity funds.

Invest your Rs. 25 lakhs FD in staggered manner into quality mutual funds.

Don’t increase loan burden. At age 49, focus on building financial flexibility.

Balance growth with safety. Mix equity, hybrid, and debt in right proportion.

With 10 years to retirement, create a clear retirement income strategy.

Continue protection with term cover and mediclaim. Those are non-negotiable.

Track goals yearly. Seek help from a Certified Financial Planner for a personalised plan.

The key to retirement success is goal-based investing, not asset hoarding.

Your wealth must support your dreams and responsibilities with ease.

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

Ans: You have explained your income, goals, current assets, and future plans with great clarity. Your early planning spirit is strong. This gives a very good base. You can reach a peaceful retirement with smart steps in the next few years.

» Your Current Position

You are 40 years old. You plan to retire in 3 to 5 years. You earn Rs 2.3 lakh per month. Your wife also works but will stop working soon. You have one daughter aged 10. Your current monthly cost is around Rs 1.1 lakh. This cost will reduce after retirement because you will shift to your parental flat.

Your investment base is already good. You have saved in bonds, stocks, mutual funds, PPF, FD, and SIP. Your wife also has her own savings and rental income from a flat. All these create a good starting point.

This early base helps you plan stronger. It also gives room for more shaping. You are on the right road.

» Your Family Goals

You need Rs 75 lakh for your daughter’s higher education and marriage.

You want Rs 75,000 per month for family living after retirement.

You want to retire in 3 to 5 years.

You will shift to your parental flat after retirement.

You will have rental income of Rs 10,000 from your wife’s flat.

These goals are clear. They give direction. They allow a strong plan.

» Your Present Investments

Your investments include:

Rs 50 lakh in REC bonds maturing in 2029.

Rs 42 lakh in stocks.

Rs 17 lakh in mutual funds.

Rs 16 lakh in fixed deposits.

Rs 15 lakh in PPF.

Rs 1.3 lakh as monthly SIP.

Your wife holds:

Rs 30 lakh corpus.

A flat worth Rs 40 lakh with rent of Rs 10,000 each month.

Your combined net worth is healthy. This gives good power to build your retirement fund in the coming years.

» Understanding Your Expense Need After Retirement

You expect Rs 75,000 per month after retirement. This includes all basic needs. You will not have rent. That reduces cost. This assumption looks fair today.

Your cost will rise with inflation. So you must plan for rising needs. A strong retirement corpus must support rising cost for 40 to 45 years because you are retiring early.

An early retirement needs a large buffer. So you need safety along with growth. Your plan must include growth assets and safety assets.

» How Much Monthly Income You Will Need Later

Rs 75,000 per month is Rs 9 lakh per year. In future years, this cost can rise. If we assume steady rise, your future cost will be much higher.

So the retirement corpus must be designed to:

Give monthly income.

Beat inflation.

Support you for 40 to 45 years.

Protect your family even in market down cycles.

Allow flexibility if your needs change.

A strong retirement fund must support both safety and long-term growth.

» How Much Corpus You Should Target

A safe target is a large and flexible corpus that can support long years without running out of money. For early retirement, the usual thumb rule suggests a very high number. This is because you need income for many decades.

You need a corpus big enough to produce rising income. You also need a cushion for unexpected health costs, lifestyle shocks, and inflation changes.

Your target retirement corpus should be in a strong range. For your needs of Rs 75,000 per month and for goals like daughter’s education and marriage, you should aim for a combined retirement readiness corpus in the higher bracket.

A safe range for your family would be a very large number crossing multiple crores. This large range gives you:

Income safety.

Inflation protection.

Peace during market cycles.

Comfort in long life.

Room for daughter’s future.

Strong backup for health.

You are already on the way due to your existing assets. You will reach close to this range with systematic building over the next 3 to 5 years.

» Why You Need This Larger Corpus

You will retire early. That means more years of living from your corpus. Your corpus must not fall early. It must grow even after retirement. It must give monthly income and long-term family protection.

This is only possible when the corpus is strong and well-structured. A weak corpus creates stress. A strong corpus creates freedom.

