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Ramalingam

Ramalingam Kalirajan  |7101 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 30, 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 - Apr 30, 2024Hindi
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Hi Sir, myself Prabhakar working as Asst Manager at PSU bank, 33 years old, salary 90,000/- gross in hand 60,000/- and 50 lakh saved money which is in Mutual Fund. Guide me to retire at 45 with Corpus of 5 Crore

Ans: Early Retirement Plan for Prabhakar (Age 33) - Reaching a ?5 Crore Corpus by Age 45
Retiring at 45 with a ?5 crore corpus is an ambitious goal, but achievable with a strategic and aggressive investment plan. Here's a roadmap to guide you, Prabhakar:

1. Analyzing Your Current Situation:

Savings: You have ?50 lakh invested in mutual funds and a monthly salary of ?60,000. This is a good starting point.
Time Horizon: You have 12 years (till age 45) to reach your target corpus.
Required Investment: To reach ?5 crore in 12 years, you'll need a high investment rate due to the short timeframe.
2. Investment Strategy:

High Equity Allocation: Considering your long investment horizon and risk tolerance (discuss risk tolerance with your advisor), a significant portion (70-80%) of your investments should be in equity mutual funds. Aim for diversified funds across market capitalization (large-cap, mid-cap, small-cap) and sectors.
Debt Allocation: Maintain a 20-30% allocation in debt instruments like PPF, EPF (if applicable), or low-risk debt funds for stability and emergency purposes.
SIPs and Additional Investments: Increase your SIP contributions significantly. Consider investing a substantial portion of your monthly salary (around ?40,000 - ?50,000) in equity SIPs. Explore lump sum investments (bonuses, inheritances) into equity funds for faster corpus building.
3. Aggressive Growth (High Risk):

Direct Equity: A small portion (5-10%) can be allocated to directly investing in high-growth potential stocks. This approach offers potentially higher returns but carries significant risk. Conduct thorough research before choosing individual stocks.
4. Important Considerations:

Risk Tolerance: This aggressive strategy involves a higher risk profile. Carefully assess your risk tolerance and comfort level with potential market fluctuations.
Market Volatility: Be prepared for market ups and downs. Stay invested for the long term to ride out market cycles and benefit from compounding.
Professional Guidance: Consulting a qualified financial advisor specializing in aggressive growth strategies can be highly beneficial. They can create a personalized plan considering your risk profile and investment goals.
5. Additional Tips:

Emergency Fund: Maintain a separate emergency fund (3-6 months of living expenses) to cover unexpected costs and avoid disrupting your retirement plan.
Debt Management: Clear any high-interest debt (credit cards, personal loans) to free up more funds for investments.
Lifestyle Management: Living frugally and minimizing unnecessary expenses allows you to save more and reach your target corpus faster.
Reaching a ?5 crore corpus by 45 is ambitious and requires a high-risk approach. It's crucial to understand the potential risks involved and ensure your comfort level with market volatility.

Remember, this is just a general guideline. Consulting a Certified Financial Planner for personalized advice based on your specific circumstances and risk tolerance is highly recommended.
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  |7101 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 19, 2024

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Hello Team, I am 39 yrs old and currently have 40 lakhs in mutual fund and doing a SIP of 1lakh 10 k monthly, i have shares around 15 lakhs and around 22 lakhs in crypto and 14 lakhs in PF. Currently i have 13 lakhs home loan, 4.5 lakhs car loan and also bought a new house where 1.9 cr loan will be taken. My plan is to sell the current house which will fetch me 1 cr so ideally 90 lakhs loan will remain in future. Please advise me how can i retire at 45 with corpus of 5 to 6 cr.
Ans: Frst, congratulations on building a substantial investment portfolio and planning for your financial future. Managing diverse investments and loans can be challenging, but with strategic planning, your goals are achievable.

