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Ramalingam

Ramalingam Kalirajan  |8495 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 02, 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 - Feb 17, 2024Hindi
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I'm aged 35 years working in psb getting net salary of 60000(after the deduction of nps and tax) and having fd of 35 lakhs and loan against of 20 lakhs at 7.5% and I'm doing monthly sip 2k( in 3mfs and lumpsum when ever I felt market down another 4 mutualfunds now valued 35k) and yearly ssy of 1.5 lakhs and monthly interest on fd 18k and loan interest of 14k and I have invested loan amount in land now it valued at 40L Now I want create corpus 4cr in coming 12 years in what way I have to invest either I have to clear 20 lakh or I have to invest in mutualfunds wage revision is pending once it settled my net salary arround 90k and I have given hand loan of 3lakhs these will be repaid with in 3 months Please guide me regarding investing strategy

Ans: To create a corpus of 4 crores in the next 12 years, you can consider the following strategies:

Evaluate your loan situation: Assess whether it's better to clear the existing loan of 20 lakhs or to continue investing in mutual funds. Compare the loan interest rate with the potential returns from your investments to make an informed decision.

Increase investment contributions: With the expected increase in your net salary after the wage revision, consider increasing your SIP contributions in mutual funds to accelerate wealth accumulation.

Optimize existing investments: Review your current mutual fund holdings and reallocate them if needed to align with your long-term financial goals and risk tolerance.

Diversify your portfolio: Consider diversifying your investments across different asset classes such as equity, debt, real estate, and alternative investments to manage risk and maximize returns.

Regularly review and adjust: Monitor your investments regularly and make adjustments as needed based on changing market conditions, financial goals, and personal circumstances.

Consult with a financial advisor to develop a customized investment plan tailored to your specific needs and objectives. They can provide personalized guidance and help you navigate through your investment decisions effectively.
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  |8495 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 18, 2024

Asked by Anonymous - Apr 19, 2024Hindi
Money
I need suggestion on how to make a good corpus in next 5 years.. I am a female of 33 yrs age and I earn 2 lakhs per month. I have invested in shares and have life insurance of LIC and ICICI of 5 lakhs each which will mature in 2038 Should I make more risky investments or should I make riskfree investments like PPF. I am also opting for new regime in tax so does it make sense to go for voluntary NPS of 50k per year.
Ans: Building a Corpus in 5 Years: Strategic Planning

Guidance on Investment Strategies and Financial Planning

Your aspiration to build a substantial corpus over the next 5 years reflects a proactive approach towards financial growth. Let's explore suitable investment avenues considering your income, risk appetite, and tax planning preferences to optimize your wealth accumulation.

Understanding Financial Goals and Risk Appetite

As a 33-year-old female with a monthly income of 2 lakhs, it's essential to align your investment strategy with your financial goals and risk tolerance. Assess your willingness to accept risk and volatility in pursuit of higher returns versus prioritizing capital preservation and stability.

Balancing Risk and Return

Considering your existing investments in shares and life insurance policies, evaluate the overall risk exposure of your portfolio. While higher-risk investments offer the potential for greater returns, they also entail increased volatility and the possibility of capital loss. Assess your comfort level with risk and diversify your portfolio accordingly.

Insurance-cum-investment schemes
Insurance-cum-investment schemes (ULIPs, endowment plans) offer a one-stop solution for insurance and investment needs. However, they might not be the best choice for pure investment due to:
• Lower Potential Returns: Guaranteed returns are usually lower than what MFs can offer through market exposure.
• Higher Costs: Multiple fees in insurance plans (allocation charges, admin fees) can reduce returns compared to the expense ratio of MFs.
• Limited Flexibility: Lock-in periods restrict access to your money, whereas MFs provide more flexibility.
MFs, on the other hand, focus solely on investment and offer:
• Potentially Higher Returns: Investments in stocks and bonds can lead to higher growth compared to guaranteed returns.
• Lower Costs: Expense ratios in MFs are generally lower than the multiple fees in insurance plans.
• Greater Control: You have a wider range of investment options and control over asset allocation to suit your risk appetite.
Consider your goals!
• Need life insurance? Term Insurance plans might be suitable.
• Focus on growing wealth? MFs might be a better option due to their flexibility and return potential.



