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Can we retire comfortably on our 50 lakhs FD, 5.1 crore investments & 3 flat rentals with 1.25 lakhs monthly expense?

Ramalingam

Ramalingam Kalirajan  |8078 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Aug 01, 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 - Jul 28, 2024Hindi
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I am a teacher by profession this academic year I resigned. I am 50 and my husband is 55 he is planning to leave his job and retire. We are debt free and our only son is pursuing his PhD in USA. Please let us know whether our current corpus is enough for us to leave a decent life and we need around 125k for our monthly expenses. 1.2 crores in EPF, 50 lakhs in PPF, 60 lakhs worth mutual funds and 50 lakhs FD and rest 75 lakhs parked in various other sources. We own 3 flats in Mumbai combined value of it is 6 plus crores. 2 flats r let out. We have health insurance also.

Ans: Current Financial Status
EPF and PPF:

EPF: Rs 1.2 crores
PPF: Rs 50 lakhs
Mutual Funds and Fixed Deposits:

Mutual Funds: Rs 60 lakhs
Fixed Deposits: Rs 50 lakhs
Other Investments:

Various other sources: Rs 75 lakhs
Real Estate:

Three flats in Mumbai worth Rs 6+ crores
Two flats are let out
Health Insurance:

Adequate health insurance coverage
Monthly Expenses Requirement
Expenses:

Monthly requirement: Rs 1.25 lakhs
Evaluation of Current Corpus
Total Corpus:

Total financial assets: Rs 3.55 crores (EPF, PPF, Mutual Funds, FDs, other sources)
Income from Real Estate
Rental Income:

Take two flats for a constant monthly income. The exact rental income should, therefore, be computed for an accurate valuation of the same.
Retirement Planning Observations
Diversification:

Your corpus is diversified very well across various asset classes.
Stability and Growth:

Fixed deposits and PPF provide stability.
Growth comes from mutual funds.
Liquidity:

There should be sufficient liquidity to take care of your monthly expenses and other emergencies.
Recommendations
Investment Strategy:

A portion of your corpus should be invested in balanced mutual funds for growth.
Run adequate fixed deposits for stability and liquidity.
Income Generation:

Maximize the rental income of the flat by letting them at competitive rates.
Invest in dividend-paying mutual funds for generating regular income.
Health Insurance:

Review and ensure health insurance to the extent that it may be necessary with regard to potential medical expenses.
Emergency Fund:

Ensure an emergency fund of 6-12 months of expenses in a liquid fund.
Tax Efficiency:

Plan your investments such that it reduces tax on income that will be generated or withdrawn.
Your current corpus appears sufficient to take care of your retirement needs. Adopt a balanced approach that gives equal emphasis on growth and stability. Maximize the rental income and maintain liquidity for any emergencies. Periodically review and realign your investments in line with your 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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Ramalingam

Ramalingam Kalirajan  |8078 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Aug 03, 2024

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Hi Vivek, I am 46 years old, married, with a 12-year-old daughter. We live in Bangalore and own a loan-free flat in Mumbai valued at 90 lakhs. Currently, we are in the process of buying a flat in Bangalore for 90 lakhs, of which 50 lakhs has already been paid. Here is a summary of our financial assets: - EPF: 1 crore approx - Mutual Funds (via SIP): 90 lakhs (invested 55 lakhs) Blend of Large, Small, flexi and some in aggressive hybrid funds - Land: 18 lakhs - PPF: 25 lakhs - Gold and other assets: 30 lakhs I have a net monthly income of 3 lakhs, but my job is somewhat risky. My wife also works & earns 38,000 per month. Our average monthly expenses are between 80,000 and 90,000. Regarding our investments, we currently allocate 125,000 per month to SIPs, an increase from the previous Rs 70,000. Given our savings and investments, we have a total corpus of around 3 crores. I am fairly conservative in my financial approach and seek advice on whether this corpus is sufficient for maintaining a decent living standard, especially if I were to lose my job now.
Ans: Financial Overview

Your total assets: About Rs. 3 crores
Monthly income: Rs. 3.38 lakhs (you and your wife)
Monthly expenses: Rs. 80,000 to 90,000
Monthly SIP: Rs. 1,25,000
Property assets: Loan-free flat in Mumbai, new flat in Bangalore

Appreciating Your Financial Discipline

You've built a strong financial foundation
Your diverse investment portfolio shows good planning
Keeping properties loan-free is a smart move

Job Risk Assessment

Your job being risky is a concern
But your wife's income provides some stability
Your savings can support you if needed

