I have received Rs 56 lac fixed deposit redemption after my father death. I want to use the about to buy house.It may take 6 month to 1 year. Meantime please advise me how to invest the money for short period of 6 month to 1 year.

Ans: . First of all, receiving Rs.?56 lakhs from your father’s fixed deposit is a significant financial event. You’re making a thoughtful move by not rushing into the property decision. Keeping the funds safe till you finalise your home purchase is very wise.

Let’s now understand how you can manage this amount well for the short term.

Emotional Stability First, Then Financial Action

This money carries emotional value too

Decisions should respect both heart and logic

Take time to grieve and settle emotions

Only then, act thoughtfully on this corpus

Avoid rushing into quick investments

This balance helps protect your peace and your capital.

Time Frame of Investment Clearly Stated

You want to buy a house

Likely in 6 months to 1 year

This is a short-term investment window

In short-term, safety is priority

Not returns, but capital preservation comes first

So, your investment should be low-risk and highly liquid.

Avoid High Risk Options Immediately

No equity funds, not even balanced funds

No options, futures, or direct equity

Avoid index funds—they follow the market without downside protection

Actively managed debt funds offer safer management

Avoid investing in direct funds on your own

Without expert support, decisions can go wrong

You don’t need volatility or uncertainty now.

Purpose of This Investment Must Guide Decision

This money is meant for home

Don’t mix it with other goals

Don’t lend this amount to anyone

Don’t lock it in long-term instruments

Don’t take tax-saving investment decisions here

Focus only on preservation and quick access

A clear purpose gives your investment direction and boundary.

Options for Parking the Funds Safely

Here are suitable low-risk, short-term options:

Ultra short-term debt funds

Suitable for 3 to 12 months

Low risk and better returns than savings

Very low volatility

Ideal if you need liquidity after 6 months

Low-duration mutual funds

Slightly better returns than FDs

Good for capital safety

Invest through regular plan via Certified Financial Planner

Liquid mutual funds

Extremely safe

Suitable for 1 to 6 months

Withdrawals processed in 24 hours

Useful if house booking is expected anytime soon

Bank fixed deposits (short term)

For very conservative part of capital

Park in 3–6 month FD

Stagger multiple FDs to break when needed

Sweep-in accounts or auto FD

Offers liquidity like savings

Gives FD-like returns on idle balances

Not ideal for large amounts

Use only for Rs.?2–5 lakhs portion

Keep mix simple, safe, and liquid.

How to Allocate the Rs.?56 Lakhs Properly

Here is a structured approach:

Rs.?20 lakhs – ultra short-term fund

Rs.?20 lakhs – low duration fund

Rs.?10 lakhs – liquid fund

Rs.?6 lakhs – bank FDs (staggered in 3 parts)

This gives you safety, liquidity, and mild returns

Revisit every 2 months with your CFP for adjustments.

Taxation Considerations

These are all debt instruments

If held less than 3 years, taxed per your slab

So, if you're in 20% tax slab, gains are taxed at 20%

No need to worry about long-term capital gain rules

Short-term funds offer better liquidity with taxable income

Withdraw only what is required, to avoid extra tax.

Maintain Separate Account for This Goal

Open a new savings account for home investment

Track only this Rs.?56 lakhs from that account

Don’t mix it with salary or daily expenses

Use the account for only home-related payments

This helps manage transactions better and avoid misuse.

Create a Digital Folder for Property Planning

Start researching properties passively

Make a folder for property papers, notes, contacts

Also track the movement of this Rs.?56 lakhs

Maintain basic Excel or written log

Record every transaction and interest earned

This gives you financial discipline and awareness.

Avoid Emotional Decisions and Peer Pressure

Don’t rush because relatives or friends push you

Don’t invest just because someone else did

Don’t go for real estate investments now unless house is finalised

House is a personal choice, not just an investment

Keep your vision and purpose clear.

Regular Review Every Month

Monitor your funds monthly

Check liquid fund NAV, returns

Track fund performance via MFD or CFP

Don’t keep all money in one place

Split between mutual funds and short FDs

Rebalancing is not needed here. But tracking is still essential.

Don’t Use This Corpus for Other Goals

Not for business

Not for education

Not for long-term SIPs

Not for gifting or lending

Keep this amount 100% focused on house purchase.

Liquidity is Non-Negotiable

Your investment must allow exit within 1–2 days

Emergency situations might arise

All selected products should be easily withdrawable

That’s why liquid and short-term funds fit best

This ensures money is ready when you need it.

Role of a Certified Financial Planner (CFP)

Choose regular mutual fund plans through CFP

Direct funds lack expert monitoring

CFP tracks market events and manages risks

Offers human touch and strategic rebalancing

Helps you remain calm during rate fluctuations

For short-term planning, this guidance is vital.

Future House Purchase Planning Tips

When ready to purchase, shift liquid funds gradually

Pay token amount from liquid fund

Move rest step-by-step during registration

Maintain Rs.?5–10 lakhs till last stage for surprises

Avoid locking full amount in builder advance

You stay in control by releasing money in steps.

If Delay Happens Beyond 1 Year

If house booking delays beyond 1 year

Shift from liquid funds to corporate bond or medium-duration fund

But only if 100% confident about extended timeline

Reconfirm with CFP before this shift

Flexibility should match your actual plan updates.

Finally

You have received a large amount from your father’s savings.
It’s a responsibility and an opportunity.
You are already doing the right thing by not rushing into property.
Short-term investment needs very safe, liquid and low-risk options.
Your Rs.?56 lakhs should be protected with care until home is finalised.
Use ultra short-term, liquid funds, and low-duration funds wisely.
Avoid equity, index funds, and direct market exposure now.
Invest only through regular plans with CFP to preserve capital.
Use the right mix of bank and mutual fund products for liquidity.
Once home is finalised, funds are easily moved to purchase.
Your plan is clear, smart, and already in the right direction.
Just stay focused, review monthly, and take action slowly with clarity.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment