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How to Invest 60 Lakhs at 40 for My Daughter's Education, Foreign Trips, and Retirement?

Milind

Milind Vadjikar  |776 Answers  |Ask -

Insurance, Stocks, MF, PF Expert - Answered on Oct 15, 2024

Milind Vadjikar is an independent MF distributor registered with Association of Mutual Funds in India (AMFI) and a retirement financial planning advisor registered with Pension Fund Regulatory and Development Authority (PFRDA).
He has a mechanical engineering degree from Government Engineering College, Sambhajinagar, and an MBA in international business from the Symbiosis Institute of Business Management, Pune.
With over 16 years of experience in stock investments, and over six year experience in investment guidance and support, he believes that balanced asset allocation and goal-focused disciplined investing is the key to achieving investor goals.... more
Asked by Anonymous - Oct 12, 2024Hindi
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Hello team, I am 40 years old and retired. I have 60 lakhs in hand (to be invested) with 5.60 lakh invested in diversified mutual funds, 2 lakhs in fixed deposit, 2.22 lakh in Sukanya (SSA). Will be drawing a pension of 30K/month. I don’t have any liabilities of home loan and car loan which I have already settled. Please advise me to invest my 60 Lakh for my future. I have a single child and she is studying in 10 grades. (a) Short term goal (for 1/2/3 years) - My daughter education yearly fees of 1.5 lakh - Foreign trips alternate year costing around 1.5 lakh - Monthly income of 20 K (b) Long term goal (in 10/15/20 years) - Daughter education (graduation/Post graduation) - Daughter marriage - Corpus of 1 Crore and above Your suggestions on Life term insurance and health insurance will be appreciated. I have central government health insurance still wand to take up a private health insurance for better treatment.

Ans: Hello;

For goal under heading "a", I recommend you the following;

1. Invest 10 L in Arbitrage type of mutual fund (low risk) for the education funding requirement of your daughter.

2. Buy an immediate annuity for 40 L from a life insurance company which may yield you a monthly income of 20 K as desired. 6 % annuity rate considered.

3. Invest MF corpus(5.6 L) and FD sum(2 L) into an equity savings type mutual fund (low to moderate risk)
This will help fund your international vacations. Value 9.84 L in 3 years considering 9 % returns.

For achievement of goal under heading "b" invest 10 L lumpsum in a pure equity mutual fund for 20 years after which it will provide you a sum of 1.15 Cr. Top-up this investment as and when possible to prepone your target achievement in 15 or 12 years.(13% return considered)


You should have adequate term life cover atleast upto 60 years of age (Check for postal life insurance at your nearest post office if you want to buy) with suitable riders and also health care cover(HDFC ergo and Niva Bupa are good)despite CGHS.

Happy Investing!!

*Investments in mutual funds are subject to market risks. Please read all scheme related documents carefully before investing.
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 - Dec 18, 2023Hindi
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I have two daughters and their age is 16 and 15 and i own 50 lakhs bank FD , 9 lakhs invested in MF me and my wife have invest 60 lakhs in share market and my age 51 year old. Can you plz suggest the best option for investment . for my future education of two kids and my and my wife upcoming old age( My family ) i have 3 lakhs mediclaim and have few LIC policies. I request you to give me the best advice or suggest the best investment for my growth of money and as a monthly income ( Home expenses ) plz reply
Ans: Given your family's financial situation and goals, it's crucial to create a comprehensive investment plan that considers both growth and stability. Here's a suggested approach:

Education Fund for Daughters: Since your daughters are nearing college age, consider setting aside a portion of your investments specifically for their education expenses. You may allocate a portion of your bank FDs and MF investments towards this goal, ensuring it grows over time to meet their educational needs.
Retirement Planning: As you and your wife approach retirement, it's essential to prioritize building a sufficient corpus to support your lifestyle in old age. Consider diversifying your investment portfolio to include a mix of equity, debt, and balanced funds, along with retirement-focused instruments like the National Pension System (NPS) or Senior Citizen Savings Scheme (SCSS).
Health and Insurance: Ensure you have adequate health insurance coverage for your family's medical needs. Additionally, review your existing LIC policies to ensure they align with your current financial goals and provide adequate coverage for your family's future needs.
Monthly Income: To generate regular income for your household expenses during retirement, consider investing in dividend-paying stocks, mutual funds with dividend options, or fixed income instruments like Senior Citizen Savings Scheme (SCSS) or Post Office Monthly Income Scheme (POMIS).
Regular Review and Adjustment: Regularly review your investment portfolio to track its performance, make necessary adjustments, and ensure it remains aligned with your financial goals and risk tolerance.
Consulting with a Certified Financial Planner can provide personalized guidance tailored to your family's specific financial situation and goals. Together, you can create a customized investment plan that addresses your needs for growth, income, and financial security.

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Mutual Funds, Financial Planning Expert - Answered on May 06, 2024

Asked by Anonymous - Apr 26, 2024Hindi
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Hello Sir ,I am 50 years old and a government servant in Rajasthan having served the department for 21 years now with 12 years of service still remaining . I own a house which is almost debt free, have invested in sip’s ,which are small amount but in different funds which includes SBI blue chip,nippon ,quant small cap fund ,Parag Parikh flexicap .I have one daughter and my wife is also a government teacher.We both would get around one crore each when we retire . My objective now is my daughter’s education,her marriage and post retirement a better life economically. I have family health insurance also despite government providing us with a free of cost health services.In which funds , for long and short term,I should invest to fulfill my future requirements.My job is pensionable.
Ans: It's commendable that you're thinking ahead and planning for your family's future. Here are some tailored suggestions for your financial goals:

For Daughter's Education:
Short-Term (0-5 Years): Consider investing in debt mutual funds or fixed deposits to ensure capital preservation for your daughter's near-term education expenses.
Long-Term (5+ Years): Since your daughter's education is a long-term goal, you can invest in a mix of equity mutual funds with a focus on growth. Look for diversified funds that offer exposure to large-cap, mid-cap, and flexi-cap segments.
For Daughter's Marriage:
Medium to Long-Term (5-15 Years): To accumulate funds for your daughter's marriage, you can allocate a portion of your investments to equity mutual funds with a longer investment horizon. Opt for a combination of large-cap and flexi-cap funds for stability and growth potential.
For Retirement:
Long-Term (12+ Years): As you have a pensionable job, your retirement corpus can supplement your pension income. Invest in a diversified portfolio of equity mutual funds along with a portion allocated to debt funds for stability. Aim for a balanced approach that accounts for both growth and capital preservation.
Fund Selection:
Equity Funds: Look for well-established funds with a consistent track record of performance and a focus on long-term wealth creation. Consider funds with a proven investment strategy and experienced fund managers.
Debt Funds: Choose debt funds that offer a blend of safety and returns suitable for your short-term goals. Opt for funds with a low credit risk and a moderate duration profile.
Balanced Funds: Consider allocating a portion of your investments to balanced funds, which offer a mix of equity and debt exposure. These funds provide diversification and stability to your portfolio.
Risk Management:
Review Regularly: Periodically review your investment portfolio to ensure it remains aligned with your financial goals and risk tolerance. Make adjustments as needed based on changes in your circumstances or market conditions.
Stay Informed: Stay updated on market trends, economic developments, and investment opportunities. Knowledge empowers you to make informed decisions and navigate financial markets effectively.
Consultation:
Seek Professional Advice: Consider consulting with a certified financial planner to develop a personalized financial plan tailored to your specific needs and objectives. A professional advisor can provide valuable insights and guidance to help you achieve your financial goals effectively.
By following these recommendations and staying disciplined in your investment approach, you can work towards securing a bright and financially stable future for yourself and your family.

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Moneywize

Moneywize   |174 Answers  |Ask -

Financial Planner - Answered on Aug 13, 2024

Asked by Anonymous - Aug 08, 2024Hindi
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My wife and I earn Rs 2.9 lakh per month. We have two daughters: 8 and 5. Our monthly expenses are around 120K. We have home loan of 50 lakh with 50k EMI for 10 years. We will need Rs 40 lakh for our new property in one year period. We have Rs 80 lakh worth apartment, Rs 20 lakh in PPF, Rs 35 lakh in PF, Rs 10 lakh in NPS, Rs 20 lakh in MFs, Rs 20 lakh in stocks and Rs 20 lakh in ULIPs. We have monthly MF SIPs of 80K and 40K pm and also have our individual as well as family floater health insurances and term insurance. We are expecting around Rs 2 cr expenses for children education till their graduation. We want to retire in next 15 years with Rs 3 lakh monthly income. How should we invest and plan for our future?
Ans: To plan for your future and ensure you’re on track to meet your goals, here’s a strategy that might work well for you:

1. Emergency Fund

First, it’s a good idea to set aside 6-12 months of your expenses (around Rs 7.2 lakh to Rs 14.4 lakh) in something easily accessible, like a savings account or a liquid mutual fund. This way, you’ll have a safety net in case anything unexpected comes up, and you won’t have to dip into your other investments.

2. Debt Management

Home Loan: Keep up with your current EMI of Rs 50,000. Since it’s spread over 10 years, it’s manageable given your income. If you find yourself with some extra cash, consider making lump sum prepayments to shorten the loan period and reduce the interest you’ll pay in the long run.

