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Sanjeev Govila |458 Answers |Ask -Follow

Financial Planner - Answered on Feb 06, 2024

Colonel Sanjeev Govila (retd) is the founder of Hum Fauji Initiatives, a financial planning company dedicated to the armed forces personnel and their families.
He has over 12 years of experience in financial planning and is a SEBI certified registered investment advisor; he is also accredited with AMFI and IRDA.... more

Asked by Anonymous - Jan 16, 2024Hindi

Money

Hi I'm 28 years old with 1 kid as of now will plan 2nd after 3 years, I want to build a decent education and marriage corpus for children, planning to take flat in 2024 year end , my salary is 1.2lakh p/m Currently my investment are as follows Mutual fund - 3.5lakh lumsump in 4 funds Quant infrastructure 50k Pgim india mid cap 1lk Hdfc s&p bse 500 1lk ICICI prudential comodity 1lk Started NPS of 25k yearly payment since 2023 I need more suggestions My target is have some decent education fund for children and decent fund for children marriage

Ans: It's commendable that you're already planning for your children's education and marriage and taking steps to build their corpus. Based on the details you've provided.
Your current portfolio seems sufficiently diversified across various fund categories, including mid-cap, large-cap, commodity, and NPS. However, it is worth reviewing their performance and suitability for your goals.

• Investments should be allocated based on each child's specific goals, considering timelines and child-specific mutual funds with longer horizons for education

• If you have good research skills and risk tolerance, consider adding direct equity for higher returns. Remember, this carries a higher risk.

• Even a small increase can significantly impact your corpus over time due to compounding. If possible, try to increase your monthly investments

• It is important to regularly review your portfolio's performance and adjust your asset allocation as needed to maintain your desired mix.

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 Kalirajan |2337 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on Apr 08, 2024

Asked by Anonymous - Apr 08, 2024Hindi

Money

Dear Sir, My inhand salary is approx 1 Lac per month. My wife's salary in hand is 60k per month. We have a kid of 1 year now. Our goal is to create a corpus amount of 4Crores for Childs education and well being. Current investments are 1. Equities-20 Lacs, Mutual Funds Quant, parikh, sbi, 5 Lacs total. Ppf 10 Lacs, Nps 2 Lacs, My requirements are 1. Need amount of 4 Cr at 2040 2. Currently I need best Term plan to invest in with cover of 3Cr 3. Need to know best health insurance for any medical emergency with family cover of 25Lacs. 4. Need to Buy a Home of 1.5 Cr 2bhk for which I will be going for Home loan of minimum 60Lacs. 5. Risk appetite medium to high

Ans: Given your financial goals and risk appetite, here are some recommendations:

Investments:

Continue investing in equity through mutual funds for long-term wealth creation.
Consider increasing your equity exposure gradually, given your high risk tolerance.
Regularly review and rebalance your investment portfolio to ensure alignment with your goals and risk tolerance.
Term Insurance:

Look for reputable insurance providers offering term plans with coverage of at least 3 Crores.
Compare premiums, features, and claim settlement ratios before making a decision.
Consider opting for a policy with a rider for critical illness coverage for added protection.
Health Insurance:

Choose a comprehensive family health insurance plan with a coverage of 25 Lakhs.
Look for plans that offer coverage for hospitalization, pre-existing conditions, day care procedures, and maternity benefits.
Consider factors such as network hospitals, claim settlement process, and premium affordability.
Home Purchase:

Since you plan to buy a home worth 1.5 Crores and avail a home loan, ensure that the EMIs are comfortably manageable within your monthly budget.
Compare home loan offers from various banks and financial institutions to get the best interest rates and terms.
Factor in additional costs such as registration fees, stamp duty, and maintenance expenses while budgeting for the purchase.
Financial Planning:

Consult with a certified financial planner to create a comprehensive financial plan tailored to your specific goals, risk tolerance, and financial situation.
Regularly review your financial plan and make adjustments as needed based on changes in your circumstances or market conditions.
By implementing these strategies and regularly monitoring your progress, you can work towards achieving your financial goals while managing risk effectively.

