Home > Career > Question
Need Expert Advice?Our Gurus Can Help
R P

R P Yadav  | Answer  |Ask -

HR, Workspace Expert - Answered on Apr 27, 2023

R P Yadav is the founder, chairman and managing director of Genius Consultants Limited, a 30-year-old human resources solutions company.
Over the years, he has been the recipient of numerous awards including the Lifetime Achievement Award from World HR Congress and HR Person Of The Year from Public Relations Council of India.
... more
Shams Question by Shams on Mar 17, 2023Hindi
Listen
Career

Land owner have land and I want to do construction and sell falts. How to get financer? All share holder will share thier profit as per mutual agreement

Ans: Dear Shams,
You can approach an NBFC or a bank for loan and can start your business.
Career

You may like to see similar questions and answers below

Ramalingam

Ramalingam Kalirajan  |8500 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jun 07, 2024

Money
Hi sir i had land , can i sell it put the money in mutal fund .... tq in advance
Ans: Thank you for your query. Selling land to invest in mutual funds can be a prudent financial decision. Let's explore this idea in detail, keeping your best interests in mind. I appreciate your forward-thinking approach and understand the significance of this decision for your financial future.

Understanding the Benefits of Mutual Funds
Mutual funds offer several advantages over real estate as an investment. They provide diversification, liquidity, professional management, and the potential for significant returns.

Diversification
Mutual funds invest in a variety of assets, including stocks and bonds. This diversification reduces risk, as poor performance in one asset is often balanced by better performance in another.

Liquidity
Mutual funds are highly liquid. You can redeem your investments at any time, unlike real estate, which can take months or even years to sell.

Professional Management
Mutual funds are managed by experienced fund managers. These professionals use their expertise to maximize returns, adjusting the portfolio as needed.

Evaluating Your Current Financial Position
Before proceeding, let's evaluate your current financial position. Understanding your overall financial health is crucial in making informed decisions.

Existing Assets and Liabilities
You own land and are considering selling it. Assess the current market value of your land. Determine if there are any outstanding loans or liabilities associated with it.

Financial Goals
Clearly define your financial goals. Are you looking for long-term growth, regular income, or capital preservation? Your goals will influence the type of mutual funds suitable for you.

Risk Tolerance
Assess your risk tolerance. Mutual funds come in various risk levels, from conservative debt funds to aggressive equity funds. Knowing your risk tolerance helps in selecting appropriate funds.

The Process of Selling Land
Selling land involves several steps. It’s important to follow a structured approach to maximize returns and ensure a smooth transaction.

Market Valuation
Get a professional valuation of your land. Understanding its market value helps in setting a realistic selling price.

Finding Buyers
Engage a real estate agent or use online platforms to find potential buyers. Effective marketing can attract serious buyers quickly.

Legal Considerations
Ensure all legal documentation is in place. This includes the title deed, tax receipts, and encumbrance certificate. Clear any legal issues before proceeding with the sale.

Finalizing the Sale
Negotiate with potential buyers to get the best price. Once agreed, complete the sale through a registered sale deed. Ensure all payments are received and documented.

Investing in Mutual Funds
Once the land is sold, the next step is to invest the proceeds wisely. Mutual funds offer various options tailored to different financial goals.

Types of Mutual Funds
Mutual funds come in several types, each with unique characteristics and benefits.

Equity Funds
Equity funds invest primarily in stocks. They offer high growth potential but come with higher risk. Suitable for long-term goals.

Debt Funds
Debt funds invest in fixed-income securities like bonds and treasury bills. They provide stable returns with lower risk. Ideal for conservative investors.

Hybrid Funds
Hybrid funds invest in a mix of equity and debt. They balance risk and reward, suitable for moderate risk-takers.

Benefits of Actively Managed Funds
Actively managed funds, guided by expert fund managers, aim to outperform the market. They offer potential for higher returns, especially in volatile markets.

Expertise and Strategy
Fund managers use their expertise to make informed investment decisions. They actively monitor and adjust the portfolio based on market conditions.

Flexibility
Actively managed funds can adapt to market changes. This flexibility helps in capturing opportunities and mitigating risks effectively.

Disadvantages of Index Funds
Index funds aim to replicate market indices. They can be less responsive to market changes, potentially yielding lower returns during downturns. Actively managed funds leverage expert insights to navigate market fluctuations, aiming for better performance.