Expense Management

Your expenses are reasonable compared to income
There's room for more savings if needed
This flexibility is good for financial security

Investment Strategy

Your mutual fund portfolio is well-diversified
Regular SIPs show disciplined investing
Actively managed funds can adjust to market changes

Retirement Planning

Your EPF and PPF provide a solid base
Mutual funds can offer good long-term growth
Regular review of fund performance is important

Daughter's Education Planning

Start planning for her higher education now
Consider setting up a separate education fund
This will ensure her future is secure

Emergency Fund

Keep 6-12 months of expenses in easily accessible savings
This is crucial given your job uncertainty
It provides a safety net for unexpected situations

Insurance Check

Ensure you have adequate life and health insurance
This protects your family's financial future
Don't mix insurance with investments

Debt Management

Being debt-free is great for financial stability
If you take a loan for the Bangalore flat, plan repayment carefully
Balance loan repayment with continued investments

Finally
Your corpus is substantial for your age. With careful planning, it can support a decent lifestyle. Regular review and adjustments will help maintain financial security.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

..Read more

Moneywize

Moneywize   |181 Answers  |Ask -

Financial Planner - Answered on Aug 08, 2024

Asked by Anonymous - Aug 02, 2024Hindi
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I am a professor who has resigned in 2023. I am 52 and my husband is 54. He is also planning to take voluntary retirement. We don’t have any debt and our two daughters are pursuing their MS in Germany. Please let us know whether our current corpus is enough for us to leave a decent life and we need around Rs 90,000 for our monthly expenses. We together have Rs 80 lakh in EPF, Rs 40 lakh in PPF, Rs 40 lakh in MFs and Rs 80 lakh in FDs; we also have an additional Rs 25 lakh invested in other schemes. We own two flats in Mumbai whose combined value is Rs 5 crore. One of the flats is let out. We have health insurance also.
Ans: Assessing Your Financial Situation for Retirement

Understanding Your Financial Position

Based on the information provided, you and your husband have a substantial financial cushion. Let's break down your assets:

• Liquid Assets:
o EPF: Rs 80 lakh
o PPF: Rs 40 lakh
o MFs: Rs 40 lakh
o FDs: Rs 80 lakh
o Other schemes: Rs 25 lakh
o Total Liquid Assets: Rs 2.65 crore
• Real Estate:
o Two flats in Mumbai: Rs 5 crore
• Income:
o Rental income from one flat
o Potential EPF and PPF maturity benefits
• Expenses:
o Monthly expenses: Rs 90,000
o Daughters' education expenses (temporary)

Initial Assessment

Your liquid assets alone are substantial, and when combined with the rental income and potential proceeds from one flat (if you decide to sell), you have a strong financial foundation.

Key considerations:

• Monthly expenses: Your current monthly expenses of Rs 90,000 seem manageable given your liquid assets. However, it's essential to factor in inflation over the years.
• Retirement income: You'll need to determine how much income you can generate from your investments to cover your monthly expenses. Consider consulting a financial advisor to create a suitable withdrawal plan.
• Healthcare: While you have health insurance, consider long-term care options as you age.
• Tax implications: Understand the tax implications of withdrawing from EPF, PPF, and MFs.
• Emergency fund: Ensure you have a sufficient emergency fund to cover unexpected expenses.
• Real estate: Decide if you want to retain both flats or sell one for additional liquidity. Consider property taxes, maintenance costs, and potential rental income.

Recommended Steps:

1. Detailed Financial Planning: Consult a financial advisor to create a comprehensive retirement plan.
2. Risk Assessment: Evaluate your risk tolerance and adjust your investment portfolio accordingly.
3. Income Generation: Explore options to generate additional income, such as part-time work or rental income from the second flat.
4. Tax Optimisation: Implement tax-saving strategies to maximise your post-tax income.
5. Estate Planning: Consider creating a will and other estate planning documents to protect your assets.

Remember: Your financial situation appears strong, but careful planning and monitoring are essential to ensure a comfortable retirement.

Disclaimer: While I can provide general financial guidance, it's crucial to consult with a financial advisor for personalised advice tailored to your specific circumstances.