Current Assets and Liabilities
Let's summarise your financial standing:

Mutual Funds: ?40 lakhs
SIPs: ?1.10 lakhs monthly
Shares: ?15 lakhs
Cryptocurrency: ?22 lakhs
Provident Fund (PF): ?14 lakhs
Home Loan (Existing): ?13 lakhs
Car Loan: ?4.5 lakhs
New Home Loan: ?1.9 crores (expected to reduce to ?90 lakhs after selling the current house)
Evaluating Your Retirement Goal
You aim to retire at 45 with a corpus of ?5 to ?6 crores. Given your current age of 39, you have six years to build this corpus.

Managing Existing Loans
Current Home Loan
You plan to sell your current house for ?1 crore, which will help reduce your new home loan to ?90 lakhs. This is a sound strategy to lower your debt.

Car Loan
The car loan of ?4.5 lakhs is relatively small. Consider paying it off early if possible, as this will reduce your monthly outflows and save on interest.

Investment Strategy
Mutual Funds and SIPs
You have ?40 lakhs in mutual funds and a monthly SIP of ?1.10 lakhs. This disciplined approach will significantly contribute to your retirement corpus.

Continue Your SIPs: Maintaining your SIPs is crucial. Consider increasing the SIP amount if your income allows, as this will accelerate your corpus growth.

Actively Managed Funds: Focus on actively managed funds with a consistent performance record. These funds aim to outperform the market and can help achieve your target returns.

Equity Investments
You have ?15 lakhs in shares. Equities can provide high returns over the long term, but they are volatile.

Diversification: Ensure your equity portfolio is diversified across sectors to manage risk.

Regular Review: Monitor your equity investments and rebalance your portfolio as needed to align with market conditions.

Cryptocurrency
Cryptocurrency investments worth ?22 lakhs are high-risk. While they can offer substantial returns, the volatility is significant.

Limit Exposure: Consider limiting your exposure to cryptocurrencies to avoid excessive risk.

Reallocate Gains: If there are substantial gains, consider reallocating some of these funds to more stable investments.

Retirement Corpus Calculation
Estimating Required Returns
To achieve a corpus of ?5 to ?6 crores in six years, you need to focus on high-growth investments while managing risks.

Compound Growth
Your existing investments and monthly SIPs will grow significantly due to compounding. Here’s a simplified approach:

Mutual Funds and SIPs: With aggressive and balanced mutual funds, aim for an annualised return of 12-15%.

Equities and Crypto: While high-risk, these can offer returns above 15%, but exposure should be managed carefully.

Debt Management
Reducing Loan Burden
Pay Off Small Loans: Clear the car loan and any other small debts to reduce financial stress.

New Home Loan: Focus on prepaying the new home loan. Reducing this loan early will significantly lower your interest burden and increase disposable income for investments.

Professional Guidance
Consulting a Certified Financial Planner (CFP) can help tailor your investment strategy. A CFP can provide personalised advice, monitor your portfolio, and make necessary adjustments.

Regular Monitoring and Rebalancing
Review Portfolio: Regularly review your investment portfolio to ensure alignment with your retirement goals.

Rebalance Investments: Periodically rebalance your investments to manage risk and optimise returns.

Conclusion
With disciplined investing, strategic debt management, and professional guidance, retiring at 45 with a corpus of ?5 to ?6 crores is achievable. Focus on high-growth investments, manage risks, and regularly review your portfolio to stay on track.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |7101 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jun 19, 2024

Asked by Anonymous - Jun 19, 2024Hindi
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My age is 33. In hand salary 65k. With loan of 8lakh and single. I have Mutual fund of 1.5 lakh . i want to retire at age of 50
Ans: It's great to see you planning for your future. At 33, you have ample time to build a solid retirement corpus by 50. Let's delve into a comprehensive strategy for you.

Understanding Your Current Financial Situation
Income and Loans

In-hand salary: Rs. 65,000 per month.
Existing loan: Rs. 8 Lakhs.
Mutual fund investment: Rs. 1.5 Lakhs.
Your income is steady, but the loan needs attention. Let's plan effectively to balance debt repayment and investment growth.

