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Can I Save My Job After Termination Without Notice Due to Leave?

Ramalingam

Ramalingam Kalirajan  |7101 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Aug 20, 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
Bibhanshu Question by Bibhanshu on Aug 12, 2024Hindi
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I passed out from IITDelhi &??????? from IIM Calcutta. I joined Cimmco New Delhi &worked for six years after Campus Placement from IITDelhi &later joined Industrial House for next 2decades. Can I save my job in Industrial House which terminated without information whereas I had sufficient leave to cover my absence. I claimed my full PF from employer without staying in job because of inhuman behaviour of employer because i was busy for treatment of Father -in-law during absence which I had informed to colleague cum past student in House. What to do with PF amount of approx 1crore after investing in son to finish his campus placentment from IITDelhi &so of my only daughter after losing my wife due to Covid19? ?? ???? ???

Ans: First, let me extend my heartfelt sympathies for the challenges you have faced. Losing your wife to COVID-19 and dealing with job termination without proper communication is deeply distressing. Additionally, supporting your children through their education and career is commendable. Now, let’s focus on managing your PF amount of approximately Rs. 1 crore and how to ensure your financial security moving forward.

1. Securing Education for Your Children
Prioritise Education: Your children’s education should be your top priority. Ensure that you allocate sufficient funds from your PF amount to cover their educational expenses, including fees, books, and living expenses.

Invest in Education Plans: Consider investing in education-specific mutual funds or child education plans. These plans are designed to provide growth and safety, helping you meet the financial requirements of your children’s education.

2. Building a Long-Term Corpus
Diversified Investment Portfolio: With Rs. 1 crore at your disposal, you have the opportunity to build a diversified investment portfolio. Consider a mix of equity mutual funds, debt funds, and fixed-income instruments. This will help you balance growth and safety.

Regular SIP Investments: Start a systematic investment plan (SIP) in mutual funds. SIPs offer the benefit of rupee-cost averaging and the power of compounding over time.

Avoid Real Estate: Given the uncertainty in the real estate market, it may not be the best investment option at this stage. Focus on more liquid and growth-oriented investments like mutual funds.

3. Creating an Emergency Fund
Emergency Fund Setup: Allocate a portion of your PF amount to create an emergency fund. This fund should cover 6-12 months of living expenses. Keeping this in a liquid fund or fixed deposit ensures that you can access it quickly if needed.

Health Insurance: Ensure that you and your children have adequate health insurance. With the loss of your wife, securing health coverage for your family is critical to avoid financial strain due to medical emergencies.

Planning for Your Future
1. Retirement Planning
Long-Term Investments: Invest a portion of the PF amount in long-term equity mutual funds. These funds provide growth potential, which is essential for building a retirement corpus.

Systematic Withdrawal Plan (SWP): As you approach retirement, consider setting up an SWP from your mutual fund investments. This will provide a steady income stream while keeping your capital invested.

2. Insurance Coverage
Life Insurance: With the loss of your spouse, you are the primary financial support for your children. Ensure you have adequate life insurance coverage to secure their future in case of any unforeseen events.

Health Insurance: Ensure that your health insurance coverage is sufficient for you and your children. Opt for a family floater plan with a top-up for added protection.

3. Estate Planning
Will and Nomination: Ensure that you have a will in place, clearly outlining how your assets should be distributed. Also, update nominations for all your investments and insurance policies.

Trusts and Guardianship: Consider setting up a trust or appointing a guardian for your children if something happens to you. This will ensure their financial security and well-being.

Final Insights
Sir, your dedication to supporting your children through their education while facing personal and professional challenges is admirable. The PF amount you have accumulated can be the foundation for a secure financial future. Focus on securing your children’s education first, then invest in diversified mutual funds for long-term growth. Legal recourse may be possible for your job termination, but it’s essential to consult a legal expert to explore your options. Prioritise your financial security and ensure that your investments align with your future goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.
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Krishna

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Workplace Expert - Answered on May 16, 2024

Asked by Anonymous - Apr 19, 2024Hindi
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Im 49 years old i worked as a teacher in a private unaided school in Telangana Medchal Mandal for the past 24 years.I started my career in teaching in this school since 1998 -2024 March 15. I was asked to quit the school since the new management wanted to have teachers according to their whims and fancies. I worked for her parents when the parents died the property was divided among her daughters finally the elder one cornered it she didn't want the old staff to work and wanted to appoint new staff. When my old correspondent (her mother) when we asked for PF she assured i can't insure right now because i should have done right at the inception of the school so i promise to pay good will when you leave the school for the service rendered towards the school unfortunately she too died in 2021 then her daughter present correspondent didn't even do any favour Unfortunate thing i worked for such an institution there i had not facilities of PF . I served so loyally for this institution as a token of gratitude to my service.they didn't pay anything. Finding a job in other institution they doubt over long standing experience in one school and owing my age they are hesitant to offer a job i have attended few interviews in school . I'm running pillar to post to find a job to support myself. Im helpless and desperate don't know what to do. Please help mem
Ans: Hello

I can understand what you must be feeling to go through this stage of life.

