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Ramalingam

Ramalingam Kalirajan2915 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 20, 2024

Asked on - Aug 31, 2023Hindi

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hi sir : my son doing job since two year monthly earning is 60 K. but his saving is nil. pl. advice where to invest
Ans: It's great that your son has started earning, and it's essential to guide him on saving and investing for the future. Here's a step-by-step investment plan tailored for him:

Emergency Fund: Start by building an emergency fund equivalent to 3-6 months of expenses. This fund should be easily accessible, like a savings account or a liquid fund.
Debt Repayment: If he has any high-interest debts like credit card bills or personal loans, it's wise to clear those first to avoid paying hefty interest.
Investment Options:
Equity Mutual Funds: For long-term wealth creation, he can start SIPs in diversified equity funds. A mix of large-cap, mid-cap, and multi-cap funds can provide growth.
PPF (Public Provident Fund): A tax-efficient and safe option for long-term savings with a lock-in period of 15 years.
NPS (National Pension System): A retirement-focused investment with tax benefits, offering a mix of equity, corporate bonds, and government securities.
Term Insurance: Since he's working, consider getting a term insurance plan to ensure financial security for his dependents.
Health Insurance: A comprehensive health insurance plan to cover medical emergencies can provide financial security and tax benefits.
Budgeting and Savings: Encourage him to create a monthly budget to track expenses and identify areas to save. Automating investments through SIPs can also help in disciplined saving.
Financial Education: Educate him about the importance of financial planning, saving, and investing. Encourage him to read books or attend workshops on personal finance.
Starting early with disciplined saving and investing can help him build a substantial corpus over time. Encourage him to consult a financial advisor for personalized guidance tailored to his financial goals and risk tolerance.
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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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