Home > Money > Question
Need Expert Advice?Our Gurus Can Help

20-year old with stipend and 10 LPA offer: How can I save and invest for maximum return?

Ramalingam

Ramalingam Kalirajan  |9924 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Nov 26, 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 - Nov 20, 2024Hindi
Listen
Money

I’m a 20yr old student , currently doing internship and getting stipend of 30k, going to get package of 10LPA in 6 months. I want to save money and also get atleast minimal returns. I’ve very less idea about share market also. How can I save money and create a plan for me to save max and also get maximum returns.

Ans: You are at an ideal stage to start building wealth. Your internship stipend and future salary provide a strong foundation. With structured planning, you can save and earn better returns while managing risks. Let’s create a simple, actionable strategy for you.

Setting Clear Financial Goals
Short-Term Goals (1–3 Years):
Emergency fund, higher studies, or any immediate personal goals.

Medium-Term Goals (3–5 Years):
Buying a vehicle, planning vacations, or career enhancement expenses.

Long-Term Goals (5+ Years):
Buying a home, retirement savings, or wealth creation.

Creating an Emergency Fund
Importance of Emergency Fund:
Build a fund equal to 6 months' expenses. It provides financial stability during unexpected situations.

Where to Invest:
Use a mix of liquid mutual funds and high-interest savings accounts for easy access.

Budgeting Your Income
Stipend Allocation Plan:
Save at least 40–50% of your Rs 30,000 stipend. The rest can cover expenses and small indulgences.

Future Salary Planning:
After getting the Rs 10 LPA package, aim to save 30–40% monthly.

Investing in Mutual Funds for Returns
Equity Mutual Funds for Growth:
Equity funds are ideal for long-term wealth creation. Actively managed funds offer better growth than index funds due to expert management.

Systematic Investment Plan (SIP):
Start SIPs to invest consistently. Begin with Rs 5,000–10,000 based on affordability.

Avoid Direct Funds:
Regular plans with a Certified Financial Planner provide better guidance and monitoring.

Tax-Saving Investments
Utilise Section 80C:
Invest up to Rs 1.5 lakh annually in tax-saving instruments like ELSS mutual funds.

Consider NPS for Retirement:
NPS offers tax benefits under Section 80CCD. It also builds retirement wealth gradually.

Staying Cautious with Stocks
Learn Before Investing in Shares:
Direct stock market investing requires knowledge. Avoid risky investments until you gain expertise.

Start Small with Blue-Chip Companies:
If you wish to explore stocks, invest small amounts in reliable, large-cap companies.

Exploring Debt Instruments
Invest in Debt Mutual Funds:
Debt funds offer stability and are tax-efficient for your income bracket.

Avoid Over-Reliance on Fixed Deposits:
Fixed deposits provide safety but offer lower returns compared to mutual funds.

Managing Risks
Insurance for Protection:
Get health insurance for yourself. It ensures financial stability during medical emergencies.

Avoid ULIPs or Endowment Policies:
These provide low returns compared to mutual funds. Focus on term insurance when needed.

Tax Planning with New Income
Understand Tax Slabs:
With a Rs 10 LPA salary, you will fall in the 20–30% tax bracket.

Plan for Deductions:
Use Section 80C, 80D (health insurance), and other exemptions to minimise taxable income.

Steps to Monitor and Adjust
Review Portfolio Regularly:
Evaluate your investments every 6 months. Adjust as per market conditions and goals.

Increase SIP Amount Gradually:
As your income grows, increase your SIP contributions to grow wealth faster.

