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Ramalingam

Ramalingam Kalirajan  |6995 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 18, 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 - Aug 19, 2023Hindi
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How much health insurance is required actually for family of 3 at age of 57,51,20 respectively

Ans: For a family of three with ages 57, 51, and 20, the health insurance requirement depends on several factors like current health status, medical history, lifestyle, and location. Here's a general guideline:

Medical Inflation: Medical costs tend to rise with inflation. Consider the average annual medical inflation rate (around 10-15%) to estimate future medical expenses.
Healthcare Needs: Assess the healthcare needs based on family history, lifestyle, and any existing health conditions. Older individuals may require more frequent medical care and treatments.
Coverage Amount: A minimum coverage of Rs 5-10 lakhs for the younger member and Rs 10-15 lakhs for the older members is recommended.
Family Floater vs Individual Policies: A family floater policy can provide coverage for all family members under a single sum insured, whereas individual policies offer separate coverage for each member.
Considering the above factors, a health insurance coverage of Rs 15-25 lakhs for the family would be a reasonable starting point. However, it's essential to reassess your coverage needs periodically and adjust the coverage amount accordingly. Consulting with a Certified Financial Planner or insurance advisor can help determine the appropriate coverage amount based on your specific needs and circumstances.
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  |6995 Answers  |Ask -

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

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I am 62 years retired. My wife 56 years daughter 25 son 20... We don't have any health insurance pl suggest a health insurance
Ans: Choosing the right health insurance for your family is a crucial decision. I understand that this process can be overwhelming, especially with the numerous options available in the market. Let’s explore this step-by-step to ensure that you select the best health insurance plan tailored to your family’s needs.

Understanding Health Insurance
Health insurance is essential to safeguard against unexpected medical expenses. It covers hospitalization, treatments, surgeries, and sometimes even preventive care.

Having health insurance gives you peace of mind, knowing that you won't have to bear the entire financial burden in case of medical emergencies.

Assessing Your Family’s Health Needs
To choose the right health insurance, you need to assess the specific health needs of your family.

Consider Your Age and Health Status
At 62 years old, your health needs may be different from those of your wife, who is 56, and your children, who are 25 and 20 years old. Older individuals typically require more frequent medical attention and might have pre-existing conditions.

Pre-existing Conditions
If any family member has pre-existing conditions, ensure the policy covers these after a waiting period. This is crucial for avoiding out-of-pocket expenses.

Coverage for Hospitalization and Surgeries
Ensure that the policy covers hospitalization and surgeries. Medical costs can be very high, and comprehensive coverage will protect you from significant financial strain.

Comparing Different Policies
When comparing health insurance policies, consider the following factors:

Sum Insured
Choose a sum insured that is sufficient to cover the potential medical expenses for the entire family. In metropolitan cities, medical costs can be higher, so opt for a higher sum insured if you reside in such areas.

Network Hospitals
Check if the insurance provider has a wide network of hospitals. Cashless hospitalization in network hospitals simplifies the process and reduces financial stress during emergencies.

Sub-limits and Co-payments
Some policies have sub-limits on room rent or specific treatments and co-payment clauses. Understand these limitations to avoid unexpected expenses.

Waiting Periods
Understand the waiting periods for pre-existing diseases, maternity benefits, and other specific treatments. Shorter waiting periods are more advantageous.

Family Floater Plans vs. Individual Plans
A family floater plan covers all family members under a single sum insured, while individual plans provide separate coverage for each member.

Family Floater Plans
Family floater plans are usually more cost-effective and simpler to manage. The sum insured is shared among all members, which is beneficial if no major health issues are anticipated simultaneously.

Individual Plans
Individual plans can be more suitable if family members have varying health needs or if older members need higher coverage. Separate policies ensure that one member’s high medical expenses do not exhaust the entire sum insured.

Critical Illness Coverage
Consider adding critical illness coverage to your health insurance. This provides a lump sum payment upon diagnosis of severe illnesses such as cancer, heart attack, or stroke.