Ramalingam Kalirajan |2337 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on May 14, 2024

Asked by Anonymous - May 04, 2024Hindi

Money

Hi sir I am 34 years with take home 75k. Present wife not working and we are having w year daughter and 2 months son. My tax regime is new My expenses as Home loan 11k. Car loan 10.5k. Other expenses 10k. Home expenses and maid 10k. Term insurance yearly 19k with 1 cr coverage. Please suggest me investment of 10-12k Daughter Son Kids higher education Retirement My planning ssy of 50k yearly and nps of 50k Please suggest.

Ans: It's wonderful to see your proactive approach to securing your family's financial future, especially with young children to care for. Let's explore how you can allocate your resources effectively to meet your various financial goals.

Prioritizing Your Investments
Given your income, expenses, and specific financial goals, here's a suggested investment strategy tailored to your needs:

1. Children's Education:
Investing in your children's education is crucial for their future success. Consider opening separate savings accounts or investment plans for your daughter and son. Allocate a portion of your monthly budget (around Rs. 2,000 to Rs. 2,500 each) towards these accounts to accumulate funds over time. Opt for investment options with moderate risk and potential for long-term growth, such as mutual funds or child education plans.

2. Retirement Planning:
It's never too early to start planning for your retirement. Allocate a portion of your monthly budget (around Rs. 3,000 to Rs. 4,000) towards retirement savings. Maximize contributions to your NPS account, taking advantage of the tax benefits offered under the new tax regime. Additionally, consider investing in equity mutual funds or voluntary provident fund (VPF) to supplement your retirement corpus further.

3. Term Insurance:
You've already taken a significant step by securing term insurance coverage of Rs. 1 crore. Ensure that your coverage amount is sufficient to meet your family's financial needs in case of any unfortunate event. Review your insurance needs periodically, especially as your family and financial responsibilities evolve.

4. Emergency Fund:
Building an emergency fund is essential to handle unexpected expenses or financial setbacks. Aim to set aside an amount equivalent to 3 to 6 months' worth of living expenses in a high-yield savings account or liquid mutual fund. Start with a small portion of your monthly budget (around Rs. 1,000 to Rs. 2,000) towards this fund and gradually increase it over time.

Monitoring and Adjusting Your Plan
Regularly review your financial plan to track progress towards your goals and make any necessary adjustments. As your income increases or expenses change, you may need to reallocate your resources accordingly. Consider consulting with a Certified Financial Planner to ensure that your investment strategy remains aligned with your long-term objectives.

Conclusion
By following this investment plan and staying disciplined in your approach, you can build a solid financial foundation for your family's future. Remember that consistency and patience are key to achieving your financial goals over time.

Best Regards,
K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

Ramalingam Kalirajan |2337 Answers |Ask -Follow

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

Question by Shriprakash - May 04, 2024Hindi

Money

Sir, Myself 31 yr married and a working professional in Pvt sector with an emergency Corpus of 1,50,000 which would be okay for me till 4-6 months. I already have term insurance of 1 cr and health insurance for my family. I want to seek advice on investment. I have still not started any investment in stocks or MF. My financial goals are as below: Short term : 1. Car under 10 lac after 6 - 7 years 2. House (2bhk) in 10-12 years (i already stay at our parents own house so not in a hurry to purchase my own house) Long term : 1. Child education after 17 years with a Corpus of 20-25 lacs 2. Child marriage after 22 years with a Corpus of 25-30 lacs 3. Retirement after 25 years with a Corpus of 1 cr. My current salary is 50k in hand. Pls suggest.

Ans: Given your financial goals and current situation, it's great to see that you've already established an emergency corpus and have adequate insurance coverage. Now, let's focus on your investment strategy to achieve your goals.

For your short-term goals like buying a car and a house, which are 6-12 years away, consider investing in a mix of equity and debt instruments. Equity mutual funds can provide the potential for higher returns over the long term, which aligns well with your time horizon. Debt instruments like fixed deposits or debt mutual funds can offer stability for your shorter-term goals.

For your long-term goals, such as your child's education, marriage, and your retirement, you can afford to take more risk and invest primarily in equity mutual funds. These investments have the potential to generate higher returns over a longer period, helping you build the required corpus.