Final Insights
Starting early gives you a significant advantage in wealth creation. Focus on disciplined saving and investing with a mix of equity and debt funds. Avoid unnecessary risks and prioritise financial security through insurance and emergency funds. Monitor and adjust your portfolio regularly to stay aligned with your goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

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

You may like to see similar questions and answers below

Ramalingam

Ramalingam Kalirajan  |9924 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 09, 2024

Listen
Money
i am Working as a sales head 12,00,000 Per Annum CTC so Im Invested 1,50,000=00 in ELSS SIP,Monthly rent 24,000=00 and Medical Insurance 26,550==00 So please Suggest minimum TDS how to save
Ans: You cannot directly control the TDS (Tax Deducted at Source) that your employer deducts from your salary. However, you can certainly minimize your tax liability by claiming various deductions and exemptions offered by the Income Tax department. Here's what you can do:

Submit Investment Proofs: Ensure you submit Form 16C to your employer reflecting your ELSS investment of Rs 1,50,000. This will help them adjust the TDS deducted throughout the financial year.

HRA Exemption: If you are paying rent, claim the House Rent Allowance (HRA) exemption as per your rent agreement. You can claim the least of these:

Actual HRA received
50% of your salary (for metro cities) or 40% (for non-metro cities)
Actual rent paid minus 10% of your salary
Medical Insurance: The premium paid for your medical insurance (Rs 26,550) is deductible under Section 80D. Submit the premium payment receipts to your employer for claiming this deduction.

By claiming these deductions, you can significantly reduce your taxable income, which will in turn minimize your overall tax liability.

Additional Tips:

You can explore other deductions under sections like 80C (children's education fees, etc.) or 80G (charitable donations) if applicable.
Talk to a tax advisor for personalized advice based on your specific circumstances. They can help you optimize your tax deductions and filing strategy.
Remember, proper tax planning can help you save money and make your investments more efficient.

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

..Read more

Ramalingam

Ramalingam Kalirajan  |9924 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Oct 23, 2024

Asked by Anonymous - Oct 23, 2024Hindi
Money
Dear Sir, I am 24 years old, currently earning a monthly in-hand salary of 25,000 rs. I don't have any emergency fund as of now. Doing an SIP of 500 rs, ( since 9 months) a recurring deposit of 2000 rs ( since a month) and investing some money in stocks. (since 8 months ) I also send some money to my parents for their needs. I have a loan of 30,000 rs . Could you please guide me how to save money and use money efficiently ?
Ans: At 24, you're already investing in SIPs, a recurring deposit, and stocks. This is a good start. You also support your parents, which is admirable. However, you currently lack an emergency fund and have a Rs 30,000 loan. Let’s explore how to manage your finances efficiently while building a secure future.

Creating an Emergency Fund
Your top priority should be building an emergency fund. This fund will act as a cushion for unexpected expenses, like medical emergencies or job loss. Without it, you may have to rely on loans or liquidate investments.

Ideally, aim to save 3 to 6 months of your expenses in this fund. Start small by setting aside Rs 1,000 to Rs 2,000 per month.

Keep this fund in a savings account or a liquid mutual fund for easy access. This will ensure your money grows while remaining accessible in case of emergency.

Clearing Your Loan
You have a loan of Rs 30,000. It’s important to clear this as soon as possible to free yourself from debt. Prioritize paying off this loan before increasing your investments.

Dedicate a portion of your income toward repaying this debt, even if it means temporarily lowering your investment amounts.

Paying off debt quickly saves you money on interest, which you can then redirect towards investments.

Balancing Investments with Savings
Once your emergency fund and loan are under control, focus on increasing your investments. Your current SIP of Rs 500 is a good start but increasing it over time will help you build wealth faster.

You are also investing in stocks, which can offer high returns but come with risk. It's important to balance this with stable investments like mutual funds to diversify your portfolio.

You can consider redirecting some money from the recurring deposit towards mutual funds for better long-term growth. Actively managed mutual funds, in particular, can help you benefit from professional expertise.

Avoid Direct Funds
If you are considering direct mutual funds, remember that they may not be suitable for everyone. Without expert advice, you could choose funds that don’t match your financial goals or risk profile.

Investing through a Certified Financial Planner (CFP) or Mutual Fund Distributor (MFD) ensures you get tailored advice. Regular mutual funds give you access to this expertise, which is worth the slightly higher expense ratio.

