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Sanjeev

Sanjeev Govila  |442 Answers  |Ask -

Financial Planner - Answered on Dec 06, 2023

Colonel Sanjeev Govila (retd) is the founder of Hum Fauji Initiatives, a financial planning company dedicated to armed forces officers and their families.
He has over 12 years of experience in financial planning and is a SEBI certified registered investment advisor; he is also accredited with AMFI and IRDA.... more
Asked by Anonymous - Nov 27, 2023Translate
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Hi Sanjeev, I am investing in merie asset emerg (5k),parag parekh flexi cap(2k) and ICICI equity (2k)n debt mutual fund since 3 years, wanted to start Nippon India small cap with (5k),also have pf around 7lakhs, ppf 3 lakhs,2 homes loans (85k).stocks1.50 lakhs n saving 1 lakh. I am 38 years old n moderate risk taker n wanted ritired till 55, my retirement goal is 2 caror..pls suggest if m on track on this or not..Thank you

Ans: You have allocated a reasonable portion of your investments to equity funds based on your moderate risk tolerance. Long-term gains from equity funds might be larger, but they also carry more risk. Although the funds held by you are good in fundamentals and can be continued but proper advice based on your needs, goals priority and requirement that too once we are aware about holistic picture.
You are also contributing to a PF and a PPF, both of which are excellent retirement savings instruments.

However, it is critical to keep an eye on your assets and make modifications as needed. To reduce risk as you approach retirement, consider gradually shifting a part of your savings from equity funds to debt funds.

We highly recommend consulting a certified financial advisor who can provide personalized advice based on your risk tolerance, financial goals, and specific circumstances.
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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As part of a couple in our early 30s, along with our elderly parents, we have a combined annual income of Rs 1.08 crores. How can we collectively plan for both our retirement and the financial well-being of our parents in the long run?
Ans: Balancing your financial needs and that of your parents, while planning for retirement, requires a comprehensive strategy. Here's a roadmap to get you started:

1. Understand your financial situation:

Gather information about:

• Income: List down your combined annual income (Rs 1.08 crore) and any other sources of income like rental income or investments.
• Expenses: Track your monthly expenses for a few months to understand your spending habits.
• Debts: List down any outstanding debts like mortgages, car loans, etc., including your parents' debts if applicable.
• Retirement benefits: Check your eligibility and potential benefits from social security or employer-sponsored retirement plans.
• Parents' needs: Estimate your parents' current and future financial needs, including healthcare costs.

2. Set retirement goals:

• Desired retirement age: Decide when you and your partner wish to retire.
• Desired lifestyle: Determine the lifestyle you envision in retirement, considering travel, hobbies, and potential healthcare needs.
• Financial goals: Based on your desired lifestyle and life expectancy, calculate the estimated corpus (total sum) required for your retirement. Consider inflation while making these calculations.

3. Create a financial plan:

• Debt management: Prioritise paying off high-interest debts to free up future income for savings and investments.
• Budgeting: Create a budget that allocates funds for essential expenses, savings, and debt repayments. You can involve your parents in creating a budget for their expenses as well.
• Savings and investments: Explore various investment options like mutual funds, PPF (Public Provident Fund), or NPS (National Pension Scheme) based on your risk tolerance and investment horizon. Utilize tax-advantaged retirement accounts like 401(k)s or IRAs if available to you.
• Healthcare planning: Consider health insurance plans for yourselves and your parents to manage potential medical costs in the future.

4. Open communication and support:

• Discuss openly: Have open and honest conversations with your partner and parents about your financial situation, goals, and expectations. This fosters transparency and builds trust within the family.
• Seek professional guidance: Consulting a financial advisor can help you create a personalized plan considering your specific financial situation and retirement goals. They can also guide you on investment strategies and risk management.

Additional considerations:

• Government schemes: Explore government schemes for senior citizens like the Senior Citizen Savings Scheme (SCSS) or the Pradhan Mantri Jan Dhan Yojana (PMJDY) that may benefit your parents.
• Downsizing: Consider downsizing your living situation or exploring alternative housing options in retirement to potentially reduce living expenses.
• Part-time work: If feasible, consider continuing part-time work in retirement to supplement your income and maintain an active lifestyle.

Remember, this is a general framework, and it's crucial to tailor it to your specific circumstances. Consulting a financial advisor can provide personalised guidance and ensure your financial plan considers all the complexities involved.
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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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