swara asked, Hi, me and my husband both earn 70k pm. 30k is our EMI for home loan. LIC pol prem pm is 6000 pm. 25k we can save and invest for future. How and where should we invest to meet our short term and long term goals?
Sushil, Dear Swara, from the figures given by u I deduce that u are able to manage ur life in around 11-12K p.m. If this is real, then u can achieve Financial Freedom within 6-7 yrs. But i think that ur actual cost of living would rise in future. U should look at investing most of the savings into Mutual Funds thro the SIP route. Also do take up adequate TERM Insurance cover (U have a Housing Loan).
kamayani asked, Hi. I am earning 5 L p.a.I am 27 yrs. old. have a daughter who is 2 yrs. old I want to invest maximum possible amount in her education. Kindly advise how much and in what I should invest in?
Sushil, Hi Kamayani, u should look at investing regularly into a diversified Mutual Fund thro the SIP route. U can pick the following funds for the same — HDFC Growth Fund and JM Emerging Leaders fund
SONIA asked, HI I AM SONIA AND I WANT TO INCREASE MY TAKE HOME SALARY WILL mba & pgdbm HELP ME IN ACHIEVING IT?
Sushil, If u do an MBA from a reputed institute, it would definitely help.
Maneesh asked, Hello, I have got a ULIP having a SA of Rs 5 lacs and 2-3 health policies which cover myself, my spouse and both my kids have Sum assured of Rs 3 lacs each for myself and my spouse and Rs 50000 each for my kids. Do I still need a TERM COVER, please advise?. Sushil, Dear Maneesh, each individual has a specific risk (based on his need) that he should cover. In case the income stream is hurt (due to death) then insurance would protect the people dependent on the income and ensure that they r not put into financial discomfort. Now what r the components to arrive at this risk. Let me put it in points: 1. Any and all the existing liabilities (all loans – personal, vehicle or housing, etc). 2. Number of dependants on the income. It will enable u to estimate what kind of money they would need to survive without ur income. A study and analysis of lifestyle (cost of living) would have to be done for this. This is complex. If ur spouse is earning, then her need (amount of support from insurance) maybe less. Alternatively u should also take into consideration whether a non working spouse will be able to start working and generate some income. Similarly if u have a huge surplus of funds u may not require insurance. 3. Children: A critical factor. Most people start to think of insurance when they have their first child. Here u will need to factor in the amount of money that may be needed till the time ur child becomes independent (he/she is able to support him/herself). Insurance should include money upto the point it is able to support his/her graduation. For further higher eductaion he/she can take an educational loan. Apart from the above imp points there may be other factors too that may have to be taken into account. But it would depend on each individual case. indermohan asked, Hi!’ I am doing service and my monthly take home is Rs 18000/ pm what I am doing is depositing Rs. 5000/- in ppf and taking NSC of Rs. 5000/- pm and planning same for another 10 years will it give me financial freedom after 50 years and also investing Rs. 25000/- yearly in good shares?
Sushil, PPF and NSC may not be the best place to create wealth over the long run. Their role is limited to bringing stability to an Asset Allocation plan. It would make more sense for u to divert this money to investing into Mutual Fund SIPs over the long run. To evaluate Financial Freedom would need to know a lot more details.
guest asked, hi i’m 27 yrs old. My monthly expenses are around 25k. what should be my corpus to retire at the age of 35 if I have to maintain the same lifestyle? Sushil, If u have 80L corpus by ur age 35, it will be able to sustain u till ur age 80 at the current lifestye. Assumptions are that the cost of living is rising at 7% p.a. and the money is invested into diversified MFs, where the money grows at 14% for 10 yrs, and it drops by 1% after every 10 yrs. Firoz asked, Hi……i hv just taken 2 policies of HDFC Standard Life (UL young Star Suvidha Plus). First is annualy Rs 25000 and other one Monthly Rs 3000 for the period of Ten Years. Please let us know if this is good policy. I’d highly appreciate if you please reply. Thank you……
Sushil, First of all Congratulations for choosing the BEST THING. Select the growth option of this ULIP plan. It would really be beneficial if u continue to invest till the end of 10 yrs. If u stop in between then it would not be beneficial.