Allocating Your Monthly Income
With a salary of Rs 25,000 and after supporting your parents, you still have room to save and invest. Once your loan is cleared and your emergency fund is set, aim to allocate around 30% of your salary to investments.

Start by increasing your SIPs over time, gradually moving from Rs 500 to Rs 2,000 or more per month. SIPs offer the benefit of rupee cost averaging, which reduces the risk of market volatility over the long term.

Systematic Investment Plan (SIP) Benefits
SIPs are a disciplined way to invest. By investing a fixed amount every month, you buy more units when prices are low and fewer when prices are high. Over time, this can yield significant returns.

Actively managed mutual funds offer better growth potential than passive options like index funds, as fund managers make informed decisions to optimize returns.

Continue with your SIP and gradually increase your contribution as your income grows.

Controlling Expenses and Budgeting
Since you’re sending money to your parents and also paying off a loan, it’s important to track your expenses. Keep your spending minimal, focus on needs over wants, and try to save more each month.

Creating a simple budget can help you manage your expenses and ensure you are saving and investing consistently.

Avoid Overexposure to Stocks
Stocks can be volatile, and putting too much money into individual stocks can expose you to risk. It’s better to have a diversified portfolio with exposure to different asset classes.

Mutual funds provide a good balance between risk and reward. They also spread your money across multiple companies, reducing the risk compared to investing in individual stocks.

You can continue investing in stocks, but limit it to a small portion of your portfolio while focusing more on mutual funds.

Tax Benefits of Investments
SIPs in mutual funds, especially in tax-saving schemes like Equity-Linked Savings Schemes (ELSS), can provide tax benefits. ELSS allows you to save on taxes while growing your wealth through equity exposure.

These funds come with a lock-in period of 3 years but offer better returns compared to traditional tax-saving options.

Use the tax benefits to your advantage while ensuring your investments are aligned with your long-term goals.

Health Insurance as a Safety Net
While you are young and healthy, it’s still important to consider getting health insurance. Medical expenses can drain your savings quickly, and having insurance ensures you don’t have to use your emergency fund or investments for healthcare costs.

Even a basic health insurance plan will provide peace of mind and protect your finances from unexpected medical bills.

Reviewing Your Financial Plan Regularly
It’s essential to review your financial plan at least once a year. As your income increases, your financial goals may change, and you will need to adjust your investments accordingly.

A Certified Financial Planner can help you make the right choices based on your changing needs and risk tolerance.

Finally
You’re in a good position to build a strong financial future. Focus on creating an emergency fund, paying off your loan, and gradually increasing your investments.

Diversify your investments to balance risk and reward, and take advantage of tax-saving opportunities.

Health insurance and a disciplined approach to saving and investing will ensure you stay on track to meet your financial goals.

Best Regards,

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

..Read more

Latest Questions
Nayagam P

Nayagam P P  |9650 Answers  |Ask -

Career Counsellor - Answered on Jul 29, 2025

Career
Is joining Jaypee guna for btech cse worth it or not
Ans: Vibhuti, Jaypee University of Engineering and Technology (JUET) Guna, accredited with NAAC ‘A+’ and recognized by UGC and AICTE, delivers a well-structured B.Tech CSE program on a 100-acre campus featuring modern hostels, high-speed connectivity, extensive labs, dedicated faculty (90% with PhDs from renowned institutes), and strong student-centric support systems. Placement rates for CSE consistently lie between 90% and 96% over the past three years, with leading recruiters like Amazon, Infosys, TCS, Capgemini, and Wipro offering diverse roles; top campus packages can be very high, though most offers are at the 5–7 LPA range, and the placement process is generally smooth. The infrastructure is frequently praised for its contemporary classrooms, green campus, and robust amenities—including a 24/7 library, gyms, and strong security. Students highlight an active, fun campus life and regular opportunities for internships, while also noting the academic environment as structured but not overly intense, making it suitable for average learners seeking guided growth. Among experiences, some mention that while the bulk of placements are from mass recruiters, competitive students with strong skills benefit most, and those less proactive may need to depend on off-campus job searches. Hostel and mess quality meet expectations, with limited complaints overall. Slight drawbacks cited include relative geographic isolation (which affects daily commuting for day scholars) and less global visibility compared to tier-1 engineering colleges, though industry exposure on campus is robust. All five institutional essentials—national accreditation, qualified faculty, modern infrastructure, active placement cell, and comprehensive student support—are well addressed, making CSE at Jaypee Guna an attractive, value-for-money option within the private engineering sector.