Maternity Benefits and Newborn Coverage
If there’s a possibility of expanding your family, check if the policy includes maternity benefits and coverage for newborns.

Premiums and Affordability
While choosing a policy, balance between comprehensive coverage and affordability. Higher premiums usually mean better coverage, but ensure it fits within your budget.

Additional Benefits and Riders
Explore additional benefits like wellness programs, free health check-ups, and disease-specific riders. These add value to your policy.

Evaluating Insurance Providers
Choosing a reliable insurance provider is as important as selecting the right policy.

Claim Settlement Ratio
The claim settlement ratio indicates the percentage of claims settled by the insurer. A higher ratio reflects reliability.

Customer Service
Evaluate the insurer’s customer service. Prompt and efficient service is crucial during medical emergencies.

Reviews and Recommendations
Read reviews and seek recommendations from friends, family, or a Certified Financial Planner to make an informed decision.

Portability Options
If you’re not satisfied with your current insurance provider, check the portability options. This allows you to switch insurers without losing benefits.

Government Schemes and Tax Benefits
Explore government health schemes for additional coverage. Also, health insurance premiums offer tax benefits under Section 80D of the Income Tax Act.

Conclusion
Choosing the right health insurance involves thorough research and understanding your family’s specific needs. Consider the factors mentioned above to make an informed decision.

Remember, investing time in selecting the right policy can save you from financial stress during medical emergencies.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |6995 Answers  |Ask -

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

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I am 51yr old dr and have a monthly income of approximately 3lakh and have 2kids want to have 3cr for their marriage and 2cr for their education one is 17 and one is 13 and 5 cr for our retirement how much monthly premium should be paid
Ans: Securing Your Family's Future: A Doctor's Guide to Financial Planning
I understand you're a 51-year-old doctor with a monthly income of Rs. 3 lakh and two wonderful children (aged 17 and 13). You're aiming to accumulate a significant corpus for their education (Rs. 2 crore each) and marriage (Rs. 3 crore each), along with Rs. 5 crore for your retirement. That's a fantastic goal, and with careful planning, it's achievable!

Here's a breakdown to help you navigate this financial journey:

Understanding Your Goals:

Education & Marriage: Your children's education needs will come first (13 and 17 years old). Then, there are the marriage expenses in a few years.

Retirement: You have around 10 years until retirement (considering the average retirement age for doctors in India). Planning for a comfortable retirement income is crucial.

The Power of Time:

The good news is you have time on your side! The earlier you start investing, the more time your money has to grow through compounding (earning interest on your interest).

Let's Talk Numbers:

While I can't give you an exact monthly investment amount without a detailed financial assessment, here's a framework to consider:

Corpus Needed: Add up your goals: Rs. 2 crore (Child 1 Edu) + Rs. 2 crore (Child 2 Edu) + Rs. 3 crore (Child 1 Marriage) + Rs. 3 crore (Child 2 Marriage) + Rs. 5 crore (Retirement) = Rs. 15 crore.

Investment Time Horizon:

Education (13-year-old): 5 years (assumed graduation age)
Education (17-year-old): 1 year (assumed graduation age)
Marriage (both): Let's assume 10 years for each child (considering potential higher education and career establishment before marriage).
Retirement: 10 years (assuming retirement at 60).
Investing for Different Time Horizons:

Based on the time horizon, we can explore different investment options:

Child's Education (Short Term):

Aggressive Balanced Actively Managed Funds: These offer a mix of equity and debt, with a potential for higher growth than pure debt options but with some risk.
Child's Marriage (Mid Term):

Balanced Actively Managed Funds: These offer a balance between growth and stability, suitable for mid-term goals.
Retirement (Long Term):

Multi-Cap Actively Managed Funds: Invest across large, mid, and small-cap companies, offering diversification and growth potential for the long term.
Remember: Actively managed funds have the potential for higher returns than passively managed options like index funds, but they also carry more risk.