Since you're new to investing in stocks or mutual funds, it's advisable to start with systematic investment plans (SIPs). SIPs allow you to invest regularly in mutual funds, helping you benefit from rupee-cost averaging and reducing the impact of market volatility.

Considering your current salary of 50k in hand, assess your monthly surplus after meeting your expenses and allocate a portion towards SIPs for each of your goals. A Certified Financial Planner can assist you in creating a customized investment plan tailored to your goals, risk tolerance, and financial situation.

Remember to review your investments periodically and make adjustments as needed to stay on track towards achieving your financial goals. With discipline and patience, you can build a solid foundation for your future financial security.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

Latest Questions

Ramalingam Kalirajan |2337 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on May 17, 2024

Question by Santosh - May 16, 2024Hindi

Money

Does the 4% rule applies in India considering Inflation

Ans: The 4% withdrawal rule is a widely used guideline in retirement planning, primarily based on historical data from the United States. It suggests that retirees can withdraw 4% of their retirement savings annually without running out of money for at least 30 years. However, applying this rule in India requires a nuanced approach due to differences in inflation rates, market conditions, and economic factors. Let's analyze its applicability in the Indian context.

The 4% Rule and Inflation
Origin of the 4% Rule
Developed by Financial Planner: William Bengen in the 1990s.
Assumptions: Based on historical returns from US stocks and bonds, and inflation rates.
Differences in Indian Inflation
Higher Inflation Rate: Historically, India experiences higher inflation compared to the US, often ranging between 6-8%.
Impact on Purchasing Power: Higher inflation erodes purchasing power more quickly, necessitating a higher withdrawal rate to maintain the same standard of living.
Applicability of the 4% Rule in India
Higher Withdrawal Rate Required
Due to higher inflation, a 4% withdrawal rate may not be sufficient for Indian retirees. They might need to consider a slightly higher rate, adjusted for local inflation rates, to meet their financial needs.

Market Returns and Volatility
Equity Market Returns: Indian equity markets have the potential for higher returns compared to developed markets, but they also come with higher volatility.
Fixed Income Instruments: Fixed deposits and government bonds in India offer higher interest rates than in the US, providing a safety net for retirees.
Adapting the Rule to Indian Conditions
Conservative Approach
Lower Initial Withdrawal Rate: Start with a lower initial withdrawal rate, such as 3-3.5%, to account for higher inflation and market volatility.
Increase with Caution: Gradually increase the withdrawal rate based on the performance of your investments and inflation trends.
Dynamic Withdrawal Strategy
Flexible Withdrawals: Adjust the withdrawal amount annually based on portfolio performance and inflation. This helps in managing longevity risk and preserving capital.
Bucket Strategy: Divide your retirement corpus into different buckets – short-term (cash, FDs), medium-term (debt funds), and long-term (equity funds). Withdraw from the least volatile bucket first.
Practical Steps for Indian Retirees
Diversified Portfolio
Asset Allocation: Maintain a diversified portfolio with a mix of equities, debt, and other asset classes. This helps in balancing risk and returns.
Periodic Review: Regularly review and rebalance your portfolio to align with changing market conditions and personal needs.
Inflation-Protected Investments
Inflation-Linked Investments: Consider investing in instruments that provide inflation protection, such as hybrid funds.
Real Estate and Gold: These assets can act as a hedge against inflation, though they come with their own set of risks and liquidity issues.
Professional Guidance
Certified Financial Planner: Consult a Certified Financial Planner to tailor the withdrawal strategy based on your specific financial situation and goals. They can provide personalized advice considering your risk tolerance and retirement horizon.
Conclusion
While the 4% withdrawal rule offers a starting point for retirement planning, its direct application in India requires adjustments for higher inflation and different market conditions. Adopting a flexible and dynamic withdrawal strategy, maintaining a diversified portfolio, and seeking professional advice are essential steps to ensure a sustainable retirement income in India.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

Ramalingam Kalirajan |2337 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on May 17, 2024

Question by Dinesh - May 16, 2024Hindi

Money

How to plan for my child education

Ans: Ensuring your child’s education is one of the most significant financial goals. It requires early and disciplined planning to manage the costs effectively. Here’s a step-by-step guide to help you plan for your child’s education.