May I suggest you start with taking private tutions, given your rich experience in teaching I am sure you will make positive impact in the lives of students. Initially you may find it difficult ... but as you take steps...over the period a good path would be laid.

Believe in yourself...I am sure you will do it good.

All the best.

..Read more

Ramalingam

Ramalingam Kalirajan  |7101 Answers  |Ask -

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

Asked by Anonymous - May 26, 2024Hindi
Money
I am 55 years old and lost the job I have PF corpus amount of 1 . My plan is to withdraw whole my PF amount and join another company . But my question is it good option to withdraw PF or continue the PF account and join other company so that my PF account will be active pl advice
Ans: When faced with the decision of whether to withdraw your Provident Fund (PF) corpus upon job loss or to maintain your PF account by joining another company, it's essential to carefully weigh the pros and cons. This decision can significantly impact your financial well-being in the short and long term. Let's break down the key considerations to help you make an informed choice.

Understanding the Provident Fund
The Provident Fund is a crucial component of retirement savings in India. It offers tax benefits, regular contributions from both employee and employer, and a decent interest rate. Withdrawing the PF corpus can provide immediate liquidity, while keeping the PF account active can ensure continued growth and future security.

Advantages of Withdrawing PF
Immediate Financial Relief
Withdrawing your PF corpus can offer immediate access to a substantial sum. This can be particularly helpful if you face financial difficulties due to job loss. It can provide a cushion to manage expenses and maintain your lifestyle during the transition period.

Debt Repayment
If you have any outstanding debts or loans, withdrawing your PF can help you clear these liabilities. Reducing or eliminating debt can lower financial stress and improve your overall financial health.

Investment Opportunities
Accessing your PF corpus can allow you to explore new investment opportunities. You might consider investing in diverse financial instruments to potentially earn higher returns compared to the PF interest rate. However, this requires careful planning and understanding of investment risks.

Disadvantages of Withdrawing PF
Loss of Retirement Savings
Withdrawing your PF corpus means depleting a significant portion of your retirement savings. This can impact your financial security in your post-retirement years, especially if you don't have other substantial savings or investments.

Tax Implications
Early withdrawal of PF before five years of continuous service can attract tax liabilities. The withdrawn amount becomes part of your taxable income, which could increase your tax burden significantly.

Compounded Growth Loss
By withdrawing your PF, you lose the benefit of compounded growth on your savings. The PF interest rate, compounded annually, helps your corpus grow over time. Withdrawing the amount halts this growth, impacting your long-term savings.

Benefits of Continuing PF Account
Continued Compounded Growth
Keeping your PF account active allows your savings to grow with the power of compounding. Even if you join another company, your new employer's contributions, combined with your own, will continue to enhance your PF balance.

Financial Security
Maintaining your PF account ensures you have a dedicated retirement fund. This financial cushion can be crucial during your retirement years, providing a steady source of income when you are no longer earning a regular salary.

Employer Contributions
When you join a new company, both you and your employer will continue contributing to your PF. This not only increases your savings but also adds to your financial stability over time.

Considerations Before Making a Decision
Age and Retirement Plans
At 55 years old, your retirement is relatively close. Withdrawing your PF now could impact your retirement plans. Assess your retirement goals and determine if you have sufficient savings and investments to support your desired lifestyle post-retirement.

Current Financial Needs
Evaluate your immediate financial needs versus your long-term goals. If you have other savings or sources of income, it might be wiser to keep your PF account active. However, if you are in urgent need of funds, withdrawing might be necessary.

Job Prospects
Consider the stability of your next job. If you are confident about securing a stable job with a steady income, keeping your PF account active is beneficial. However, if there is uncertainty, having immediate access to your PF corpus might provide financial security.

Managing Your PF and Future Investments
Diversification
Whether you decide to withdraw your PF or keep it active, diversification of your investments is crucial. A balanced portfolio can mitigate risks and enhance returns. Consider a mix of equity, debt, and other financial instruments based on your risk tolerance and investment horizon.

Consulting a Certified Financial Planner
Engaging a Certified Financial Planner (CFP) can provide you with tailored advice based on your unique financial situation. A CFP can help you create a comprehensive financial plan, ensuring your short-term needs and long-term goals are balanced effectively.

Regular Review
Regularly reviewing your financial plan and investment portfolio is essential. Life circumstances and financial markets change, and your strategy should adapt accordingly. Periodic reviews with a CFP can help you stay on track.


Losing a job at 55 can be challenging, but it's commendable that you are taking proactive steps to secure your financial future. Your diligence in considering the best options for your PF corpus demonstrates a responsible approach to financial planning. Remember, every decision has its pros and cons, and it's important to choose what aligns best with your overall financial goals.

Conclusion
Deciding whether to withdraw your PF corpus or keep your PF account active upon joining another company requires careful consideration of various factors. While immediate withdrawal provides liquidity, it can impact your long-term financial security. Conversely, maintaining your PF account ensures continued growth and future financial stability. Assess your immediate needs, retirement goals, and job prospects before making a decision. Consulting with a Certified Financial Planner can provide valuable guidance tailored to your unique situation.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Latest Questions
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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Money
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.

...Read more

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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