Ambika asked, Good afternoon sir. This is gowri and im working from past 6 months and my ctc is Rs 1,80,000/-. I dont think my expenses are more as soon as i draw my monthly salary but in the middle of the month, some or the other expenses will come up for which i ll have to spend on them. Im not able to save according to my plans. I’m very confused as i’m in need of a good financial plan monthly. I want to save atleast 75% of my salary every month as i don’t have any additional income as of now. I request you to guide me in my monthly financial planning. Sushil, Dear Ambika, do an SIP into a Mutual Funds. This would ensure forced saving. To be able to better manage ur finances, take a small diary. Whenever u spend money, note down the expenses in this diary. After 3 mths evaluate how the money is spent. That would enable u to become more aware about how u spend money and suggest wat changes need to be made. If u use ur credit card, I strongly recommend that u cut it into 2 pieces and use a debit card instead. Raju asked, Hi , I would like to know how much I need to invest in pension plans so that I will get sufficient pension after I retire. My monthly expsenses now are at around 30K. So I need to know when I retire after 25 Years, how much i would need as pension? Sushil, Pension Plans offered are highly rigid in nature. And the returns too over the long run are not that great. Though it ensures discipline in investing, it would still make a lot more sense to invest in Mutual Funds thro a SIP for the next 25 yrs. U would end up with far greater wealth thro this method. Hariharan asked, Mr. , I am 48 years old. I seek your advice as to how much I should save and invest every month so that our current life style based on a monthly expenses of Rs 30,000 can be sustained even after my retirement 12 years down the line? Sushil, U would need to accumulate roughly around 1 cr to maintain ur lifestyle till ur age 85 yrs. The amount that u need to invest would depend on how much resources that u have already accumulated. If u do not have any resources till now, u would need to do a 25K pm SIP into diversified equity Mutual Funds to reach a target of 1 cr in 12 yrs time. vintesh asked, hello sir, I am working abroad having a savings bank A/C in india how i can start investing in MF? is possible through online investing on monthly bases my currently saving is 40K/M. Sushil, Hi Vintesh, U can register with individual Mutual Funds to get online access. With this access and Net banking it is possible to purchase Mutual Funds online. There is a one time paper work that would need to be done. Prasanna asked, Dear Mr., Which is the best: Shares/MF/FD? Age:22; Gross:10k; Savings:5k p.m.; Want financial Freedom at 30. How much should I save from the next month? Savings as far as now:12k. Sushil, Dear Prasanna, It is not possible to predict the best MFs in advance. To invest in stocks directly u need to do ur homework. There is a lot of effort involved if u want to pick gud stock. ben asked, Is the person who are not earning less than 10k (take home) can be financially independent in future?.I belong to category of 10k per month (net). I am married and 36years old. I am a central govt employee. Can you give some suggesions for me? My retirement age is 60 Years. Sushil, Financial Freedom is a lot relative to the state u r in. Even if u earn less, but if ur cost of living is lower, u can achieve Financial Freedom. Similarly if u earn higher income, but the cost of lifestyle is greater than income, such a person will never achieve Financial Freedom. U still have a long working life (24 yrs). Invest any savings into diversified equity Mutual Fund with a long term (20yrs) horizon. u will definitely achieve Financial Freedom by the time u retire, if u keep ur lifestyle in check. DXB asked, I am an NRI & wants to invest long term for 10-15 yrs. please advise which mututal funds will give a good return of 20-30%? Sushil, The returns expected r not realistic. u should expect around 15% annualised returns over this tenure. Pick a large cap fund (Reliance Vision, Sundaram Select Focus), a Value based fund (SBI Contra), a mid-large cap fund (Franklin Prima Plus) and an aggressive fund (JM Emering Leaders Fund). vvvv