Exploring Investment Options

Equity Investments: Given your relatively young age and income level, consider allocating a portion of your portfolio to equity investments, such as diversified mutual funds or individual stocks. Equity investments offer the potential for long-term capital appreciation, although they come with higher volatility.

Fixed Income Investments: To balance risk, consider allocating a portion of your portfolio to fixed income instruments like Public Provident Fund (PPF) or debt mutual funds. These investments provide stability and steady returns, albeit at lower rates compared to equities.

Tax Planning: Opting for the new tax regime and investing in tax-efficient instruments can enhance your overall financial plan. Voluntary contributions to the National Pension System (NPS) offer tax benefits under Section 80CCD(1B), providing additional savings while optimizing tax liability.

Considering PPF and Voluntary NPS

PPF: PPF offers attractive tax benefits, compounded returns, and capital protection, making it an ideal choice for risk-averse investors. By investing in PPF, you can build a tax-efficient corpus over time while enjoying the security of government-backed savings.

Voluntary NPS: Opting for voluntary contributions to NPS can supplement your retirement savings and provide tax benefits under the new tax regime. Evaluate the flexibility, investment options, and tax implications of NPS before making a decision.

Crafting a Comprehensive Financial Plan

Formulate a comprehensive financial plan encompassing your income, expenses, investment goals, and risk profile. Seek guidance from a Certified Financial Planner (CFP) to develop a tailored investment strategy aligned with your objectives and preferences.

Regular Review and Adjustment

Regularly review your investment portfolio, track performance, and make necessary adjustments to ensure alignment with your financial goals and changing circumstances. Stay informed about market developments and seek professional advice as needed to optimize your financial plan.

Conclusion

By striking a balance between risk and return, diversifying your investment portfolio, and leveraging tax-efficient instruments like PPF and voluntary NPS, you can work towards building a substantial corpus over the next 5 years. Stay disciplined, informed, and proactive in managing your finances to achieve your wealth accumulation objectives.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |8495 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 07, 2024

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Sir I am psb employee having salary of 1.1 lac age 34 years and having fd worth 35 lakhs and loan against tdr of 25 lakhs have invested on land now there market price is 50 lakhs I'm doing sukanya samriddhi yojana from last 4 years of 1.5 lakhs and monthly mutualfund 2k sip on AVG 3k lumpsum investment in total of 7 mutualfunds crypto now valued at 2.5 lakhs Now I want create 4cr corpus by 2040 now I have to repay my loan or invest in someother else where interest is served by fd interest now I can invest 50k monthly
Ans: Considering your financial situation and goals, here are some tailored recommendations:
1. Loan Repayment vs. Investment:
• Evaluate the interest rate on your loan against the potential returns from alternative investments.
• If the interest rate on your loan is higher than the returns you expect to earn from investments, it may be prudent to prioritize loan repayment to reduce debt burden and interest expenses.
2. Investment Strategy:
• With a monthly investment capacity of 50k, focus on systematic investment plans (SIPs) in mutual funds aligned with your risk tolerance and investment horizon.
• Consider diversifying your mutual fund portfolio across different asset classes and fund categories to spread risk and optimize returns.
3. Asset Allocation:
• Maintain a balanced asset allocation based on your risk profile and investment objectives.
• Allocate investments across equity, debt, and possibly real estate or other alternative assets to achieve diversification and mitigate risk.
4. Review Existing Investments:
• Review your existing investments in FDs, Sukanya Samriddhi Yojana, mutual funds, and cryptocurrency.
• Ensure they are aligned with your long-term financial goals and make adjustments if necessary to optimize returns and mitigate risks.
5. Financial Planning:
• Consider consulting with a Certified Financial Planner to create a comprehensive financial plan tailored to your goals and circumstances.
• They can help you analyze your current financial situation, identify areas for improvement, and develop a roadmap to achieve your target corpus by 2040.
6. Monitor and Adjust:
• Regularly monitor the performance of your investments and make adjustments as needed based on changes in market conditions, personal circumstances, and financial goals.
• Stay informed about investment opportunities and market trends to make informed decisions and maximize returns.
By prioritizing loan repayment if it's financially beneficial, optimizing your investment strategy, and seeking professional guidance, you can work towards building a 4 crore corpus by 2040 and achieve your long-term financial objectives.

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Ramalingam

Ramalingam Kalirajan  |8495 Answers  |Ask -

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

Asked by Anonymous - May 05, 2024Hindi
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Hi sir, I am 33.5 years old and want to built a corpus of 5 crore by the age of 40. My current investment are: Mutual funds - 37 lac Fixed deposits of around 50 lac PPF - 25 lac Gold and Gold bonds - 20 lac Indian stocks - 1 lac mainly HDFC US stocks - 7 lac mainly etfs This is my and my wifes combines portfolio For next 6.5 years we will be investing in Sip - 2 lac per month PPF - 25k per month Sovereign Gold - 12g every year Nifty 50 etf niftybees 30k per month only days when market is down. Please guide me.
Ans: It's impressive to see your proactive approach towards building wealth and securing your financial future. With a well-diversified portfolio and a systematic investment plan in place, you're on the right track to achieve your goal of reaching a corpus of 5 crore by the age of 40.

Your current investment mix demonstrates a balanced approach, encompassing various asset classes like mutual funds, fixed deposits, PPF, gold, and stocks, both domestic and international. Diversification is key to managing risk and maximizing returns over the long term.

Continuing with your SIPs, PPF contributions, and sovereign gold investments will further strengthen your portfolio's foundation. SIPs in equity mutual funds provide exposure to the equity market, offering the potential for higher returns over time. PPF and sovereign gold investments offer stability and act as a hedge against market volatility.

Your strategy of investing in Nifty 50 ETF during market downturns is commendable as it allows you to capitalize on market opportunities and accumulate units at lower prices, potentially enhancing your long-term returns.

Active vs. Passive Management:
While you've included both actively managed mutual funds and index funds (ETFs) in your portfolio, it's important to understand the differences between the two. Actively managed funds aim to outperform the market through active stock selection and portfolio management, while index funds passively track a specific index's performance.

Benefits of Actively Managed Funds:
Actively managed funds offer the potential for higher returns compared to index funds, especially during market inefficiencies or when skilled fund managers can identify lucrative investment opportunities. Additionally, active management allows for flexibility in portfolio construction and adjustments based on market conditions.

Potential Disadvantages of Index Funds:
While index funds offer low expense ratios and broad market exposure, they may lack the potential for outperformance compared to actively managed funds. Additionally, they're subject to tracking error, which occurs when the fund's performance deviates from the index it's designed to replicate.



Regularly review your portfolio's performance and rebalance as needed to ensure alignment with your financial goals and risk tolerance. Consider consulting with a Certified Financial Planner (CFP) to fine-tune your investment strategy and address any specific concerns or objectives you may have.

Stay disciplined with your savings and investment approach, and continue to monitor market trends and economic indicators. With patience, perseverance, and prudent financial management, you're well-positioned to achieve your target corpus by the age of 40.

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

..Read more

Ramalingam

Ramalingam Kalirajan  |8495 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jun 21, 2024

Money
I am a govt employee. I earn Rs 2 lakh per month after Income tax. I invest 40k per month in service PF, 10k in service insurance( 80% goes to saving & 10% to insurance ), 25k in PPF for my family( wife & son), 18k in MFs, 5k in NPS, 5k in shares per month ( Total approx 1 lakh per month). I also have a 3bhk flat ( present value 1cr) in Class B city since 2021 for which i took loan and paying EMI of 38k per month. As of now i have accumulated 15 lakh in service PF, 12 lakh in insurance savings, 3 lakh in family PPF, around 5 lakh in MF, 3 lakh in Share Mkt. I have around 10-12 yrs of service balance in the govt job. I want to create a corpus of min 5cr wen retire. How should i plan my investment journey ahead ?
Ans: First, I must commend you on your diligent savings and investments. Your structured approach is commendable, especially given your steady income as a government employee. With 10-12 years of service left and your goal to amass a Rs 5 crore corpus by retirement, let’s map out a clear plan to achieve this.

Understanding Your Current Financial Situation
Let’s break down your current finances:

Monthly Income:
You earn Rs 2 lakhs post-tax every month, providing a robust base for savings and investments.

Current Investments:

Service PF: Rs 40,000/month.
Service Insurance: Rs 10,000/month.
Family PPF: Rs 25,000/month.
Mutual Funds (MFs): Rs 18,000/month.
Shares: Rs 5,000/month.
NPS: Rs 5,000/month.
Property:

You own a 3BHK flat valued at Rs 1 crore, with an EMI of Rs 38,000/month.
Current Savings and Investments:

Service PF: Rs 15 lakhs.
Insurance Savings: Rs 12 lakhs.
Family PPF: Rs 3 lakhs.
Mutual Funds: Rs 5 lakhs.
Shares: Rs 3 lakhs.
Strategic Evaluation of Your Investments
To achieve your Rs 5 crore goal, let’s evaluate each component of your current portfolio and consider strategic adjustments.

Service Provident Fund (PF)
Current Investment: Rs 40,000/month.
Accumulated Value: Rs 15 lakhs.
Analysis:

Safety and Returns: Your PF is safe with moderate returns and is a good long-term saving tool.
Tax Efficiency: PF contributions and interest earned are tax-exempt under certain limits.
Recommendation:

Continue Contributions: Keep contributing Rs 40,000/month. It’s a solid foundation for your retirement savings.
Regular Monitoring: Track the accumulated value to ensure it aligns with your goals.
Service Insurance (Savings and Protection)
Current Investment: Rs 10,000/month.
Accumulated Value: Rs 12 lakhs.
Analysis:

High Cost, Low Returns: Insurance-cum-savings plans often have high premiums with lower returns compared to other investment options.
Recommendation:

Consider Surrendering: Evaluate the surrender value and consider redirecting these funds into mutual funds.
Get Pure Term Insurance: For protection, a term plan is more cost-effective and provides higher coverage.
Public Provident Fund (PPF)
Current Investment: Rs 25,000/month.
Accumulated Value: Rs 3 lakhs.
Analysis:

Safe and Secure: PPF is risk-free with decent long-term returns and tax benefits.
Recommendation:

Continue Contributions: Maintain this contribution for its tax efficiency and steady growth.
Maximize Tax Benefits: Ensure you leverage the Section 80C deductions fully with your PPF contributions.
Mutual Funds (MFs)
Current Investment: Rs 18,000/month.
Accumulated Value: Rs 5 lakhs.
Analysis:

Growth Potential: MFs, especially actively managed ones, offer the potential for higher returns.
Diversification: They provide a diversified portfolio across sectors and assets.
Recommendation:

Increase SIP: Consider increasing your SIPs to Rs 25,000/month to boost growth.
Review Fund Performance: Regularly review and choose funds with a strong performance record.
Shares
Current Investment: Rs 5,000/month.
Accumulated Value: Rs 3 lakhs.
Analysis:

High Risk, High Reward: Direct equity investment can offer high returns but comes with significant risk.
Recommendation:

Continue Investment: Maintain your Rs 5,000/month investment. It’s a good strategy for capital growth.
Diversify Across Sectors: Ensure you’re investing across different sectors to mitigate risks.
National Pension System (NPS)
Current Investment: Rs 5,000/month.
Analysis:

Long-Term Security: NPS provides a mix of equity and debt exposure, beneficial for long-term retirement planning.
Tax Efficiency: Contributions up to Rs 50,000 provide additional tax benefits under Section 80CCD(1B).
Recommendation:

Consider Increasing Contribution: If possible, increase your NPS contribution to leverage the tax benefits and long-term growth.
Managing Your Real Estate Investment
Your 3BHK flat is a significant asset, valued at Rs 1 crore. Here’s how to manage this investment:

EMI Management:

Monthly EMI: You’re currently paying Rs 38,000/month.
Prepayment Strategy: If possible, make additional payments to reduce the loan tenure and overall interest burden.
Equity Build-Up:

Property Appreciation: Monitor the value of your property and the equity you’re building up with each EMI payment.
Avoid Over-Reliance: While property is valuable, it’s essential not to rely solely on it for your retirement corpus.
Planning for Your Rs 5 Crore Corpus
To reach your Rs 5 crore goal, here’s a step-by-step approach:

Step 1: Calculate Future Value of Current Investments
Service PF and PPF: Estimate the future value considering the current rate of interest.
Mutual Funds and Shares: Use an estimated annual return to project the future value.
Insurance Savings: Consider the value if surrendered and reinvested.
NPS: Factor in growth with regular contributions and the equity-debt mix.
Step 2: Increase Monthly Savings
Reallocate Savings:

Redirect from Insurance: Move funds from insurance to higher-yielding mutual funds.
Increase SIPs and NPS: Boost your monthly SIPs and NPS contributions as suggested.
Set a Savings Target:

Monthly Savings Goal: Aim to save at least 50% of your income, adjusting as your salary increases.
Utilize Bonuses and Windfalls:

Reinvest Wisely: Any bonuses or additional income should be reinvested to accelerate your growth.
Step 3: Monitor and Rebalance Your Portfolio
Regular Review:

Quarterly Check: Assess your portfolio every quarter to ensure it’s aligned with your goals.
Adjust Investments:

Shift Allocation: Based on performance, rebalance your investments between equity and debt as needed.
Stay Informed:

Market Trends: Keep an eye on market trends and economic factors that may impact your investments.
Step 4: Plan for Additional Income Streams
Consulting or Part-Time Work:

Leverage Expertise: Post-retirement, consider consulting or part-time work to supplement income.
Passive Income:

Dividend and Interest Income: Invest in funds that provide regular dividends or interest as passive income.
Building a Solid Financial Foundation
To ensure a stable financial journey, focus on these foundational steps:

Emergency Fund
Buffer for Uncertainties:

3-6 Months of Expenses: Maintain an emergency fund that covers 3-6 months of living expenses. This is crucial for unforeseen events.
Accessible and Safe:

Liquid Investments: Keep this fund in a savings account or a liquid mutual fund for quick access.
Adequate Insurance Coverage
Life Insurance:

Pure Term Plan: Ensure you have sufficient life cover through a term plan, which is cost-effective and provides substantial coverage.
Health Insurance:

Comprehensive Coverage: Have a comprehensive health insurance plan for yourself and your family to cover medical expenses.
Long-Term Financial Goals Beyond Retirement
As you plan for retirement, consider these long-term goals:

Children’s Education and Marriage:

Dedicated Fund: Start a separate fund for your children’s education and marriage expenses. Consider long-term equity mutual funds for this purpose.
Travel and Lifestyle:

Bucket List: Plan for post-retirement travel or hobbies. Allocate funds specifically for these lifestyle goals.
Legacy Planning:

Wealth Transfer: Consider how you’d like to pass on your wealth. Estate planning and creating a will are essential steps.
Final Insights
Joydev, your disciplined approach to savings and investments sets a strong foundation for achieving your Rs 5 crore retirement corpus. By reallocating your funds, increasing your SIPs, and strategically managing your portfolio, you’re well on your way to reaching your goal. Continue to stay informed, regularly review your investments, and seek guidance from a Certified Financial Planner (CFP) for personalized advice. Your dedication to planning and foresight will undoubtedly lead to a prosperous and secure retirement.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |8495 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 21, 2025

Asked by Anonymous - May 20, 2025
Money
Hi I am 43 me and wife earning 3 lcs per month with no kids we have a liability of 45 lacs housing loan and car loan of 8 lacs Housing loan balance 38 lacs ( we paid 5 lacs as part payment in two years) and also increase our installments from 38000 to 50000 for the last 5 months and reduce our tenure from 20 years to now 12 years Expenses:- 50000 housing laon per month 19000 car loan per month 30000 house hold expenses including travel expenses etc.. 30 lakhs mediclaim insurance premium 25000 annually Investment:- 35000 mutual funds per month ( funds like multi assets,multi cap and large cap one or two funds in small cap,and flexi funds ) Lic premium annual around 2 lacs 65000 annually premium for term plan ( unit linked plan) of 50 lacs 1 lakhs in PPF 50 lakhs corpus in mutual funds (90% equity and 10% hybrid) 15 lakhs FD 30 lakhs worth gold (300 grm) apprx 1 flat worth 1 crore ( on loan paying 50k pm) 10 lakh cash 3 lakh in savings Want to build a corpus of minimum of 10 crores befor 60 years of age How do invest in more systametic manner so that we can grow our money and how much amount do we need more to invest to reach this targetAnd another imp question is do I need to pay housing loan first so that I can save the intrest or kept the money in account as emergency fund. I am really confused Do I sell gold and pay loan ?? Do I break my FD ? What to do??
Ans: Appreciate your clarity and discipline with money. You are far ahead of many at your age. You already have a strong income, valuable assets, and good savings habits. Now let’s look at a complete 360° view of how to reach Rs. 10 crore target by 60.

