Home > Money > Question
Need Expert Advice?Our Gurus Can Help

How can I save 2 lakhs by year-end with a combined income of 82k?

Ramalingam

Ramalingam Kalirajan  |8013 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 16, 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 - Jun 26, 2024Hindi
Listen
Money

Husband earning 42k and me earning 40k per month. With no savings as of now. Started sukanya samriddhi plan with 7k per month 2 months back. Loan of 15k per month for me and husband 12k per month. Sips we have 5k and 2k monthly other than that no other savings plan as of now. PLS SUGGEST ways of savings by year end we need 2L.

Ans: Both of you have a combined income of Rs. 82,000 per month. You have a Sukanya Samriddhi plan and SIPs, but also have loans.

Reviewing Your Expenses
You pay Rs. 27,000 per month for loans. You also invest Rs. 14,000 in Sukanya Samriddhi and SIPs. This leaves you with Rs. 41,000 for other expenses.

Creating a Savings Plan
You need Rs. 2 lakhs by the end of the year. This requires disciplined saving. Set aside a fixed amount each month.

Reducing Non-Essential Expenses
Review and cut down on non-essential expenses. This helps increase your savings. Every small saving contributes to your goal.

Increasing SIP Investments
Consider increasing your SIP investments gradually. This helps build a corpus over time. Actively managed funds can give better returns.

Emergency Fund
Set up an emergency fund. This should cover 3-6 months of expenses. It provides financial security in case of unforeseen events.

Final Insights
Balancing expenses, loans, and savings is key. Discipline and regular reviews will help you achieve your goal of Rs. 2 lakhs by year-end.

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.
Money

You may like to see similar questions and answers below

Ramalingam

Ramalingam Kalirajan  |8013 Answers  |Ask -

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

Asked by Anonymous - Jan 22, 2024Hindi
Listen
Money
Hello .. I am 33 years old me and both me and my husband have started saving recently. We stay in mumbai and combined earn 3.2 lacs per month after tax. However due to different financial obligations and family responsibilities we are unable to do any savings. We have to spend about 80k for family and we also have different loans and obligations. Please provide us advise to invest and save better
Ans: It's commendable that despite financial obligations and family responsibilities, you're looking to pave a path towards savings and investment. Balancing present needs with future goals can indeed be a tightrope walk.

Firstly, let's look at your expenses. Allocating 80k for family expenses is a significant chunk of your income. While family comes first, there may be areas where you can optimize spending without compromising on essentials.

Given your combined income of 3.2 lacs post-tax, even a small percentage saved can make a difference over time. Start by creating a budget that outlines all your monthly expenses and identifies areas where you can cut back.

For savings and investments, consider starting small with a systematic investment plan (SIP). It allows you to invest a fixed amount regularly in mutual funds. Even a modest monthly SIP can accumulate into a substantial sum over time, thanks to the power of compounding.

Lastly, review your loans and obligations. Are there opportunities to refinance at lower interest rates or consolidate debts? This could free up some funds for savings.

Remember, financial planning is a journey, not a destination. It's okay to start small. The key is consistency and patience. With time, as your income grows and obligations reduce, you'll find it easier to save and invest more. Best of luck on your financial journey!

..Read more

Ramalingam

Ramalingam Kalirajan  |8013 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 01, 2024

Asked by Anonymous - Feb 20, 2024Hindi
Listen
Money
We are a couple earning Rs 60000 per month. My husband doesn't have any parental property. We need to save for our children and also buy house in future. We don't have child now. Please advise
Ans: Dear couple,

It's commendable that you are proactively planning for your future despite the current absence of children. Here are some steps you can take to work towards your financial goals:

Establish a Budget: Begin by creating a budget that outlines your monthly income and expenses. Identify areas where you can cut back on unnecessary spending and allocate a portion of your income towards savings and investments.

Emergency Fund: Start building an emergency fund to cover unexpected expenses such as medical emergencies or job loss. Aim to save at least three to six months' worth of living expenses in a readily accessible account.

Save for Children's Future: Even though you don't have children yet, it's never too early to start saving for their future education and other needs. Consider opening a dedicated savings account or investment account specifically earmarked for your future children's expenses.

Plan for Homeownership: While homeownership may seem like a distant goal, it's essential to start saving for a down payment early on. Set a savings target for your future home and explore options such as investing in mutual funds or other suitable investment vehicles to help you reach that goal.

Explore Insurance Options: Consider investing in life insurance and health insurance policies to protect your family's financial well-being in the event of unforeseen circumstances. Compare various insurance plans to find the ones that best suit your needs and budget.

Invest for Growth: Begin investing in mutual funds or other investment instruments that offer the potential for long-term growth. Consult with a financial advisor to assess your risk tolerance and investment objectives and develop a diversified investment portfolio accordingly.