3. Funding the New Property

You’ll need Rs 40 lakh in a year for your new property. It might be wise to start planning how to use your liquid investments, like mutual funds and stocks, for this purpose. If the market conditions are favourable, you can gradually redeem the required amount to avoid the risks associated with market timing. It’s best to avoid taking on new debt if possible, to keep your finances balanced.

4. Children's Education

You’re looking at about Rs 2 crore for your daughters’ education, and you’ve got a 10-12 year window to prepare.
Dedicated Education Fund: It’s worth starting a specific SIP in equity mutual funds with a long-term horizon. With the power of compounding on your side, you can either reallocate some of your existing SIPs or start new ones to build up this fund steadily. Also, consider Sukanya Samriddhi Yojana (SSY) for each daughter -- it offers a good interest rate and comes with tax benefits.

5. Retirement Planning

You’d like to retire in 15 years with Rs 3 lakh coming in every month. Accounting for inflation, you’re looking at needing a corpus of around Rs 7-8 crore.

• Current Retirement Savings: You already have Rs 85 lakh (from your PPF, PF, and NPS), which will grow over time, but you’ll need to invest more to hit your target.
• Invest Aggressively: Continue with your existing SIPs and think about increasing them each year as your income grows. Ideally, try to invest 30-40 per cent of your monthly income towards retirement.
• Equity Exposure: With your long-term horizon, keeping a high equity exposure (around 70-80 per cent) in your retirement portfolio could help maximise growth.
• NPS Contributions: You might also want to increase your contributions to the NPS for an additional tax-efficient retirement nest egg.

6. Insurance

Make sure your term insurance is enough to cover at least 10-15 times your annual income, which will help secure your family’s future in case anything happens to you. You’ve already got health insurance, which is great -- just review it to ensure it’ll be enough to cover rising medical costs in the future.

7. Tax Efficiency

Use all the tax-saving instruments available to you, like Section 80C, 80D, and 80CCD(1B), to minimise your tax liabilities. Also, consider diversifying your investments into tax-efficient options like ELSS, PPF, and NPS.

8. Review and Adjust

Finally, it’s important to regularly check in on your financial plan, at least once a year, to make sure you’re still on track. If your income, expenses, or goals change, you’ll need to adjust your investments accordingly.

By following this plan, you should be well on your way to achieving your financial goals, securing your children’s education, and retiring comfortably with the income you desire.

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Milind

Milind Vadjikar  |776 Answers  |Ask -

Insurance, Stocks, MF, PF Expert - Answered on Oct 15, 2024

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Hello team, I am 40 years old and retired. I have 60 lakhs in hand (to be invested) with 5.60 lakh invested in diversified mutual funds, 2 lakhs in fixed deposit, 2.22 lakh in Sukanya (SSA). Will be drawing a pension of 30K/month. I don’t have any liabilities of home loan and car loan which I have already settled. Please advise me to invest my 60 Lakh for my future. I have a single child and she is studying in 10 grades. (a) Short term goal (for 1/2/3 years) - My daughter education yearly fees of 1.5 lakh - Foreign trips alternate year costing around 1.5 lakh - Monthly income of 20 K (b) Long term goal (in 10/15/20 years) - Daughter education (graduation/Post graduation) - Daughter marriage - Corpus of 1 Crore and above Your suggestions on Life term insurance and health insurance will be appreciated. I have central government health insurance still wanted to take up a private health insurance for better treatment.
Ans: Hello;

For goal under heading "a", I recommend you the following;

1. Invest 10 L in Arbitrage type of mutual fund (low risk) for the education funding requirement of your daughter.

2. Buy an immediate annuity for 40 L from a life insurance company which may yield you a monthly income of 20 K as desired. 6 % annuity rate considered.

3. Invest MF corpus(5.6 L) and FD sum(2 L) into an equity savings type mutual fund (low to moderate risk)
This will help fund your international vacations. Value 9.84 L in 3 years considering 9 % returns.

For achievement of goal under heading "b" invest 10 L lumpsum in a pure equity mutual fund for 20 years after which it will provide you a sum of 1.15 Cr. Top-up this investment as and when possible to prepone your target achievement in 15 or 12 years.(13% return considered)

You should have adequate term life cover atleast upto 60 years of age (Check for postal life insurance at your nearest post office if you want to buy) with suitable riders and also health care cover(HDFC ergo and Niva Bupa are good)despite CGHS.

Happy Investing!!

*Investments in mutual funds are subject to market risks. Please read all scheme related documents carefully before investing.

..Read more

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I am 37 year old Commerce Graduate. I was in an unorganized business, which cannot be pursued any farther. Will it be wise to do CPA at this age without formal experience in Accounting, for a decent job? Is there any other course to pursue?
Ans: Amit Sir, A CPA (Certified Public Accountant) at the age of 37 can be a viable option for those without formal accounting experience. The CPA is a globally recognized certification that can open doors to various roles in accounting, auditing, and finance. It provides a solid foundation and increases credibility in the finance or accounting industry. However, there are challenges, such as the learning curve and experience requirements.