..Read more

Latest Questions
Ramalingam

Ramalingam Kalirajan  |8078 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Mar 06, 2025

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Hi sir/madam I wanna ask that i have already a capital gain account for rs 30 lac Whose 2 years going to complete in feb 2026 Now i have just 2 flat left- ist floor, 2nd floor with tarace Now 3 different- different person want to buy ist, 2nd and terace, means 3 registry will made, now approxy it will generate 10 lac per floor capital gain after indexation... Meqns total 30 lac So this 30 lac+ capital gain account 30 lac.. A total of 60 lac can i invest in 1 residentiql flat... Is it possible that i will invest in one flat against sale of 3 flat + capiral gain account amount... Thanks
Ans: Yes, you can invest the total Rs 60 lakh in a single residential flat to claim capital gains exemption under Section 54 of the Income Tax Act. However, there are a few conditions you must follow:

Key Conditions for Claiming Exemption
The new property must be a residential house. It should not be commercial or under construction beyond the allowed timeline.

The investment should be within the allowed time frame. You must buy the new flat within 2 years from the date of sale or construct it within 3 years.

You can use the amount from multiple sales. Even if you sell different floors of your property to different buyers, you can reinvest the total capital gain in one residential flat.

The capital gains account balance should be used within the allowed period. You must invest the Rs 30 lakh in the new house before February 2026. Otherwise, it will become taxable.

Important Considerations
If the new property costs less than Rs 60 lakh, the unused capital gain will be taxed.

The exemption applies only to long-term capital gains. If any portion of your gain is short-term, it will not qualify for exemption.

You must not sell the new property for at least 3 years. If you sell it before 3 years, the exemption will be reversed, and you must pay tax on the gains.

Final Insights
Yes, you can invest Rs 60 lakh in one flat and claim exemption under Section 54.

Ensure that you buy the new property within 2 years or construct it within 3 years.

Keep proper documentation for all transactions to avoid issues with the tax department.

If you need more clarity, consult a tax expert before making the final investment.

Best Regards,

K. Ramalingam, MBA, CFP

Chief Financial Planner

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

...Read more

Nayagam P

Nayagam P P  |4275 Answers  |Ask -

Career Counsellor - Answered on Mar 06, 2025

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My son is completing 12th. He is interested in Graphics design. What are the options in this field to study?
Ans: Pradeep Sir, Graphic design offers numerous career opportunities in advertising, branding, publishing, digital media, gaming, and animation. A Bachelor's Degree in Design (B.Des) in Graphic Design or Communication Design is a 4-year degree that provides in-depth knowledge of graphic design, typography, branding, and digital design. Top colleges offering B.Des include National Institute of Design (NID), MIT Institute of Design, Symbiosis Institute of Design, Srishti Institute of Art, Design and Technology, UPES School of Design, and Anant National University. A Bachelor's Degree in Fine Arts (BFA) in Applied Arts or Graphic Design is a 3-4 year course focusing on artistic skills along with graphic design. Diploma courses in Graphic Design are also available, such as MAAC, Arena Animation, Pearl Academy, and National Institute of Fashion Technology. Online graphic design courses can be a flexible option for flexibility. After completing studies, graphic designers can work in advertising agencies, branding and marketing firms, digital media and social media companies, e-commerce and IT companies, publishing and print media, gaming and animation (2D graphic designer), and freelance. IMPORTANT NOTE: As already March has started, it is advisable to apply for 3-4 entrance exams of concerned Colleges and also UCEED, NID-DAT, SEED, MIT-DAT, SEAT, NIFT, Pearl Academy etc. If your son wants to study in top government institutes, he should prepare for UCEED or NID DAT.
If he prefers top private design colleges, exams like SEED, MIT DAT, SEAT, UPES DAT, and Pearl Academy are good choices.
If he is open to fine arts-based programs, NIFT and BFA Applied Arts exams (like MH-AAC CET for J.J. Institute of Applied Art, Mumbai) are also good options. All the best for your Son's admissions, Pradeep Sir!

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My daughter is in 12th and she wants to pursue design as her career not the fashion and interior one but on the IT side. Does this career option have a good career prospects. What are the good colleges where she can do her bachelor degree from which has good placements.
Ans: Tarunima Madam, It's great that your daughter is interested in pursuing a design career in the IT field.

The IT field, also known as UI/UX Design, Interaction Design, or Digital Product Design, offers excellent career prospects due to the growing demand for user-friendly digital products. Companies are actively seeking skilled designers who can create intuitive and aesthetically pleasing digital interfaces. The demand for UX/UI designers, product designers, and interaction designers is growing globally, with diverse opportunities in tech companies, startups, e-commerce platforms, banking & fintech, healthcare, and gaming. Top UI/UX designers in India and abroad earn competitive salaries, with entry-level packages ranging between ?6-12 LPA in top companies. This field also allows for freelance work and global job opportunities.