RECOMMENDATION: Jaypee Guna is a solid choice for B.Tech CSE, owing to its consistent 90–96% placement rates, A+ accreditation, experienced faculty, advanced facilities, and supportive campus environment. It is well suited for students seeking quality education and reliable placements, provided they remain engaged and proactive during their degree. All the BEST for a Prosperous Future!

Follow RediffGURUS to Know More on 'Careers | Money | Health | Relationships'.

...Read more

Nayagam P

Nayagam P P  |9650 Answers  |Ask -

Career Counsellor - Answered on Jul 29, 2025

Career
Sir, my son with CLR 41700 i Gen Category for CSE(Cyber Security) at IIIT Kalyani WB in JoSSS. He may get Kurnool and Sonipat. He has been alloted seat in CSE ( AI& ML) in Nirma University. Pl advise what to do. We already have registered imfor CSAB. Chirag R Patel
Ans: Chirag Sir, Your son’s options—CSE (Cyber Security) at IIIT Kalyani, potential CSE offers from IIIT Kurnool and IIIT Sonepat, and confirmed CSE (AI & ML) at Nirma University—each come with distinct advantages and considerations. IIIT Kalyani, established in 2014 and an Institute of National Importance, has rapidly built a reputation in IT education, especially in next-generation fields like cyber security. The latest data indicate an 89.33% placement rate for B.Tech CSE in 2024, with an average package of ?10.72 LPA and strong industry ties to top recruiters. The campus offers solid infrastructure, adaptive curriculum, and an emerging alumni network. IIIT Kurnool, a newer IIIT, posts placement rates in the 59–68% range for CSE, with average packages roughly ?8–10.8 LPA. It offers a research-led environment and industry engagement, but its relative institutional youth results in fewer recruiters and a nascent peer/alumni network. IIIT Sonepat, also government-recognized, recorded a 70.7–81.6% CSE placement rate recently, with average packages near ?14 LPA and recruiters including Amazon, Microsoft, and prominent startups. However, students report variation in infrastructure and placement consistency as the institute is still growing. Nirma University’s Institute of Technology, reputed as a private leader with NAAC A+ and NBA-accredited courses, posts an impressive 90–96% CSE placement rate, a well-established alumni base, and robust average packages (?8–10 LPA). The AI & ML CSE program is industry-focused, the faculty is predominantly PhD-qualified with solid teaching reviews, and campus facilities are modern and student-friendly, with strong internship culture and high conversion of internships to pre-placement offers. All four institutions meet critical priorities of accreditation, qualified faculty, infrastructure, curriculum innovation, and professional placement mechanisms. The CSAB counseling process remains highly relevant—if your son seeks further rounds at core NITs, top IIITs, or premium state instititutes, it is prudent to keep those options open, as seat movement is common in the special rounds.

RECOMMENDATION: In order of preference, IIIT Kalyani CSE (Cyber Security) is the top choice for its excellent placement rate, specialized track, and growing reputation in information security, followed by Nirma University CSE (AI & ML) for its superior placement consistency, alumni network, and modern campus. IIIT Sonepat and IIIT Kurnool are solid options if you strongly prefer Institutes of National Importance and remain flexible about location and placement variability. Continue with CSAB counseling to maximize chances at higher-preference institutes, but a confirmed seat at IIIT Kalyani or Nirma University stands out as a reliable and future-proof option for a CSE career. All the BEST for a Prosperous Future!