Disadvantages of Direct Funds
Direct funds, although lower in cost, might lack the personalized guidance offered by Mutual Fund Distributors (MFDs) with Certified Financial Planner (CFP) credentials. Regular funds provide professional advice, helping you make informed investment decisions tailored to your financial goals.

Step-by-Step Investment Plan
Here’s a step-by-step plan to invest the proceeds from selling your land into mutual funds.

Step 1: Determine Investment Amount
Calculate the net amount from the land sale after deducting any liabilities and transaction costs. This is your investable amount.

Step 2: Asset Allocation
Based on your risk tolerance and financial goals, decide the asset allocation between equity, debt, and hybrid funds. Diversification is key to balancing risk and return.

Step 3: Choose Mutual Funds
Select mutual funds that align with your investment goals. Look for funds with a good track record, consistent performance, and reputable fund managers.

Step 4: Systematic Investment Plan (SIP)
Consider investing through SIPs. This approach spreads your investment over time, reducing the impact of market volatility and leveraging rupee cost averaging.

Step 5: Monitor and Review
Regularly monitor your investments. Review the performance of your mutual funds periodically and make adjustments if necessary. Stay informed about market trends and economic factors that may affect your investments.

Potential Growth and Returns
Investing in mutual funds can potentially offer significant returns over the long term. Let’s illustrate with an example.

Assume you invest Rs.50 lacs from the land sale into mutual funds. If we consider an average annual return of 12%, here’s how your investment can grow over 10, 15, and 20 years.

10 Years
FV = PV × (1 + r)^n

Where:

PV = Rs.50,00,000
r = 12% annually
n = 10 years
FV = 50,00,000 × (1 + 0.12)^10

FV = 50,00,000 × 3.1058

FV = Rs.1,55,29,000

15 Years
FV = PV × (1 + r)^n

Where:

PV = Rs.50,00,000
r = 12% annually
n = 15 years
FV = 50,00,000 × (1 + 0.12)^15

FV = 50,00,000 × 5.4734

FV = Rs.2,73,67,000

20 Years
FV = PV × (1 + r)^n

Where:

PV = Rs.50,00,000
r = 12% annually
n = 20 years
FV = 50,00,000 × (1 + 0.12)^20

FV = 50,00,000 × 8.983

FV = Rs.4,49,15,000

Addressing Common Concerns
Market Volatility
Market volatility is a common concern for investors. However, staying invested for the long term can help ride out short-term fluctuations and benefit from overall market growth.

Inflation
Mutual funds, especially equity funds, have the potential to outpace inflation over the long term. They provide growth that can help preserve the purchasing power of your money.

Tax Efficiency
Mutual funds offer tax benefits, especially long-term capital gains (LTCG). Equity funds have a favorable tax regime, making them attractive for long-term investors.

Final Insights
Selling your land and investing the proceeds in mutual funds is a smart financial move. It offers diversification, liquidity, and the potential for significant returns. By following a structured investment plan and leveraging the expertise of fund managers, you can achieve your financial goals. Regular monitoring and periodic reviews will ensure your investments stay aligned with your objectives.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |8500 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Sep 22, 2024

Asked by Anonymous - Sep 11, 2024Hindi
Money
I need to buy a land worth rs 50 lakhs. I have mutual fund worth 10 lakhs in hand. Should I pay for land buy selling mutual funds or Proceed with loan purely?
Ans: You are considering buying land worth Rs 50 lakhs. You already have Rs 10 lakhs invested in mutual funds. You are weighing two options:

Sell your mutual funds and use the Rs 10 lakhs for the down payment.
Take a loan for the full Rs 50 lakhs.
This is a significant decision that could impact your financial health. Let’s evaluate both options carefully to determine what would be the most beneficial for you.

The Importance of Preserving Investments
One of the key principles of financial planning is ensuring that long-term investments are not disturbed unless absolutely necessary. Your mutual funds are part of your long-term wealth-building strategy. They are designed to grow over time and help you meet future financial goals like retirement, children’s education, or any other major life events. Selling these investments early can disrupt that growth, and you may lose out on potential returns.

Mutual funds offer compounding growth. By holding on to these investments, you benefit from compounding returns over time.

Selling them now may incur capital gains tax. Depending on how long you’ve held these investments, selling them could lead to a tax liability.

You might be forced to sell at the wrong time. If the markets are down, selling could mean realizing losses or missing out on future gains when the markets recover.

Evaluating the Loan Option
Taking a loan can help you finance your land purchase without touching your long-term investments. Let’s look at the advantages and drawbacks of taking a loan.