To overcome these, you could supplement with basic accounting courses and work experience. Alternative courses you can consider include Chartered Financial Analyst (CFA), Financial Risk Management (FRM), Certified Management Accountant (CMA), Post Graduate Diploma in Management (PGDM) or MBA, and Digital Marketing or E-Commerce.

CFA and FRM are globally recognized credentials that can lead to roles in finance, investment banking, or wealth management. CMA professionals are in high demand in banks, investment firms, and large corporations. MBAs can help transition into management or higher-level positions, while digital marketing or e-commerce can offer opportunities for entrepreneurship and business growth.

Age should not be a barrier for you in pursuing any course or certification. Leveraging prior experience, such as management, customer relations, and strategic thinking, can also benefit a corporate role. In conclusion, pursuing a CPA at the age of 37 is a viable option, but preparation and experience are essential.

All the BEST for your Prosperous Future.

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sir i am commerce gratuate prepared 2 years for CA coul'd not succeed what are the diff career op for me
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My son is doing BBA( 1st year.) Which extra course help him future.
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Nayagam P

Nayagam P P  |3989 Answers  |Ask -

Career Counsellor - Answered on Dec 18, 2024

Asked by Anonymous - Nov 24, 2024Hindi
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My daughter studying bsc biotechnology 1st semester please suggest me about her future career
Ans: The decision by your daughter to pursue a BSc in Biotechnology opens up a wide range of career opportunities in diverse and rapidly growing fields. After completing her BSc, she can either pursue further education or enter the job market directly. Options include MSc in Biotechnology (or Related Fields), MBA in Biotechnology/Healthcare Management, PhD in Biotechnology, PG Diploma Courses, and pursuing a master's degree in top countries for biotechnology.

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All the BEST for your Daughter’s Prosperous Future.

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Nayagam P

Nayagam P P  |3989 Answers  |Ask -

Career Counsellor - Answered on Dec 18, 2024

Asked by Anonymous - Nov 23, 2024Hindi
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Confused about the future after doing bsc biotechnology. In which subject I should do msc ? Ok india or abroad? Which biotechnology sector have high paying jobs ?
Ans: Biotechnology is a promising field with numerous career paths. Choosing the right specialization and study destination depends on interests, career goals, and financial considerations. Some popular specializations include Biotechnology, Microbiology, Biochemistry, Bioinformatics, Food Technology, Environmental Biotechnology, Medical Biotechnology, Genetic Engineering, and Industrial Biotechnology. Studying in India offers affordable education, access to reputed institutions, and a growing biotech industry. Abroad offers exposure to advanced research and technologies, higher-paying jobs, and better industry connections. High-paying sectors in biotechnology include pharmaceuticals and biopharma, healthcare and diagnostics, bioinformatics, industrial biotechnology, agricultural biotechnology, and environmental biotechnology. High-paying countries for biotechnology careers include the USA, Germany, Canada, Singapore, and India.

For those looking for cutting-edge research and higher-paying jobs, consider studying abroad in countries like the USA, Germany, or Canada. For those preferring affordable education and a long-term plan to settle in India, pursue MSc in a specialized field from top Indian institutes. Opt for fields like Bioinformatics, Medical Biotechnology, or Industrial Biotechnology, which offer the best combination of high salaries and demand. All the BEST for your Prosperous Future.

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Nayagam P P  |3989 Answers  |Ask -

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Sir Greetings! is it true that now UGC wont differentiate rather treats equally both regular and correspondence degree or PG. Even correspondence students are eligible and apply for both govt and private sector jobs. I heard even companies need to accept correspondence degree done in India. Sir please clarify without any ambiguity in this regard. This is Q has been bothering me for quite sometime
Ans: Anirvinna, The University Grants Commission (UGC) and other regulatory bodies in India have made significant efforts to ensure that distance education degrees are treated as equivalent to regular degrees. The UGC states that degrees obtained through distance or online education from recognized institutions are equivalent to regular degrees, applicable for both government and private sector jobs. The Distance Education Bureau (DEB) ensures the quality of distance education programs and oversees compliance. Distance education degrees are valid for all government jobs, professional courses, and private sector acceptance. However, some organizations may prioritize candidates with regular degrees for certain roles due to perceptions of classroom rigor or networking opportunities. The UGC has encouraged universities to offer quality online programs, reducing the stigma associated with correspondence education. To enhance career prospects, consider pursuing correspondence programs from well-reputed institutions with strong alumni networks and industry connections. All the BEST for your Prosperous Future.

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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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