asked, hi. i am married woman with 100% home ownership, no debt and sizeable savings (57 lakhs). husbands earnings takes care of all my living expenses. presently i am not working so no further income. currently, my 57 lakhs are being deployed as thus: 20 lakhs in mutual funds, 17 lakhs in FMPs and 20 lakhs in idle cash (i dont anticipate needing it either). please advise what i should do with my 57 lakhs for future requirements? Sushil, Based on info I feel that u should shift around 10L from cash to Equity Mutual Funds with a 5 -7 yr horzion. U have not provided details like cost of living to guide u further. gkb asked, Good Afternoon Mr. . I never had enough resources to invest earlier. I am currently 35 and single. Is it good enough to accumalate retirement wealth (around 50 years) if I invest 70000/- annually at PPF and another 50000/- in Mutual Funds hereon? Just to keep you aware, luckily I have already 3 Life Insurance policies which I took when I was around 28-30 years. Sushil, Hi gkb. With the proposed investment u should roughly be able to accumulate around 50L by ur age 50 yrs. U have not mentioned details about ur insurance investments. 50L then should be able to generate around 10K worth of purchasing power in today’s terms (assuming cost of living rising by 7% p.a.). This withdrawal can be continued till ur age 75 yrs taking into account the rise in cost of living. If u can live ur life in 10K today, and will keep a similar lifestyle throughout ur life, u can think of retiring by ur age 50. john asked, Hello , Please let me know the amount required in debt instruments such as in fixed deposits and MIP funds to generate at least Rs 25,000/- monthly income. Sushil, Dear John, assuming that u r able to generate a post tax return of 7.5% (possible thro a combo of FMP, FDs and MIPs), u would need to have around 40L so as to generate approx 25K p.m. income. But as time goes by, the purchasing power of 25K would reduce due to effect of inflation. Ritakriti asked, Hi I am Ritakriti, earning 18,500 per month. I have invested 1,50,000 last year in various mutual funds and NSCs, and will be investing around 70000 as a premium to those mutual funds for three years. My age is 28 years and married, have a 2 yr old daughter. I want to know how and where should i invest my money so that i can get interest monthly on that after 2 years when i stop working?
Sushil, Dear Ritakriti, In around 2-3 yrs time by investing the money u should be able to accumulate around 3-4L. When u want to start withdrawing money, u invest this entire amt into a diversified equity oriented mutual fund and start a Systematic Withdrawal Plan of 1% of the amt per month. These withdrawals u can continue to receive for a very long time (maybe 20 to 30 yrs). But then over time the purchasing power of the amt withdrawn would reduce.
anand asked, Sir, how much to invest (%) in shares, equity related MF, debt related MF, fixed deposits, Insurance, PPF/NSC? Sushil, Hi Anand, there is no standard rule to decide on Asset Allocation. Asset Allocation should be decided on the objective of investing, risk appetite, horizon of investing and the amount of returns expected or needed to be made. rajesh asked, Hi, I am 31. I am investing 5000 per month for last two years in a tax saving mutual fund. I don’t have any insurance and got married last year. what more can i do or make changes in my investment as my income is 15k per month and i cannot save more than 5000 per month? Sushil, Dear Rajesh, at this point of time continue to invest in the ELSS Scheme. Also as u have responsibility of ur family, it is essential that u look at taking up an adequate TERM INSURANCE cover.
Kapil asked, I am 29 years old and working as Manager in IT in a KPO company. In the last 2 years I have regularly bought a few Mutual funds (HDFC Equity, Reliance Growth, Fidelity Equity, Magnum Global) and my porfolio value as of today is 2.5 Lacs. Now a days every month I invest 4K from SIP route. I want to achive financial freedom at the age of 45. I have a kid and planning to have one more and I also wanted to make sure that I can give them good education too (degrees from US, etc.). Please let me know if I am on the right track. Thanks in anticipation.