Benefits of Taking a Loan
Preserves your mutual fund investments. You allow your investments to grow and compound over the long term, potentially giving you better returns in the future.

You benefit from leverage. If the value of the land appreciates, you can enjoy higher returns while only paying a portion of the total cost upfront.

Flexible repayment options. Home loans and land loans come with flexible repayment terms, allowing you to manage cash flow effectively over a long period.

Tax benefits on loans. If the loan is for residential property, there are tax benefits available on both the principal repayment and the interest paid. Though this may not apply directly to land loans, it’s something to consider if you convert the land into residential property in the future.

Drawbacks of Taking a Loan
Interest costs. Taking a loan will add to your financial burden in terms of interest payments. Over the loan tenure, this could be substantial, especially if you take a high-value loan for a long period.

Monthly EMI commitment. Taking a loan will lead to monthly EMIs, which could affect your cash flow and other financial obligations.

Possible impact on credit score. If there is a delay or difficulty in repayment, it could impact your credit score and future loan eligibility.

Should You Sell Mutual Funds or Proceed With a Loan?
Now, let’s evaluate whether selling mutual funds or taking a loan is the better option.

Reasons to Avoid Selling Mutual Funds
Opportunity cost. Selling mutual funds now means you miss out on the potential growth these investments could provide in the future. Equity mutual funds, in particular, tend to offer better long-term returns compared to real estate.

Lock-in periods and exit loads. Some mutual funds come with lock-in periods or exit loads if redeemed too early. This could result in additional costs if you sell them prematurely.

Market timing. The markets might be down when you decide to sell. This could mean getting less than the actual value of your investments, leading to losses.

Long-term financial goals. Your mutual funds could be part of your long-term financial planning. Selling them now could derail some of your future financial goals, such as retirement or children's education.

When Selling Mutual Funds Might Make Sense
There are some instances where selling mutual funds can be considered:

If the mutual funds are not performing well. If you find that your funds have consistently underperformed or if you’ve already planned to exit them, selling might be justified.

No immediate long-term financial goals. If the Rs 10 lakh in mutual funds is not tied to any specific long-term goal, and you have a stable income source, you may consider selling them.

If the land is for immediate use. If the land is for personal use (like building a house), and you feel that selling mutual funds will allow you to avoid taking on more debt, you might consider it. However, this should only be done after careful consideration of your entire financial situation.

The Right Balance: A Combination of Loan and Mutual Funds
A balanced approach could be the best option. You could partially sell a portion of your mutual funds and also take a loan. This way, you retain most of your long-term investments while reducing the total loan amount.

Advantages of Combining Both Options
Reduced loan amount. By using Rs 5-7 lakhs from your mutual funds, you can reduce the loan amount. This reduces your overall EMI burden and interest costs, making the loan more manageable.

Preserve some investments. By not selling all your mutual funds, you still retain a portion of your investment portfolio, which can continue to grow.

Tax efficiency. If you structure the loan well, especially if it's for residential purposes later, you could still benefit from tax deductions on interest and principal repayment.

Managing Your Cash Flow
If you decide to take a loan, managing your cash flow becomes essential. Here are a few tips to ensure that you can comfortably manage your loan repayments without straining your financial resources:

Allocate a percentage of your income for EMIs. A common rule of thumb is that your EMIs should not exceed 40-45% of your monthly income. This ensures that you have enough left over for other financial goals and expenses.

Create an emergency fund. Before taking on a loan, ensure you have a sufficient emergency fund. This can cover any unforeseen expenses without disrupting your loan repayments.

Reassess other investments. If you have other investments besides mutual funds, such as fixed deposits or gold, you may want to assess whether these can be used to reduce the loan amount.

Consider loan tenure. Choose a loan tenure that balances between manageable EMIs and the total interest cost. A shorter tenure means higher EMIs but lower interest paid over time, while a longer tenure reduces the monthly EMI but increases the overall interest burden.

Real Estate as an Investment
It’s important to remember that real estate should not be viewed purely as an investment. The value of land may appreciate, but it is not guaranteed. Land and real estate are illiquid assets, meaning it may take time to sell when you need cash. Additionally, real estate transactions come with other costs like registration fees, taxes, and maintenance.

Key Considerations for Real Estate Purchases:
Long-term capital appreciation is uncertain. Unlike equity mutual funds, real estate does not always guarantee returns. Property values depend on location, demand, and various market factors.

Illiquidity. Real estate is not as easily liquidated as mutual funds. If you need cash urgently, selling land can be time-consuming and could result in lower than expected returns.