Building a Strong Financial Foundation
1. Managing Your Loan

Start by focusing on repaying your Rs. 8 Lakhs loan. Allocate a portion of your income to accelerate loan repayment. This will reduce interest burden and free up funds for investments.

Emergency Fund Creation
2. Establish an Emergency Fund

Maintain an emergency fund equivalent to 6-9 months of your monthly expenses. This fund should be easily accessible, kept in a savings account or liquid mutual fund.

Strategic Investment Planning
3. Increase Mutual Fund Investments

Mutual funds are a great tool for wealth creation. Considering your goal to retire by 50, you'll need to invest more aggressively in equity mutual funds for higher returns.

Monthly Investment Allocation
4. Diversify Your Investments

Allocate your monthly investments wisely. Here's a suggested plan:

Equity Mutual Funds: Rs. 30,000
Debt Mutual Funds: Rs. 10,000
Balanced/Hybrid Funds: Rs. 5,000
This allocation balances growth potential and risk management.

Reviewing Existing Mutual Funds
5. Assess and Realign Your Portfolio

Review your existing mutual fund portfolio. Ensure it includes a mix of large-cap, mid-cap, and small-cap funds. If necessary, consult with a Certified Financial Planner to realign your portfolio.

Setting Up Systematic Investment Plans (SIPs)
6. Consistent SIPs for Growth

Set up SIPs in the chosen mutual funds. SIPs help in averaging out market volatility and instilling financial discipline. Increase SIP amounts annually by 10-15% to match inflation and income growth.

Debt Management and Savings Balance
7. Prioritize High-Interest Debt Repayment

Focus on repaying high-interest debt first. Once the Rs. 8 Lakhs loan is cleared, reallocate that amount towards your investments.

Exploring Additional Investment Avenues
8. Alternative Investments for Diversification

While equity and debt funds are primary, consider a small allocation in gold funds or international mutual funds for added diversification.

Insurance and Risk Management
9. Adequate Insurance Coverage

Ensure you have sufficient health insurance and life insurance coverage. This protects your investments from being eroded by unforeseen medical expenses or financial hardships.

Tax Planning and Efficiency
10. Tax-Efficient Investments

Utilize tax-saving instruments like ELSS funds under Section 80C to reduce your tax liability. Plan withdrawals and redemptions strategically to minimize taxes.

Regular Monitoring and Adjustments
11. Annual Portfolio Review

Review your portfolio annually with a Certified Financial Planner. Rebalance as needed to maintain your desired asset allocation and risk tolerance.

Financial Discipline and Patience
12. Focus on Long-Term Goals

Stick to your long-term investment strategy despite market volatility. Regular investments and compounding will work in your favor over time.

Professional Guidance and Support
13. Engage with a Certified Financial Planner

Work with a CFP to tailor your investment strategy to your specific needs and goals. They can provide personalized advice and regular reviews.

Building a Retirement Corpus
14. Estimating Retirement Needs

Calculate your retirement corpus based on your expected monthly expenses post-retirement. Factor in inflation to arrive at a realistic figure.

Lifestyle and Budgeting
15. Budgeting for Lifestyle Needs

Plan your current and future lifestyle needs. This helps in setting realistic financial goals and ensures your corpus lasts throughout retirement.

Final Insights
By systematically increasing your investments, managing debt efficiently, and leveraging professional advice, you can achieve your retirement goal by 50. Discipline, patience, and regular reviews are key to staying on track.

Best Regards,

K. Ramalingam, MBA, CFP

Chief Financial Planner

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |7101 Answers  |Ask -

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

Asked by Anonymous - Jul 18, 2024Hindi
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Hi sir, I am 35years old.i have 5year old son.my salary and my wife it's 120000, Total medical insurance is 20lack. Pf 9000 per month mutual fund 11000 per month and I have a flat of 65lack.i want to retire at 50.
Ans: Current Financial Situation
Income: Combined salary of Rs 1,20,000 per month.

Medical Insurance: Coverage of Rs 20 lakhs for your family.

Provident Fund: Rs 9,000 per month.

Mutual Fund Investment: Rs 11,000 per month.

Property: Own a flat valued at Rs 65 lakhs.

Son's Age: 5 years old.

Retirement Planning
Goal: Retire at age 50. This gives you 15 years to build a retirement corpus.

Corpus Needed: You need a substantial corpus to sustain post-retirement. This includes living expenses, medical needs, and inflation.

Investments Assessment
Provident Fund: Stable and secure. Continue contributing.

Mutual Funds: Good choice for long-term wealth creation. Ensure you have a diversified portfolio.

Property: Avoid considering it as a liquid asset for retirement. Focus on financial instruments instead.

Increasing Investments
Enhance SIPs: Increase SIP contributions gradually. Aim for a higher monthly investment.

Equity Exposure: Ensure a good mix of equity mutual funds. Equity offers higher returns over the long term.

Debt Funds: Balance your portfolio with some debt funds for stability.

Insurance Review
Medical Insurance: Rs 20 lakhs is decent coverage. Review it periodically to ensure it meets future needs.

Life Insurance: Ensure adequate life cover. Consider term plans for sufficient coverage.

Education Fund for Son
Higher Education: Start a dedicated fund for your son's higher education. Education costs will rise significantly.

Investment Options: Use a mix of child plans and mutual funds to build this corpus.

Reducing Debt
Home Loan: If you have a home loan on your flat, plan to repay it before retirement.

Debt-Free Retirement: Aim to enter retirement without any liabilities.

Professional Guidance
Certified Financial Planner: Consult a Certified Financial Planner for a detailed plan. They can help you balance risk and return.

Regular Reviews: Periodically review your financial plan. Make adjustments based on life changes and market conditions.

Final Insights
Consistent Savings: Regular and disciplined savings are key to achieving your goals.

Balanced Portfolio: Maintain a balanced portfolio to manage risks.

Focus on Long-Term: Keep a long-term perspective for investments. Avoid short-term market fluctuations.

Emergency Fund: Ensure you have an emergency fund. It should cover at least 6 months of expenses.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Anil

Anil Rego  |377 Answers  |Ask -

Financial Planner - Answered on Jul 31, 2024

Asked by Anonymous - Jul 30, 2024Hindi
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Nayagam P

Nayagam P P  |3918 Answers  |Ask -

Career Counsellor - Answered on Nov 24, 2024

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Sir i am currently in class 11 th and i just want to prepare for jee mains and advanced 2026 exam so give me some roadmap to achieve and also guide me for computer science
Ans: Shreya, I trust that you have already enrolled in a coaching center, whether it be online or in person, and have finished your eleventh syllabus. (1) If you have not yet created your own short-notes for the 11th syllabus that has been completed, prepare it and continue to revise them every three days until 2026, even after you have commenced studying the 12th syllabus in December 2024. (2) Review the questions that you have incorrectly answered or skipped in mock tests conducted by your Coaching Center and/or practiced independently. (3) In order to increase your rank/percentile by targeting computer science at a reputable college/institute, prioritize mathematics (although all three subjects are equally important). (4) You should be thorough with NCERT books, particularly those pertaining to chemistry, in conjunction with the materials provided by your coaching institute. (5) Have 1-2 reference books for each subject. Not exceeding two. (6) Review the questions that were incorrectly answered or skipped in your mock and practice exams and retake the test. It is advisable to maintain a distinct note-book for these types of questions, which should include answers and elucidating notes, in order to review them repeatedly for all three subjects. (7) Download the SYLLABUS of JEE Main 2025 (available on Google by searching for "JEE Main Information Bulletin") and print it out, as there will be no significant changes to the syllabus in 2026. Maintain it on your study table and continue to update the 11th syllabus chapters and concepts that you have covered to date by marking them with a checkmark. This will boost your confidence if you continue to update the same till November 2025. (8) A slight difference in Syllabus might be visible when you acquire the 2026 JEE Main / JEE Advanced Syllabus. The same can be resolved within 15 days to one month in 2025-26. (9) Increase your productivity by studying for 45 minutes to 1 hour, taking a 10-minute break, and then continuing for 45 minutes. (10) Take a 2-3 minute break every 45 minutes while practicing questions, whether offline or online. This break should consist of closing your eyes and taking long breaths to enhance your concentration and mental capacity. (11) Additionally, it is recommended that you acquire the 20-40 PREVIOUS years question paper book of JEE (Main & Advanced) from Amazon. Arihant's, Disha's, or MTG's publications are recommended. Once you have finished reading a chapter, practice and complete it to determine the extent to which you have comprehended the concepts and to identify areas that require improvement. (12) By October 2025, ensure that you have reviewed significantly more than 90% of the previous years questions. Your confidence will be further bolstered by this. (13) After the mock test is completed at your coaching center, clarify all incorrectly answered or ignored questions and continue to revise and practice them, as these types of questions will significantly disrupt your performance in the actual JEE. (14) If you are a regular school student, inquire with your class teacher about the minimum attendance requirement as outlined in the Board's regulations (State, CBSE, ICSE, etc.). Utilize the remaining 15% by taking time off and preparing for your JEE, if only 85% attendance is required. (15) THE MOST IMPORTANT Value Added Suggestion: Rather than solely relying on JEE, please participate in 5-7 entrance exams/counseling process with a JEE score for getting admission into any one of the private engineering colleges to have a variety of options to select the most suitable one. All the BEST for Your Prosperous Future.