Regularly Review and Adjust: Periodically review your financial plan and make adjustments as needed based on changes in your income, expenses, and financial goals. Stay disciplined in your savings and investment approach to ensure steady progress towards your objectives.

Seek Professional Guidance: If you feel overwhelmed or unsure about your financial decisions, don't hesitate to seek advice from a qualified financial advisor. A professional can provide personalized guidance tailored to your unique circumstances and help you make informed decisions.

By taking these proactive steps towards financial planning, you can lay a solid foundation for your future family's financial security and well-being. Remember that consistency, discipline, and patience are key to achieving your long-term financial goals.

Best wishes on your journey towards financial stability and prosperity.

..Read more

Ramalingam

Ramalingam Kalirajan  |8013 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 26, 2024

Asked by Anonymous - May 25, 2024Hindi
Listen
Money
I am 40 and my husband is 44yrs old together we earn 2lakh per month, we have housing loan for 80 lakh and 18lakh respectively, I have a 13yr old daughter how can I save money for our retirement and child higher education, please guide
Ans: Planning for Retirement and Child's Higher Education
Your combined monthly income of Rs 2 lakh is a solid base to build on. Managing housing loans while planning for retirement and your child's education requires a strategic approach. Let’s break it down step by step.

Understanding Your Financial Situation
You have an Rs 80 lakh housing loan and another Rs 18 lakh housing loan. Balancing these loans with your income and future goals is key. Your daughter is 13, so you have a few years to save for her higher education.

Setting Clear Financial Goals
1. Retirement Planning

You and your husband need a comfortable retirement plan. Think about the lifestyle you want post-retirement and estimate your expenses.

2. Child’s Higher Education

Higher education can be costly. Estimate the amount needed for her college fees, living expenses, and other related costs.

Creating a Budget
A well-structured budget helps manage expenses and savings efficiently. Allocate portions of your income to different needs:

Housing loan EMIs
Household expenses
Emergency fund
Investments for retirement
Savings for child’s education
Reducing Debt
Prioritise Debt Repayment

Focus on repaying the higher interest loan first. This reduces your financial burden faster and frees up money for savings and investments.

Consider Refinancing

Explore refinancing options to lower your EMIs. This can give you more disposable income to allocate towards your goals.

Building an Emergency Fund
An emergency fund should cover 6-12 months of living expenses. This protects you from financial shocks and prevents dipping into retirement or education savings.

Investing for Retirement
Diversified Portfolio

Invest in a mix of equity, debt, and hybrid funds. This balances risk and returns, ensuring steady growth over time.

Equity Funds

Given your risk appetite and time horizon, equity funds can offer higher returns. They are suitable for long-term investments.

Debt Funds

Debt funds provide stability and are less volatile. They help preserve capital and provide steady income.

Hybrid Funds

Hybrid funds invest in both equity and debt, balancing growth and safety. They are ideal for medium to long-term goals.

Saving for Child’s Higher Education
Systematic Investment Plan (SIP)

Start a SIP in equity mutual funds dedicated to your daughter’s education. This ensures disciplined savings and benefits from rupee cost averaging.

Education-specific Plans

Consider child education plans offered by mutual funds. These are tailored for education needs and provide a mix of growth and safety.

Regular Monitoring and Rebalancing
Track Your Investments

Regularly review your investment portfolio. This ensures your investments are performing well and aligned with your goals.

Rebalance Annually

Rebalance your portfolio annually to maintain the desired asset allocation. This keeps your investments on track to meet your objectives.

Consulting a Certified Financial Planner
A Certified Financial Planner (CFP) can provide personalised advice. They help you create a tailored investment strategy and navigate financial challenges.

Tax Planning
Utilise Tax Benefits

Make use of tax-saving instruments under Section 80C and 80D. This reduces your taxable income and increases your savings.

Tax-efficient Investments

Invest in tax-efficient funds that offer better post-tax returns. Consult with your CFP for suitable options.

Insurance Coverage
Life Insurance

Ensure adequate life insurance coverage for both you and your husband. This secures your family's financial future in case of any unfortunate event.

Health Insurance

A comprehensive health insurance plan protects you from high medical costs. It preserves your savings for retirement and education.

Final Thoughts
Your dedication to securing your financial future is admirable. By following these steps, you can effectively manage your loans, save for your daughter’s education, and plan for a comfortable retirement. Stay disciplined and periodically review your financial plan to ensure you are on track.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |8013 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 10, 2024

Money
My monthly income is Rs. 50,000. I have two children, and my monthly expenses are Rs. 35,000. I haven't been able to save anything so far. Please give me some tips so that I can save some money in the coming year and fund my children's education with my savings.
Ans: You have a monthly income of Rs. 50,000. Your monthly expenses are Rs. 35,000. You haven't been able to save anything so far. You also have two children and wish to fund their education with your savings.