Follow RediffGURUS to Know More on 'Careers | Money | Health | Relationships'.

...Read more

Nayagam P

Nayagam P P  |9650 Answers  |Ask -

Career Counsellor - Answered on Jul 29, 2025

Asked by Anonymous - Jul 29, 2025Hindi
Career
Sir DTU me engineering physics kaisa hai? Is it worth doing please bata dijiye
Ans: Engineering Physics at Delhi Technological University (DTU) offers a multidisciplinary, research-driven curriculum that connects core physics concepts with advanced engineering and computational applications. The B.Tech program spans four years with a 240-credit structure, blending classical mechanics, quantum mechanics, photonics, electronics, digital systems, microprocessors, communication systems, and specialized electives such as VLSI and satellite communication. Faculty in the Applied Physics department are highly qualified, with many holding advanced degrees and active research backgrounds, and are supportive of student research interests. DTU's infrastructure is nationally accredited by UGC, NBA, and NAAC, boasting modern labs, large classrooms with smart technology, an extensive library, secure hostels, and excellent sports/medical facilities. Student reviews note the academically rigorous environment, strong peer group, and faculty mentorship, though the engineering physics curriculum is often considered tougher and more theory-intensive compared to other DTU branches.

In terms of placements, 75–80% of DTU Engineering Physics graduates are placed each year, with top recruiters like Google, Microsoft, Amazon, and Tata Consulting Services offering roles in software, analytics, R&D, and applied physics-based industry. The branch reports lower absolute placement numbers than CSE or ECE, as several students choose to pursue master’s degrees or research careers at premier institutions domestically and abroad. Placement cell support is robust for those interested in industry, with inspiring alumni working in high-tech R&D, analytics, finance, and scientific roles at organizations like ISRO, DRDO, and multinational tech firms. About 85% of students secure internships in industry or government labs, ensuring good practical exposure. The five essential institutional attributes—accreditation, dedicated faculty, top-tier infrastructure, industry and research collaboration, and transparent placement mechanisms—are all strongly evident in DTU’s Engineering Physics program.

Overall, DTU's Engineering Physics is best suited for academically curious, concept-driven students targeting careers in R&D, technology consulting, analytics, core engineering, or advanced research, and is a prestigious, future-focused option both for industry and higher studies if you are prepared for its intellectual rigor. All the BEST for a Prosperous Future!

Follow RediffGURUS to Know More on 'Careers | Money | Health | Relationships'.

...Read more

Dr Karan

Dr Karan Gupta  |163 Answers  |Ask -

International Education Counsellor - Answered on Jul 29, 2025

Asked by Anonymous - Jul 24, 2025Hindi
Career
Hello sir, I am currently a first year B.Tech student in Manipal Institute of Technology but I just got an offer from Singapore University of Technology and Design. Most of the people I talk to havent heard of it but from what I know its a really good college. The only thing is that the fees is much higher. So I am really having a hard time trying to decide what to do. I have been passionate about robotics since my childhood and want to study that further. I know that the education would be better in SUTD but to what extent? Would it justify the much higher fees? I would say my current focus is just developing skills in robotics and to get to know as much as i can in the same topic.
Ans: Thanks for reaching out—this is an important decision.
You're right—SUTD is an excellent university, especially for design, tech, and robotics. It's backed by MIT and has a strong innovation-driven curriculum. The exposure, labs, international faculty, and research opportunities are world-class—definitely a notch above what you'd get at most Indian colleges, including Manipal.
But yes, fees are high, and that matters.
Here’s how you can think about it:
• If your family can comfortably afford it without debt or strain, SUTD is a great investment, especially if your goal is deep tech, research, or even pursuing a master’s abroad later.
• If finances are tight, then stay at Manipal, and focus on building your robotics skills through online courses, competitions (like Robocon), internships, and IIT techfests. You can always aim for top MS or PhD programs abroad after your B.Tech.
SUTD gives you a head start, but it’s not the only way. Your passion and consistency will matter more in the long run. Let me know your financial constraints, and I can help you weigh it better.