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T S Khurana

T S Khurana   |197 Answers  |Ask -

Tax Expert - Answered on Nov 23, 2024

Asked by Anonymous - May 11, 2024Hindi
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Can you please suggest on capital gains as per Indian taxation laws arising in the below two queries : 1) property purchased with joint ownership, me and my wife’s name in 2015 at a cost of 64,80,000, housing improvements done for the cost of 1000000 and brokerages of 200000 paid and sold the same property at 10000000 in Dec 2023? 2) 87% of the proceeds got from the deal i.e 8700000, have been reinvested to pay 25% amount in purchasing another joint ownership property in Dec 2023, 3) I have invested in another under construction property in Nov 2023 by taking housing loan, which is on me and my wife’s name worth 1.4 cr, here the primary applicant is me only while wife is just made a Co applicant in the builder buyer agreement and also on the housing loan . So what are the LTCG tax liabilities arising from the above 3 scenarios for FY 2023-2024 and FY 2024-2025. I intend to sale off the property acquired in (2) by Dec 2024 and use that proceeds to close the housing loan for the property acquired in (3), will this sale of property be inviting any tax liabilities if the complete proceeds received from the sale of the property in (2) would be utilised to close the housing loan taken in Nov 2023 for the property in (3) ? Since in FY 23-24, I would be claiming the LTCG from the sale proceeds of 1) invested in the purchase of property in 2), and I intend to sale off this property in Dec 2024, will the LTCG claim be forfeited on the property sale in (1), should I hold this property at least for further 1 year so that sale of this property in 2) will not invite STCG?
Ans: (A). Let's first talk about F/Y 2023-24 :
You jointly sold a Property during the year for Rs.76.80 lakhs (64.80+10.00+2.00), & sold the same for Rs.100.00 lakhs.
You have jointly also purchased Property No.3 (I suppose it is Residential only), for Rs.140.00 lakhs.
You should avail exemption u/s-54 & file your ITR accordingly. Please disclose all details about sale & purchase in your ITR.
02. Now coming to the F/Y 2024-25 :
You intend to Sell Property No.2, which was acquired in 2023-24. Any Gain on Sale of it would be Short Term capital Gains & taxed accordingly.
Alternatively, you may hold this sale of property no.2 (for 2 years from its purchase) & avoid STCG
You are free to utilize the sale proceeds in a way you like, including paying off your housing Loan.
Please note to avail exemption u/s 54 only from investment in property no.3 & not 2.
Most welcome for any further clarifications. Thanks.

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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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