Step 1: Estimate the Cost of Education
Consider Current Costs and Inflation
Current Fees: Determine the current cost of the education you aim for, whether it's for school, college, or higher studies.
Inflation Rate: Education costs generally rise by 8-10% annually. Use this rate to estimate future costs.
Example
If the current cost of education is ?10 lakhs, in 10 years with 8% inflation, it would be around ?21.6 lakhs.

Step 2: Determine the Time Horizon
Calculate the number of years until your child starts their education. This will help in determining the investment period and strategy.

Step 3: Set a Target Amount
Based on your estimate, set a target amount you need to accumulate by the time your child begins their education.

Step 4: Choose Suitable Investment Options
Equity Mutual Funds
Long-Term Growth: Equity mutual funds are ideal for long-term goals (more than 5 years) due to their potential for higher returns.
Systematic Investment Plan (SIP): Invest regularly through SIPs to benefit from rupee cost averaging and the power of compounding.
Debt Mutual Funds
Stability: For medium-term goals (3-5 years), debt mutual funds provide stability and moderate returns.
Less Volatility: These funds are less volatile compared to equity funds.
Public Provident Fund (PPF)
Risk-Free Returns: PPF offers tax-free returns and is a safe investment for long-term goals.
Lock-in Period: PPF has a 15-year lock-in period, making it suitable for long-term planning.
Fixed Deposits (FD)
Safety: Bank FDs provide assured returns and are a safe investment option.
Flexibility: Suitable for short to medium-term goals.
Step 5: Start Early and Invest Regularly
Early Start
Starting early allows you to invest smaller amounts regularly and benefit from compounding. The earlier you start, the easier it is to reach your target amount.

Regular Investments
Invest regularly through SIPs in mutual funds or recurring deposits. This instills discipline and ensures consistent growth of your investment corpus.

Step 6: Review and Adjust Your Plan
Regular Reviews
Review your investment portfolio annually to ensure it aligns with your goals. Adjust your investment amount based on changes in your financial situation or education costs.

Rebalancing
Rebalance your portfolio periodically to maintain the desired asset allocation. Shift funds from equity to debt as you approach your goal to reduce risk.

Step 7: Tax Planning
Tax-Advantaged Investments
Invest in instruments like PPF or ELSS (Equity Linked Savings Scheme) for tax benefits under Section 80C.

Plan Withdrawals
Plan your withdrawals to minimize tax liability. For example, long-term capital gains from equity funds held for more than one year are taxed at a lower rate.

Conclusion
Planning for your child’s education requires a strategic approach involving estimating costs, setting a target amount, choosing suitable investments, and starting early. Regular reviews and adjustments ensure you stay on track. By following these steps, you can secure your child’s future education needs effectively.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

Ramalingam Kalirajan |2337 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on May 17, 2024

Question by Somnath - May 16, 2024Hindi

Money

Please let me know the best & secured investment of 10 lacs with monthly income plan

Ans: Investing ?10 lakhs to generate a secure and steady monthly income requires a balanced approach that ensures safety while providing reasonable returns. Here are some options to consider:

Senior Citizens' Savings Scheme (SCSS)
Overview
Eligibility: Individuals aged 60 years and above.
Investment Limit: Up to ?15 lakhs.
Interest Rate: Typically higher than regular fixed deposits.
Tenure: 5 years, extendable by 3 years.
Payout: Quarterly interest payouts.
Benefits
Safety: Backed by the Government of India, ensuring high security.
Regular Income: Provides a steady income every quarter.
Tax Benefits: Eligible for tax deduction under Section 80C.
Post Office Monthly Income Scheme (POMIS)
Overview
Eligibility: Open to all Indian residents.
Investment Limit: ?4.5 lakhs per individual, ?9 lakhs for joint accounts.
Interest Rate: Fixed, and reviewed quarterly.
Tenure: 5 years.
Payout: Monthly interest payouts.
Benefits
Safety: Government-backed, offering high security.
Regular Income: Monthly interest payouts for consistent cash flow.
Fixed Deposits (FD) in Banks
Overview
Eligibility: Available to all.
Interest Rate: Varies by bank, generally lower than SCSS but higher for senior citizens.
Tenure: Flexible, typically ranges from 1 to 10 years.
Payout: Monthly, quarterly, or annual interest payouts.
Benefits
Safety: Up to ?5 lakhs insured by Deposit Insurance and Credit Guarantee Corporation (DICGC).
Flexibility: Choose tenure and interest payout frequency based on needs.
Senior Citizen Benefits: Higher interest rates for senior citizens.
Mutual Funds with Systematic Withdrawal Plan (SWP)
Overview
Eligibility: Open to all.
Types of Funds: Debt mutual funds for lower risk.
Payout: Monthly withdrawal as per chosen amount.
Benefits
Flexibility: Choose the amount and frequency of withdrawals.
Tax Efficiency: Better post-tax returns compared to traditional savings options.
Potential Growth: Debt funds offer higher returns compared to fixed deposits.
Combining Investments for Optimal Security and Returns
To maximize security and ensure a steady monthly income, consider diversifying your ?10 lakhs across different instruments. Here's a suggested allocation:

Senior Citizens' Savings Scheme (SCSS)
Investment: ?4 lakhs.
Monthly Income: Approximately ?2,800.
Post Office Monthly Income Scheme (POMIS)
Investment: ?4.5 lakhs.
Monthly Income: Approximately ?3,150.
Bank Fixed Deposit (FD)
Investment: ?1.5 lakhs.
Monthly Income: Approximately ?900 (assuming a 7.2% annual interest rate for senior citizens).
Conclusion
This diversified approach ensures a secure investment with a steady monthly income. The combination of SCSS, POMIS, and FD provides a blend of safety, regular income, and tax benefits. Adjust the allocation based on your specific needs and preferences.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

Ramalingam Kalirajan |2337 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on May 17, 2024

Question by Sunish - May 11, 2024Hindi

Money

Sir, l retir in feb24. I have 40 lakh case and 65000 monthly income. How can get in after ten years 2 lakh per month

Ans: Your goal of achieving a monthly income of ?2 lakh after ten years is ambitious but achievable with disciplined planning. Here’s a detailed plan to help you meet this goal using your ?40 lakh corpus and current monthly income of ?65,000.

Step 1: Assess Your Current Financial Status
Your current financial standing includes:

?40 lakh corpus.
?65,000 monthly income.
To achieve a future monthly income of ?2 lakh, focus on disciplined savings, strategic investments, and regular reviews.

Step 2: Define Investment Goals
Your primary goal is to grow your corpus sufficiently to generate a monthly income of ?2 lakh after ten years. This requires your investments to grow significantly, taking into account inflation and taxes.

Step 3: Strategic Investment Allocation
Diversified Portfolio
A diversified investment portfolio can balance risk and return effectively. Here’s a suggested allocation:

Equity Mutual Funds (60%):

Amount: ?24 lakh.
Rationale: Equity mutual funds have the potential for high returns over the long term. They can help your corpus grow substantially. Choose actively managed funds to benefit from professional expertise.
Debt Mutual Funds (20%):

Amount: ?8 lakh.
Rationale: Debt funds provide stability and regular income with moderate risk. They help in balancing the volatility of equity investments.
Public Provident Fund (PPF) (10%):

Amount: ?4 lakh.
Rationale: PPF is a safe, long-term investment with tax-free returns. It adds a layer of security to your portfolio.
Fixed Deposits (10%):

Amount: ?4 lakh.
Rationale: Fixed deposits offer guaranteed returns and liquidity. Keep these funds accessible for emergencies or short-term needs.
Monthly Investment from Income
SIP in Equity Mutual Funds:

Amount: ?35,000 per month.
Rationale: Systematic Investment Plans (SIPs) help in averaging out market volatility and benefit from the power of compounding.
Recurring Deposit or Debt Mutual Fund SIP:

Amount: ?20,000 per month.
Rationale: Provides stable and assured returns, ensuring a balanced risk profile.
Step 4: Regular Reviews and Adjustments
Monitor your investments regularly. Review and adjust your portfolio based on market conditions and performance. Rebalancing your portfolio annually can help in maintaining the desired asset allocation.

Step 5: Focus on Tax Efficiency
To minimize taxes, consider:

Equity Funds: Long-term capital gains on equity funds are taxed at a lower rate.
Debt Funds: Hold for more than three years to benefit from indexation, which reduces taxable income.
Step 6: Inflation Adjustment
Ensure your investments are growing at a rate higher than inflation. Historically, equity mutual funds have provided returns that outpace inflation, making them essential for long-term growth.

Step 7: Projected Growth and Future Income
Assuming an average annual return of 12% from your equity investments and 7% from debt investments, your ?40 lakh corpus, along with monthly SIPs, should grow significantly over ten years. Regularly increasing your SIP amount in line with salary increments can further enhance your corpus.

Conclusion
Achieving a monthly income of ?2 lakh after ten years requires a strategic investment approach. Diversifying your portfolio, focusing on equity mutual funds for growth, and maintaining tax efficiency are crucial steps. Regular reviews and disciplined investing will guide you towards your financial goal.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

Ramalingam Kalirajan |2337 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on May 17, 2024

Question by Thomas - May 16, 2024Hindi

Money

I am 60 years old and just retired from service. I ll get Rs 40k as monthly pension. My wife is housewife. I have own house and an apartment which is rented. No loans. I have two daughters elder married and settled at USA and younger is studying in USA. I have enough fund for her studies and her marriage. I have 2 crore corpus as retirement benefits and my savings. We have covered by my company providing medical facilities. I am planning to invest 1cr in MFs with SWP of 25k per month. SCSS - 30L, POMIS - 9L and FD of 2L on my wife name in post office. Continue and invest in PPF - 20L. Emergency fund FD - 20L. I want to get enough money for my monthly and annual expenditure and grow the corpus beating inflation minimising income tax. Request your review and advice about my financial plan.

Ans: Your financial plan exhibits careful consideration of various aspects of retirement planning. With no loans and a substantial corpus, you are in a favorable position. Here's an analytical review of your plan and some suggestions for optimizing your strategy.

Monthly and Annual Income
With a monthly pension of ?40,000 and additional rental income, your immediate cash flow needs are well-covered. The planned Systematic Withdrawal Plan (SWP) from Mutual Funds (MFs) will supplement this, providing additional liquidity.

Mutual Funds with SWP
Investing ?1 crore in Mutual Funds with a SWP of ?25,000 per month is a solid strategy. Mutual Funds offer potential for capital appreciation and can help in beating inflation over the long term. Actively managed funds are recommended over index funds due to the potential for higher returns.

Senior Citizens Savings Scheme (SCSS)
Allocating ?30 lakh to SCSS is a wise choice. SCSS offers attractive interest rates, tax benefits under Section 80C, and regular quarterly interest payouts, which will further support your monthly cash flow.

Post Office Monthly Income Scheme (POMIS)
Investing ?9 lakh in POMIS provides a reliable source of monthly income. This scheme offers a fixed monthly return, which can help in managing your monthly expenses.

Fixed Deposit (FD) in Post Office
The FD of ?2 lakh in your wife's name is a conservative yet safe option. Post Office FDs offer guaranteed returns, although they are relatively low. Ensure to reinvest upon maturity to continue earning interest.

Public Provident Fund (PPF)
Continuing to invest ?20 lakh in PPF is an excellent decision. PPF provides tax-free returns, compounded annually, and is a risk-free investment option. It also contributes to your retirement corpus growth, albeit with a lock-in period of 15 years.

Emergency Fund
Maintaining an emergency fund of ?20 lakh in FD ensures that you have quick access to funds in case of unforeseen circumstances. This amount seems adequate considering your overall financial situation.

Tax Efficiency and Inflation Protection
To minimize tax and beat inflation, consider the following suggestions:

Tax-efficient Investments: Ensure that your mutual funds include equity-oriented funds, as these have favorable tax treatment compared to debt funds. Long-term capital gains from equity funds are taxed at a lower rate.
Diversification: Diversify your mutual fund investments across equity, debt, and hybrid funds to balance risk and returns. This will help in managing market volatility and securing steady returns.
Regular Review: Periodically review your portfolio to adjust for changing market conditions and life events. Consulting with a Certified Financial Planner can help you make informed decisions.
Long-term Growth and Security
Your plan should focus on growth while ensuring security. Diversification across different asset classes helps in managing risks. Ensure to keep some funds in liquid assets for any immediate requirements.