...Read more

Ramalingam

Ramalingam Kalirajan  |9924 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 29, 2025

Asked by Anonymous - Jul 12, 2025Hindi
Money
And we are still investing in mutual funds and plan to do so for next 5 years,my husband invests 30 k ,and i invest 45k
Ans: You and your husband are doing a fantastic job with your monthly investments. Investing Rs. 75K every month shows strong financial discipline. This consistent approach builds wealth and protects your future. Let us now assess your mutual fund journey from all angles.

? Current SIP Strength and Long-Term Potential

– Monthly SIP of Rs. 75K is a solid starting base.
– Over 5 years, this creates a strong corpus.
– Assuming growth, this will accumulate significant wealth.
– Your investing period of 5 years needs careful product selection.
– Short-to-medium term investing demands stability, not aggressiveness.
– Hence, fund selection must match time horizon and risk appetite.
– A Certified Financial Planner can guide scheme selection based on goals.

? Importance of Investment Tenure

– Five years is not a very long horizon.
– Hence, aggressive small-cap funds carry higher volatility.
– Stick to flexi-cap, large-cap, and balanced advantage categories.
– These offer better risk-reward balance in 5-year timeframe.
– Avoid overly sector-specific or thematic funds.
– Asset allocation should favour stability over chasing returns.

? Regular Plan Advantage vs Direct Plan Disadvantage

– Many investors choose direct plans for saving expense ratio.
– But they miss out on expert guidance from Certified Financial Planners.
– This increases chances of wrong fund selection or wrong exit timing.
– Wrong asset allocation or overlapping funds also impact returns.
– Regular plans through CFP-backed MFD offer holistic hand-holding.
– You receive periodic rebalancing, performance monitoring, and personalised reviews.
– The cost difference is minor compared to guided wealth creation.
– A goal-based approach with CFP supervision reduces regret and errors.

? Stay Away from Index Funds – Understand Why

– Index funds may look simple and low cost.
– But they carry hidden disadvantages often overlooked.
– Index funds invest passively in top companies of the index.
– They offer no downside protection in falling markets.
– No active strategy during volatile or sideways periods.
– Also, they follow market blindly, without fundamentals.
– In India, market inefficiencies offer space for active managers.
– Actively managed funds outperform index funds in India consistently.
– They are agile, selective, and dynamic in asset picking.
– Certified Financial Planners help choose best-performing active funds.

? SIP Strategy Review – Risk Alignment and Suitability

– Check how much of your Rs. 75K goes into high-risk funds.
– Avoid high exposure to small-cap and mid-cap segments.
– Cap allocation to these at 20%-30% max.
– Majority should be in balanced, large, or multi-cap funds.
– This reduces downside and improves consistency.
– Each fund must have a clear role and no overlap.
– Avoid too many funds for diversification.
– Keep portfolio compact with 5-7 funds only.

? Goal Planning – Tie Investments to Life Events

– If you have specific financial goals, allocate accordingly.
– Short-term goals should be in low-risk hybrid funds.
– Long-term goals may include child’s education, retirement, etc.
– Discuss these in detail with a CFP.
– This helps match investment type with goal duration.
– Also aligns growth expectation and exit strategy.
– Many investors miss their goals due to mismatched funds.
– Avoid this mistake by goal-based investment planning.

? Rebalance and Review Periodically

– SIPs need annual review to ensure alignment.
– Fund performance can vary due to many factors.
– A fund lagging for over 12 months needs attention.
– Also review sector exposure, overlap, and tax impact.
– A Certified Financial Planner will do this periodically.
– Rebalancing helps protect from over-concentration.
– It also captures gains and shifts to better opportunities.