Maintenance and other costs. Owning land comes with additional costs such as property taxes, maintenance, and legal fees.

Benefits of Consulting a Certified Financial Planner
Whenever you are faced with a major financial decision, consulting a Certified Financial Planner (CFP) is invaluable. A CFP helps you see the bigger picture and understand the long-term impacts of your decisions.

Objective advice. A CFP provides advice based on your personal financial situation, ensuring that all your financial goals are considered.

Holistic planning. A CFP looks at all aspects of your finances, from taxes to long-term savings, and provides a plan that works for you.

Regular reviews. Working with a CFP allows you to adjust your plans as your financial situation changes over time.

Final Insights
It’s essential to evaluate your decision from multiple angles. Selling mutual funds should be a last resort unless those funds are already underperforming or unnecessary for future goals. Taking a loan allows you to preserve your investments and could lead to tax benefits if structured correctly.

Keep your long-term goals in mind. Don’t sell long-term investments without assessing the future impact.

Taking a loan can help you preserve your mutual funds, allowing them to continue growing over time.

A balanced approach could involve selling a portion of your mutual funds and taking a smaller loan.

Always maintain a healthy cash flow and ensure that loan EMIs do not exceed what you can comfortably manage.

Lastly, real estate, especially land, should be purchased for personal or functional reasons, not as an investment.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
Instagram: https://www.instagram.com/holistic_investment_planners/

..Read more

Latest Questions
Nayagam P

Nayagam P P  |4971 Answers  |Ask -

Career Counsellor - Answered on May 24, 2025

Career
My daughter scored 74.46 percentile in jee mains 2025 and secured 94% marks in her +2 exams. Can she apply for josaa counselling 2025
Ans: Kubendrkumar Sir, Your daughter’s 74.46 percentile in JEE Mains 2025 allows her to participate in JoSAA counselling, as there is no minimum percentile cutoff for registration. This percentile roughly translates to an All India Rank near 1.8 to 2 lakh, which may restrict admission to top NITs or preferred branches like Computer Science. She has better chances in lower-tier NITs, IIITs, or other government institutes for branches with higher cutoffs such as Mechanical or Civil Engineering. Her excellent 94% in +2 exams strengthens her eligibility and can be advantageous for institutes with board percentage criteria. Considering her rank and marks, exploring state universities and reputed private colleges is advisable to secure a good engineering program. It’s recommended she carefully reviews branch-wise cutoffs during counselling and considers a broader range of colleges and branches to maximize admission opportunities. HERE IS, How to Predict Your Daughter's Chances of Admission into NIT or IIIT or GFTI After JEE Main/Advanced Results – A Step-by-Step Guide

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.

Have some other options also as back-ups instead of relying only on JEE/JoSAA.

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

Hope this guide helps! All the best for your daughter's admission and a bright future!

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

...Read more

Nayagam P

Nayagam P P  |4971 Answers  |Ask -

Career Counsellor - Answered on May 24, 2025

Nayagam P

Nayagam P P  |4971 Answers  |Ask -

Career Counsellor - Answered on May 24, 2025

Career
Sir my daughter got jee mains 80percentile and vit 42548 rank srm 31000 Telangana emcet 6304 rank b. Arc rank 2600 b planning 1100 rank we are not able to choose which is the best and we are in Andhrapradesh and intermediate she got 98 percent which group is suitable her and vit vellore cse group is any chance or any suggestion sir
Ans: Your daughter has an excellent academic record with 98% in intermediate and strong ranks: 80 percentile in JEE Mains, 42,548 in VITEEE, 31,000 in SRM, 6,304 in Telangana EAMCET, and top ranks in B.Arch (2,600) and B.Planning (1,100). Admission to CSE at VIT Vellore is unlikely due to highly competitive cutoffs (usually under 1,600 for Category 2), but she can consider VIT AP or Bhopal campuses for CSE or related specializations like AI or Cybersecurity. SRM rank may allow admission in other branches but CSE at top SRM campuses requires better ranks. Telangana EAMCET rank is good for state colleges but may not secure premier branches. Given her strong PCM scores and interest, CSE and its specializations are suitable. Alternatively, with excellent B.Arch and B.Planning ranks, pursuing architecture or planning could be a great option. She should evaluate her interests and consider institutes like Thapar University or reputed private universities for better opportunities. Balancing her rank, interests, and career goals will help make the best choice. All the best for your daughter's admission and a bright future!

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

...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