Empathy and Understanding
Your plan shows a thoughtful approach towards securing your and your family's future. The allocation towards your daughters' education and marriage demonstrates your responsible planning.

Conclusion
Your financial plan is well-structured, balancing income, growth, and security. By focusing on diversified investments, tax efficiency, and periodic reviews, you can achieve your goal of a comfortable retirement, managing your expenses, and growing your corpus to beat inflation.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

Ramalingam Kalirajan |2337 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on May 17, 2024

Asked by Anonymous - May 17, 2024Hindi

Money

Hi I have ab EMI of 28k per month, i also have SIP of 16k form last 4 years (started with 10k). Will it be a good decision to use fund valuation amount to settle (or reduce) loan and start SIP for around 45k-50k?

Ans: It’s commendable that you have been consistent with your SIP for the last four years. Your disciplined approach shows a commitment to long-term financial goals. Balancing an EMI of ?28,000 with an SIP of ?16,000 indicates a good grasp of financial planning.

However, evaluating whether to use your SIP funds to reduce your loan requires a careful analysis of several factors.

Loan Repayment vs. Investment Growth
Consider the interest rate on your loan. If your loan interest rate is higher than the average returns on your SIP, it might make sense to repay the loan.

Reducing your debt can also provide a sense of financial relief and improve your cash flow.

Opportunity Cost of Withdrawing SIP
By withdrawing your SIP, you may lose out on potential future gains from compounding.

Investments typically grow over time, and redeeming them prematurely could hinder your financial growth.

The decision should weigh the immediate benefit of debt reduction against the long-term benefit of staying invested.

Impact on Financial Goals
Reflect on your financial goals. If you use your SIP funds to pay off the loan, will you be able to rebuild your investment corpus quickly?

Starting a higher SIP of ?45,000-?50,000 is a good plan, but it will take time to recover the withdrawn amount.

Benefits of Actively Managed Funds
If you decide to continue investing, consider actively managed funds.

These funds are managed by experts who aim to outperform the market. Unlike index funds, actively managed funds offer the potential for higher returns, though they come with higher fees.

Professional Guidance
Consulting a Certified Financial Planner can provide personalized advice. A professional can help you assess the best strategy based on your specific financial situation and goals.

Evaluating Direct vs. Regular Funds
Direct funds might seem cost-effective, but they lack the professional guidance offered by regular funds.

Investing through a Mutual Fund Distributor (MFD) with a Certified Financial Planner credential ensures you receive expert advice.

This can help in making informed decisions and potentially achieving better returns.

Empathy and Understanding
We understand that managing an EMI and investments simultaneously can be challenging. Your desire to make the best financial decision is important.

By carefully considering your options and seeking professional guidance, you can navigate this decision effectively.

Conclusion
In conclusion, using your SIP funds to pay off your loan could provide immediate relief, but it might impact your long-term financial growth.

Balancing debt repayment with continued investment requires careful planning.

Consult a Certified Financial Planner to help you make an informed decision that aligns with your financial goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

Ravi Mittal |193 Answers |Ask -Follow

Dating, Relationships Expert - Answered on May 16, 2024

Asked by Anonymous - May 10, 2024Hindi

Relationship

Hello Sir, it has been 4 years since I got married. I have two kids. My wife loves me a lot. One day, in a casual conversation, she told me about her past life before marriage. I too had physical relations with a friend. Since then, I have been in depression. What should I do? I am unable to understand. Should I separate or leave her. Although now she keeps crying that that was the past. Now I love you very much, but I am unable to understand what to do. Please guide us. I feel that my life has been ruined. I am unable to understand ????????

Ans: Dear Anonymous,

I am assuming that whatever your wife confessed happened before you met her. And assuming that I want to ask you, are you seriously mad at your partner for having a life before you even existed for her? Is that even something to be concerned about? Everyone has a past. If you did not, that's your choice. She did, that's hers. How can you judge her for something that happened before you two got married? This anger, no matter how real it feels, is quite baseless. You are ruining your peace and marriage for nothing.