? Tax Planning within Mutual Fund Framework

– Mutual fund taxation impacts your net returns.
– For equity funds, STCG is taxed at 20%.
– LTCG above Rs. 1.25 lakh is taxed at 12.5%.
– For debt funds, gains taxed as per income slab.
– Plan exits smartly to reduce tax outgo.
– Use tax-harvesting if nearing 1.25 lakh LTCG.
– Align exit strategy with fund performance and tax limits.
– Don't ignore taxation; it quietly erodes final returns.

? Avoiding Insurance-Cum-Investment Products

– If you or your husband have LIC, ULIP, or money-back plans, evaluate them.
– These offer poor returns and low flexibility.
– Surrender such policies if lock-in is over.
– Reinvest in mutual funds with proper planning.
– This boosts compounding and improves goal alignment.
– Don’t mix insurance with investment ever.
– Treat them as separate needs for better results.

? Protecting Your Investment Journey

– SIPs should not stop even in bad markets.
– Market dips are best times to accumulate more units.
– Avoid emotional decisions during correction periods.
– Stay patient and continue monthly contributions.
– Rupee Cost Averaging helps reduce risk over time.
– If income reduces, lower SIP, but never stop.
– Stay consistent and disciplined for long-term success.

? Emergency Fund and Insurance Backup

– Ensure emergency fund is at least 6 months’ expenses.
– This avoids disturbing SIPs during sudden financial stress.
– Also review life and health insurance coverage.
– Ensure it is sufficient and updated.
– Use term insurance for life cover, not ULIPs.
– Use family floater health insurance for medical needs.

? When 5 Years End – Exit and Reinvestment

– Start planning your exit 12-18 months before maturity.
– Move funds gradually to safer options.
– This protects capital from market corrections.
– Consider conservative hybrid funds near withdrawal time.
– Don’t wait till last month to act.
– Also plan next set of goals and reinvestment.
– Don’t keep funds idle after 5 years.
– Reinvest based on new goals or income needs.

? Keep Emotions Out, Data In

– Emotional investing leads to poor decisions.
– Don’t chase top performers each year.
– Choose funds with consistent 5+ year track records.
– Also check downside protection, not just returns.
– Use data, not marketing material, for fund choices.
– A Certified Financial Planner uses professional tools for selection.
– Stay objective, not reactive.

? Avoid Investment Myths and Social Advice

– Friends or relatives may suggest schemes casually.
– Their risk appetite may not match yours.
– Also avoid YouTube tips or WhatsApp forwards blindly.
– Many half-truths and old advice circulate online.
– Follow structured and professional guidance only.
– Choose investments based on your family needs.
– Don’t compare portfolios or returns with others.
– Your journey is unique.

? Final Insights

– Your joint SIP effort of Rs. 75K/month is admirable.
– Continue this for 5 years with discipline and strategy.
– Choose funds based on goal, risk, and time.
– Avoid index and direct funds to stay protected.
– Take guidance from Certified Financial Planner regularly.
– Link each investment to a goal and review annually.
– Protect capital near goal maturity using low-risk funds.
– Use regular plans for full support and peace of mind.
– Don’t mix insurance with investment at any stage.
– Maintain emergency fund and review risk coverage.
– Reinvest matured corpus based on next life phase.
– Keep simplicity, discipline, and patience in investing.
– Long-term wealth is created through consistency, not luck.
– Keep up your good work and grow steadily.

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

...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.

Close  

You haven't logged in yet. To ask a question, Please Log in below
Login

A verification OTP will be sent to this
Mobile Number / Email

Enter OTP
A 6 digit code has been sent to

Resend OTP in120seconds

Dear User, You have not registered yet. Please register by filling the fields below to get expert answers from our Gurus
Sign up

By signing up, you agree to our
Terms & Conditions and Privacy Policy

Already have an account?

Enter OTP
A 6 digit code has been sent to Mobile

Resend OTP in120seconds

x