The demand for innovative designers will continue to grow with the rise of AI, AR/VR, and Web3 technologies. Top institutes in India for UI/UX & Interaction Design include the National Institute of Design (NID), Indian Institute of Technology (IIT), IIT Guwahati, IIT Jabalpur, MIT Institute of Design, Sristi Institute of Art, Design and Technology, UPES, ISDI, Symbiosis Institute of Design, and Anant National University.

If you can afford and if your daughter is interested in studying abroad, globally renowned schools for UI/UX design include Carnegie Mellon University, Rhode Island School of Design, Parsons School of Design, Royal College of Art, University of Arts London, and TU Delft. Pursuing a career in IT-related design is a smart choice with excellent career growth. All the best for your daughter's admissions!

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Nayagam P

Nayagam P P  |4275 Answers  |Ask -

Career Counsellor - Answered on Mar 06, 2025

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My son secure 97.03 percentile in jee main session 1 in general category can he get CSE in any NIT
Ans: Shashi Sir,

How to Predict Your Chances of Admission into NIT or IIIT or GFTI After JEE Main Results – A Step-by-Step Guide

Once the January JEE Main session results are declared, many students and JEE applicants start asking common questions about eligibility for specific institutes (NITs, IIITs, GFTIs, etc.) based on their percentile, category, preferred branch, and home state.

Providing precise admission chances for each student can be challenging. Some reputed educational websites offer ‘College Predictor’ tools where you can check possible college options based on your percentile, category, and preferences. However, for a more accurate understanding, here’s a simple yet effective 9-step method using JoSAA’s past-year opening and closing ranks. This approach gives you a fair estimate (though not 100% exact) of your admission chances based on the previous year’s data.

Step-by-Step Guide to Check Your Admission Chances Using JoSAA Data
Step 1: Collect Your Key Details
Before starting, note down the following details:

Your JEE Main percentile
Your category (General-Open, SC, ST, OBC-NCL, EWS, PwD categories)
Preferred institute types (NIT, IIIT, GFTI)
Preferred locations (or if you're open to any location in India)
List of at least 3 preferred academic programs (branches) as backups (instead of relying on just one option)
Step 2: Access JoSAA’s Official Opening & Closing Ranks
Go to Google and type: JoSAA Opening & Closing Ranks 2024
Click on the first search result (official JoSAA website).
You will land directly on JoSAA’s portal, where you can enter your details to check past-year cutoffs.
Step 3: Select the Round Number
JoSAA conducts five rounds of counseling.
For a safer estimate, choose Round 4, as most admissions are settled by this round.
Step 4: Choose the Institute Type
Select NIT, IIIT, or GFTI, depending on your preference.
If you are open to all types of institutes, check them one by one instead of selecting all at once.
Step 5: Select the Institute Name (Based on Location)
It is recommended to check institutes one by one, based on your preferred locations.
Avoid selecting ‘ALL’ at once, as it may create confusion.
Step 6: Select Your Preferred Academic Program (Branch)
Enter the branches you are interested in, one at a time, in your preferred order.
Step 7: Submit and Analyze Results
After selecting the relevant details, click the ‘SUBMIT’ button.
The system will display Opening & Closing Ranks of the selected institute and branch for different categories.
Step 8: Note Down the Opening & Closing Ranks
Maintain a notebook or diary to record the Opening & Closing Ranks for each institute and branch you are interested in.
This will serve as a quick reference during JoSAA counseling.
Step 9: Adjust Your Expectations on a Safer Side
Since Opening & Closing Ranks fluctuate slightly each year, always adjust the numbers for safety.
Example Calculation:
If the Opening & Closing Ranks for NIT Delhi | Mechanical Engineering | OPEN Category show 8622 & 26186 (for Home State), consider adjusting them to 8300 & 23000 (on a safer side).
If the Female Category rank is 34334 & 36212, adjust it to 31000 & 33000.
Follow this approach for Other State candidates and different categories.
Pro Tip: Adjust your expected rank slightly lower than the previous year's cutoffs for realistic expectations during JoSAA counseling.

Can This Method Be Used for JEE April & JEE Advanced?
Yes! You can repeat the same steps after your April JEE Main results to refine your admission possibilities.
You can also follow a similar process for JEE Advanced cutoffs when applying for IITs.

Want to Learn More About JoSAA Counseling?
If you want detailed insights on JoSAA counseling, engineering entrance exams, and preparation strategies, check out EduJob360’s 180+ YouTube videos on this topic!

Hope this guide helps! All the best for your Son's admissions!

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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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