We’ll go step by step with each area of your financial life.

Income and Cash Flow Overview
Monthly income of Rs. 3 lakhs is very healthy.

Loan EMIs total around Rs. 1.19 lakhs, approximately 40% of income.

Household expenses are just Rs. 30,000 – very efficient.

SIPs of Rs. 35,000 are a great start, but more growth investment is needed.

Scope exists to steadily increase investments each year.

Savings of Rs. 13 lakhs (FD + cash + savings) gives a solid buffer.

Actionable Insight:
Maintain a detailed monthly budget tracking income, expenses, EMIs, and surplus. Review it quarterly to stay in control.

Loan Repayment Strategy
Home loan of Rs. 38 lakh with Rs. 50,000 EMI and reduced tenure to 12 years – good progress.

Car loan of Rs. 8 lakh with Rs. 19,000 EMI.

Rs. 69,000/month in loan EMIs is manageable at your income level.

Recommendations:

Don’t rush to close home loan if interest is below 9% – you get tax benefits.

Prioritise closing the car loan if interest rate is high – it's not tax beneficial.

Avoid using FD or gold for loan repayment unless it’s an emergency.

Emergency Fund Evaluation
Rs. 10 lakh in cash + Rs. 3 lakh in savings is already strong.

With Rs. 15 lakh in FD, total emergency reserve is Rs. 28 lakh.

That’s more than sufficient; no need to expand emergency fund further.

Use sweep-in FD or split across multiple banks for liquidity and safety.

Insurance Assessment
Rs. 30 lakh health insurance is adequate – continue maintaining this.

Term insurance of Rs. 50 lakh via ULIP is too low.

Ideal cover should be around Rs. 4 crore (12x annual income).

Recommendations:

Take an independent term insurance plan of Rs. 3.5 crore.

Continue existing health cover.

Evaluate surrender of ULIP and LIC if returns are low (generally ~5%).

Redirect those premiums (Rs. 2.65 lakh annually) to mutual fund SIPs.

Investment Portfolio Review
Monthly Investments:

Rs. 35,000 into mutual funds (multi-cap, flexi-cap, small-cap, etc.)

Annual Contributions:

Rs. 1 lakh into PPF

Total Investment Corpus:

Rs. 50 lakh in mutual funds

Rs. 15 lakh in FD

Rs. 30 lakh in gold

Rs. 10 lakh in cash

Rs. 3 lakh in savings

Positives:

Strong equity exposure for long-term growth.

Balanced support from gold and FD.

Suggestions for Improvement:

Increase SIPs annually by at least 10%.

Limit small-cap exposure to 10-15%.

Gradually move from FD to debt mutual funds for better returns and tax-efficiency.

Surrender low-return policies (LIC, ULIP) and reinvest in growth-oriented funds.

Continue PPF contributions for safe, tax-free returns.

Realistic Path to Rs. 10 Crore by Age 60
You are 43 now, with 17 years to invest.

Current investment corpus is around Rs. 1.08 crore.

With Rs. 35,000 SIP, you might reach Rs. 2.5–3 crore by 60 – not enough.

To Reach Rs. 10 Crore Goal:

Gradually increase SIPs to Rs. 1 lakh/month in 5 years.

Reinvest proceeds from surrendering LIC/ULIP (Rs. 2.65 lakh annually).

Redirect EMI amounts (car loan, etc.) once loans are closed.