Understanding Your Situation
I understand the pressure you feel managing expenses and trying to save. You're not alone, many face this challenge. Let's work on a plan to help you save and secure your children's future.

Evaluating Expenses
First, let's examine your expenses. Your monthly expenses are Rs. 35,000 out of Rs. 50,000 income. This leaves Rs. 15,000 as potential savings. Identifying areas where you can cut costs can significantly impact your savings.

Expense Breakdown
Let's categorize your expenses:

Essential Expenses: Rent, groceries, utilities, education fees.
Non-Essential Expenses: Dining out, entertainment, luxury items.
Tracking your spending for a month will highlight areas to reduce non-essential expenses.

Creating a Budget
Creating a budget is essential. Allocate a specific amount to each category:

Essentials: Rs. 25,000
Non-Essentials: Rs. 5,000
Savings: Rs. 10,000
Stick to this budget and monitor regularly.

Setting Financial Goals
Set short-term and long-term financial goals. Short-term goals include building an emergency fund. Long-term goals are funding your children's education and retirement.

Emergency Fund
Building an emergency fund is crucial. Aim for 3-6 months of living expenses. Start with Rs. 1,000 a month and gradually increase it.

Children's Education Fund
Investing in mutual funds can help grow your savings for your children's education. Mutual funds offer various options based on risk tolerance and investment horizon.

Mutual Funds: An Overview
Categories: There are equity, debt, hybrid funds. Equity funds invest in stocks, debt funds in bonds, hybrid in both.

Advantages: They offer diversification, professional management, and liquidity. They can deliver good returns over time.

Power of Compounding: Investing early helps. The returns on your investment earn returns, growing your wealth exponentially.

Actively Managed Funds vs. Index Funds
Actively managed funds have a fund manager making investment decisions. Index funds track a market index. Actively managed funds can outperform index funds, especially in volatile markets.

Disadvantages of Index Funds
Index funds have lower fees but don't beat the market. They follow the index and lack flexibility. Actively managed funds can adapt to market changes, aiming for higher returns.

Benefits of Regular Funds via MFD with CFP
Investing through a Certified Financial Planner (CFP) offers personalized advice. They help select funds matching your goals and risk profile. They provide regular reviews and adjustments to your portfolio.

Systematic Investment Plan (SIP)
SIP allows regular, disciplined investing. You invest a fixed amount monthly. This averages out purchase cost and reduces risk. Start a SIP in a mutual fund aligned with your goals.

Reviewing Insurance Policies
Ensure you have adequate life and health insurance. Avoid investment-linked insurance plans like ULIPs. Pure term insurance offers higher coverage at lower premiums.

Reducing Debt
If you have any debt, prioritize paying it off. High-interest debt can erode your savings. Create a plan to clear debt systematically.

Lifestyle Adjustments
Small lifestyle changes can lead to significant savings:

Cooking at Home: Reduces dining out expenses.
Public Transport: Saves on fuel and maintenance.
Bulk Buying: Reduces grocery costs.
Additional Income Streams
Consider side jobs or freelancing to boost income. This additional income can be directed towards savings and investments.

Educating Children on Financial Literacy
Teach your children the value of money. Encourage them to save and spend wisely. This fosters financial responsibility from a young age.

Tracking Progress
Regularly review your financial plan. Track your expenses and savings. Adjust your budget as needed to stay on track.

Seeking Professional Advice
Consulting a Certified Financial Planner can provide tailored advice. They can help create a comprehensive financial plan and guide your investments.

Emotional Well-being
Financial stress is common. Remember to take care of your mental health. Balance saving with enjoying life. Celebrate small financial milestones.

Final Insights
Saving for your children's education while managing expenses is challenging but achievable. Focus on budgeting, reducing non-essential expenses, and investing wisely. Utilize mutual funds for their potential returns and power of compounding. Avoid index funds in favor of actively managed funds. Seek guidance from a Certified Financial Planner for personalized advice. Small lifestyle adjustments can lead to significant savings. Remember to take care of your emotional well-being during this journey. You're on the right path, and with consistent efforts, you can achieve your financial goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Latest Questions
Rajesh Kumar

Rajesh Kumar Singh  |68 Answers  |Ask -

IIT-JEE, GATE Expert - Answered on Feb 19, 2025

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.

Close  

You haven't logged in yet. To ask a question, Please Log in below
Login

A verification OTP will be sent to this
Mobile Number / Email

Enter OTP
A 6 digit code has been sent to

Resend OTP in120seconds

Dear User, You have not registered yet. Please register by filling the fields below to get expert answers from our Gurus
Sign up

By signing up, you agree to our
Terms & Conditions and Privacy Policy

Already have an account?

Enter OTP
A 6 digit code has been sent to Mobile

Resend OTP in120seconds

x