How Much to Invest?

Several factors influence your investment amount:

Current Savings & Expenses: Analyze your monthly income, expenses, and existing savings.

Risk Tolerance: How comfortable are you with potential market fluctuations? Higher risk tolerance allows for potentially higher returns.

A CFP Can Help:

A Certified Financial Planner (CFP) can create a personalized plan considering all these factors. They can:

Calculate Investment Amount: Using financial tools and considering your goals and risk tolerance, a CFP can recommend a suitable monthly investment amount.

Factor in Inflation: Inflation erodes the purchasing power of money. A CFP will factor in inflation to ensure your goals are met despite rising costs.

Review and Rebalance: Your financial situation and goals might change over time. A CFP will monitor your progress and adjust your investment plan as needed.

Beyond Monthly Investments:

Here are some additional strategies to consider:

Utilize Employer Benefits: Explore tax-saving investment options offered by your employer (if applicable).

Review Existing Investments: If you have any existing investments, a CFP can assess their suitability for your goals.

Remember, this is a general overview. Consulting a CFP is crucial to create a tailor-made plan that considers your specific financial situation and risk tolerance.

Taking Charge of Your Future:

You've taken a great first step by planning for your family's future. By starting early, investing wisely, and seeking professional guidance, you can achieve your financial goals and secure a bright future for yourself and your loved ones.

Don't hesitate to take action! Schedule a consultation with a CFP to get started on your financial planning journey.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |6995 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 24, 2024

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What should be an ideal medical insurance sum assured for a family of 4 Husband : 44yrs, wife : 40 yrs, Two kids: 12 & 4 yrs to have a safe amount post retirement
Ans: 1. Assessing Medical Insurance Needs:

Family Health Risks:

Consider the health risks and history of each family member. Health insurance should cover possible medical expenses, including hospitalization, treatments, and emergencies.
Future Medical Costs:

Medical costs tend to rise over time due to inflation. Estimate future medical expenses by considering the current average costs and projected inflation rates.
2. Determining Sum Assured:

Current Coverage:

For a family with members aged 44, 40, 12, and 4 years, a basic coverage amount might not suffice. Higher coverage is advisable to avoid underinsurance.
Sum Assured Recommendation:

Minimum Coverage:

A sum assured of Rs. 10 lakhs to Rs. 15 lakhs per family member is typically recommended. This amount should cover a wide range of medical expenses and treatments.
Optimal Coverage:

For better security, consider a sum assured of Rs. 20 lakhs to Rs. 30 lakhs for the entire family. This amount can offer more comprehensive coverage and protect against high medical costs in the future.
3. Additional Considerations:

Inflation Protection:

Opt for policies with inflation protection features that increase the sum assured over time to keep up with rising medical costs.
Comprehensive Coverage:

Ensure the policy covers a wide range of medical conditions, including critical illnesses, pre-existing conditions, and maternity benefits if applicable.
Cashless Facility:

Choose a plan with a broad network of hospitals that offer cashless treatment, reducing out-of-pocket expenses during medical emergencies.
Policy Features:

Look for features like no claim bonus, annual health check-ups, and coverage for preventive care.
4. Reviewing and Updating Coverage:

Regular Review:

Review the insurance policy annually or after major life events (e.g., children growing up or significant health changes) to ensure it meets the evolving needs of your family.
Consult a Professional:

Consult a Certified Financial Planner to evaluate your specific needs and recommend the most suitable sum assured based on your family's health profile and financial situation.
Final Insights

An ideal medical insurance sum assured for a family of four, consisting of a 44-year-old husband, a 40-year-old wife, and two children (12 and 4 years), should ideally range from Rs. 20 lakhs to Rs. 30 lakhs. This amount provides adequate coverage for potential future medical expenses and ensures financial safety post-retirement. Always consider future medical inflation, policy features, and consult with a Certified Financial Planner for tailored advice.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

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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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