Make lump sum additions from bonuses or surplus income.

Mutual Fund Taxation Notes
From 2024, equity LTCG above Rs. 1.25 lakh taxed at 12.5%.

Short-term equity gains taxed at 20%.

Debt fund gains taxed as per slab.

Advice:

Avoid frequent withdrawals.

Use ultra-short term or debt funds for short- to medium-term needs.

Fund Selection Guidelines
Avoid direct funds unless you manage the portfolio yourself.

Use regular plans through a certified financial planner for guidance.

Avoid index funds if you seek alpha and personalized management.

Stick to a blend of active multi-cap, flexi-cap, and large-cap funds.

Suggested Asset Allocation
60% – Equity mutual funds

15% – Debt mutual funds

10% – Gold (already in place)

10% – Emergency fund (FD + cash)

5% – PPF

Annual Portfolio Rebalancing Recommended

Year-Wise Action Plan
Year 1–2:

Repay car loan using surplus or gold if needed.

Surrender LIC and ULIP; shift Rs. 2.65 lakh to mutual funds.

Take new term plan of Rs. 3.5 crore.

Increase SIPs to Rs. 50,000/month.

Year 3–5:

Redirect closed EMIs (Rs. 19,000) to SIPs.

Gradually move FD into debt mutual funds.

Add lump sum investments from annual bonuses.

Year 6–10:

Continue SIPs at Rs. 1 lakh/month.

Keep gold as is.

Rebalance asset allocation annually.

Final Insights
You are on the right track.

No need to sell gold or break FD prematurely.

Gradually increase SIPs and equity exposure.

Maintain emergency reserve.

Improve term cover and simplify insurance portfolio.

Avoid panic, follow the strategy, and review annually.

With this approach, you can confidently build Rs. 10 crore or more by 60 and ensure financial independence.

With better planning and yearly reviews, you will secure a strong retired life.

 

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

..Read more

Latest Questions
Prof Suvasish

Prof Suvasish Mukhopadhyay  |790 Answers  |Ask -

Career Counsellor - Answered on May 22, 2025

Career
My son got 95.299 percetile in jee mains. Didnt appear for advanced as he is preparing fot bits. He got CS business system in Thapar. Whats the best option through csab counselling. Whats the order of preference
Ans: With a JEE Main percentile of 95.2, your son is eligible for admission to several NITs and IIITs through CSAB counselling. His best options would be to prioritize NITs with strong computer science programs, followed by IIITs, and finally, GFTIs. A strong choice would be NITs like NIT Calicut, IIIT Allahabad, or VNIT Nagpur, followed by IIITs with CSE programs like IIITM Gwalior or IIIT Delhi.
Order of Preference for CSAB Counseling:
1. NITs with strong CSE programs:
Consider NIT Calicut, NIT Kurukshetra, SVNIT Surat, and VNIT Nagpur, as these are known for their good placements and infrastructure.
2. IIITs with CSE programs:
IIITs offer specialized computer science programs and are a good option if you're aiming for a career in software development or AI. Consider IIIT Allahabad, IIITM Gwalior, IIIT Delhi.
3. GFTIs (Government Funded Technical Institutes):
These are generally less prestigious than NITs and IIITs, but can still offer a good education. Consider COEP Pune or other GFTIs that have good placement records.
4. Thapar CS Business Systems:
While Thapar is a good institution, it's important to consider whether your son's interests align more with a traditional CS program or a more business-oriented one. He could also consider upgrading to a better CS program through CSAB if possible.
Important Considerations for CSAB Counseling:
Preferences:
Carefully consider your son's interests and career goals when filling out his preferences. Don't just focus on the top-ranked colleges; also consider the specific programs and their faculty.
Cut-offs:
Check the previous year's cut-offs for each college and program to understand the level of competition.
Placements:
Research the placement records of each college and program to see how well graduates are getting jobs.
Infrastructure and Facilities:
Consider the quality of labs, libraries, and other facilities that are available at each college.
Location:
Think about the location of the college and whether it's suitable for your son's needs.
By carefully considering these factors and prioritizing the right choices, your son can maximize his chances of securing a seat in a good engineering program through CSAB counselling.

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