Also, your daughter’s future cost must be kept aside. This must be parked in a separate fund. This must not touch your retirement money.

A strong corpus makes these two worlds separate and safe.

» Your Existing Assets and Their Strength

You already have good diversification:

Bonds give safety.

Stocks give growth.

Mutual funds give managed growth.

FD gives stability.

PPF gives tax-free long-term savings.

This blend is already a good start. But you need to make the blend more structured for early retirement.

Your Rs 1.3 lakh monthly SIP is also strong. It builds your future fast. You should continue.

Your wife’s rental income is small but steady. This adds strength.

Your combined financial base can reach your retirement target if you refine your allocation now.

» Your Daughter’s Future Fund Need

You need Rs 75 lakh for your daughter’s education and marriage. You should keep this goal separate from your retirement goal.

Your current SIP and future allocations should create a dedicated fund for this goal. A long-term fund can grow well when managed actively.

Do not mix this fund with your retirement needs. Mixing leads to shortage in old age. Always keep this corpus ring-fenced.

» A Strong Asset Mix For Your Retirement Path

A balanced mix is needed. You need growth assets to beat inflation. You also need stable assets for income.

You must avoid index funds because they do not give flexibility. Index funds follow a fixed index. They cannot make active changes in different markets. They cannot move to better stocks when markets change. They force you to stay in weak sectors for long. They also do not help you in down cycles because they cannot protect you by shifting to safer options. This can hurt retirement planning.

Actively managed funds are better because:

They give active asset selection.

They give scope for better returns.

They give flexibility to change sectors.

They give downside management.

They give access to a skilled fund manager.

They support long-term planning more safely.

Direct plans also carry risk. Direct plans do not give guidance. They do not give behavioural support. They do not give market timing help. They do not give portfolio shaping. They leave all the judgement to you. One mistake can cost years of wealth.

Regular plans with guidance from a Certified Financial Planner help you shape decisions. They help you remain disciplined. They help you avoid panic. They help you decide allocation changes at the right time. This saves wealth in long-term.

» How Your Investment Journey Should Grow in the Next 3–5 Years

Continue your SIP.

Increase SIP when your income rises.

Shift part of your stock holding into planned long-term mutual funds to reduce concentration risk.

Build a defined daughter’s education fund.

Keep a part of your REC bond maturity amount for long-term.

Avoid locking too much into fixed deposits for long periods.

Build a safety fund for one year of expenses.

This will create a full structure.

» Your Rental Income Role

Your rental income of Rs 10,000 per month is small but steady. Over time it will rise. This income will support your monthly cash flow after retirement.

You can use this for utilities or health insurance premiums. This gives a cushion.

» Your Emergency Buffer

You should keep at least one year of essential cost in a safe place. This can be in a liquid account or short-term fund. This protects you in shocks.

Since you plan early retirement, a strong buffer is important. It gives peace even in low months.

» A Structured Retirement Approach

A complete retirement plan for you should include:

A clear monthly income plan after retirement.

A corpus that can grow and protect.

A rising income system that matches inflation.

A separate daughter’s future fund.

A health cover plan for your family.

A tax-efficient withdrawal plan.

A market cycle plan to protect you in tough times.

This holistic approach keeps your family strong for decades.

» What You Should Build by Retirement Year

Your aim should be to reach a strong multi-crore range in investments before retirement. You already hold a large amount. You will add more in the next 3 to 5 years through SIP, stock growth, bond maturity, and disciplined saving.

Once you reach your target range, you can start the shifting process:

Move a part to stable assets.

Keep a part in long-term growth assets.

Create a monthly income strategy.

Keep a reserve bucket.

Keep a child future bucket.

Keep a long-term growth bucket.

This structure protects you in all market conditions.

» Final Insights

Your financial journey is already strong. You have a good income. You have saved well. You have multiple asset types. You have a clear timeline. And you have clear goals. This foundation is solid.

In the next 3 to 5 years, your focus should be on growing your combined corpus to a strong multi-crore range, keeping a separate fund for your daughter, reducing risk in unplanned assets, and building a stable long-term structure.

With the present path and a disciplined structure, you can retire peacefully and support your family with confidence for many decades.

Best Regards,

K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

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