And you say, "She is crying that that was her past," why does she have to cry? It was indeed in her past. It is entirely up to the person whether they want to disclose it or not. Past is supposed to be in the past. Have a clear discussion with your wife. If things don't seem to cool down, I recommend seeing a marriage counselor who can help sort this issue in a more structured way.

Best Wishes.

Ravi Mittal |193 Answers |Ask -Follow

Dating, Relationships Expert - Answered on May 16, 2024

Asked by Anonymous - May 16, 2024Hindi

Relationship

Dear LG, Please keep this anonymous. I have been married since 6 years. However, since past 5+ years we have not been intimate. We haave a 5&1/2 year kid. Since his birth we have had a lot of differences and his family interference was lot leaving me alone and wounded. I don't stay with my husband and in-laws since then. I had made up that work is worship. But 2 years back I met a colleague. He is 10 years younger to me and we have extremely similar vibes. We enjoy each other's company and cared a lot. Eventually i fell in love with him. But he always knew he wont be able to go against his family. We also had relationship. Now he has strated looking for girls and wants us to stop being intimate. He is saying he wants to be friends and not loose me but not have relationship. We both work together in same space and our area of work is also same. I am unable to forgive my husband and forget this person. He never goes away. He is always there telling that I want to see you happy. He needs me for professional development. And i am not able to loose our relationship. He says physical intimacy only I cant have remaining Im there. Then again says I don’t know when I will be there so I am unable to give assurance or promise. I am tormented with a child, work and my health is getting affected. Can you please help?

Ans: Dear Anonymous,

I am sorry that you are in such a tough spot. My advice would be to move on. Yes, I realize that it is easier said than done but let's put things into perspective- first, you have no future with this man, and he has made it clear. Are you okay to keep hanging on to him while he builds his own life? I am assuming no, especially since you have a child. Second, what about your self-respect? He is directly telling you that this relationship is headed toward a dead end. Do you believe you deserve to be with someone who does not want to settle down with you? I believe you deserve better.

I am not blaming him because he made no promises. You are not to be held guilty either because you were in a tough spot and you grabbed the first emotional support you found. But the current reality is that he wants out. And convincing him to stay is not an option. At this point, moving on with your head held high is the best decision. If you want to accept his friendship, that is completely fine. But if that's too much for you, you can always decline it. I understand that working in the same space with an ex is difficult, but as long as you avoid interacting outside of the office and keep things professional, there should not be an issue. On the emotional front, I won't lie, it will hurt for a while. But this too shall pass. I strongly recommend you not to value yourself so low that you stop believing that you deserve a person who loves you back as much as you love him.

Best Wishes.

Sunil Lala |190 Answers |Ask -Follow

Financial Planner - Answered on May 16, 2024

Asked by Anonymous - May 13, 2024Hindi

Money

I am 25 and earning 41k a month. My monthly expenses are 19k and I save around 22k a month. I have started investing in mutual funds and investing 12k/month. My financial goal is to have a corpus of 4-5 Cr at the time of my retirement. Would like to retire at 55. Should I consider investing in NPS? Please advise.

Ans: Increase your SIP in mutual funds as with current investment of SIP you will be able to make 2.25 to 2.5 crore

Sunil Lala |190 Answers |Ask -Follow

Financial Planner - Answered on May 16, 2024

Question by Shambhu - May 13, 2024Hindi

Money

I am 45 yrs old .i hv started investing in Mutual fund through Sip approx month 2.4lakh since last 6 month. I hv plan to keep investing for next 3 yrs in same pattern and subject to availability of fund remaining I can continue further for next 5 yrs . Following are investment UTI nifty 200 momentum 30 index - 50 k Nippon nifty 250 small cap index fund -25k ICICI prudential mid cap 150 index fund-20 k HDFC s&p Sensex index fund-20 k Aditya Birla psu equity fund-20 k Motilal Oswal mid cap fund-20k HDFC infrastructure fund-20 k HDFC large and mid cap fund-10 k Quant small cap-10k Nippon small cap -10 k Parag flexi cap- 10 k Mahendra manulife multicap- 10 k Sbi contra fund-10 k Please advise on my fund selection and suggest which plan to to be removed or amend with new plan suggested from you

Ans: Your funds are good

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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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