Sushil, Dear Kapil, it is gud that u have a clear idea of what u want in life. Ur Objectives seem to be clear. But to actually evaluate whether u r on track, will need more info. U can meet up a genuine Financial Planner to work on a Plan that would enable u to meet ur objectives. The funds that u picked seem to be reasonably gud.
Nutan asked, Dear , I and my spouse together earn 7.4 L p.a.I am 27yrs and my husband is 32 yrs. old. I have son who is 2.5 yrs old. I have invested about 2 L in Mutual Funds and Equities. I have taken home loan of 7 L for 10 yrs. I do not have any insurance plan though I am looking for one. My husband has insurance of 5 L. Can you please advise right investments to be done in insurance, debt and equities? Sushil, Hi Nutan, U seem to be doing well. Both U and ur husband should not delay taking up a adequate TERM Insurance cover (especially as u have a loan liability). U can get quotes from various companies for the same, but check up SBI Shield and ICICI Pru Lifegaurd , which generally work out to be cheaper in terms of cost. Build sufficient debt to take care of any emergencies (medical or otherwise) and also have 3-5 mths worth of expenses in ur savings bank. Debt can be into FDs or Fixed Maturity Plans (FMPs) from the Mutual Funds. Continue investing that money which u can keep invested for at least 5 yrs into Equities thro the mutual fund route. vineed asked, Good afternoon Mr. , I am 31, I wish to plan for retirement years. Which plan should I opt for, What Insurance premeium to be paid so as to receive comfortable income after the age of 55 years? Sushil, Dear Vineed, instead of an Insurace based investment plans, it would be more wise to invest into Diversified Equity oriented Mutual Funds to build a sufficient corpus for ur retirement. Take an Adequate TERM Insurance cover. Invest ur savings thro a SIP into MFs. kuldeep asked, Hello , i am working for last 3 years after completing my Btech i have recently purchased a house on a loan of 12 laks…now i am planning to do a Executive MBA from a reputed B school and the fees is very high upto 7.5 laks i have approached many banks for loan and none have passed it. my home loan is blocking the way for the education loan…what would you suggest me on this situation?…THanks. Sushil, Dear Kuldeep, generally reputed B-Schools have tie ups with banks to provide Education Loans to the students. I think u should approach the B-School Authorities who may be able to guide u further. abcxyz asked, Please give name of few good diversified equity funds irrespective of Market Cap. Sushil, Fidelity Equity Fund, JM Equity Fund and HDFC Growth Fund. gikky asked, hi, i earn 5 lacs per annum, tell me that is it better to invest in flat/plots or invest in the shares of real estate companies ( like DLF etc). I am only looking from investment point of view, i already have a house of my own to live in. Also, how will real estate investment like flat/plot compare with equity investment in good companies over the long run? Sushil, Both real estate and equities r high growth asset classes. In the long run equities can deliver 14-16% annualised return whereas real estate should be able to deliver 12-14% return. If u have enough financial resources it makes sense to diversify investments across both assets. kishore asked, Hi , I am working in a private company and take home pay is around Rs.15,000/-. I am aged 45 years and will be retiring in another 13 years. Please suggest some good schemes/scrips from which I can earn 10 to 12% interest p.a. This should be a safe investment. I can invest around Rs. 5000/- every month. I cannot afford to lose any money. Sushil, Invest into diversified equity Mutual Funds. Reliance Vision, HDFC Growth Fund are some of the better managed schemes. Invest into a SIP with a 10 yr horizon. In short run there maybe volatility, but it will create gud returns over this tenure. Raja asked, pl let me know a MF where i can save my tax? Sushil, ELSS Mutual Fund Schemes. Some of the better managed ELSS schemes are Sundaram Tax Saver, Principal Tax Savings Fund, HDFC Tax Saver. trial asked, Hi, I’m 31 yrs old and I’m investing 25k pm towards SIP from Feb this year (Sundaram BNP Paribas Capex Opp, ING – L.I.O.N. Fund, HSBC – India Opp, JM – Equity Fund, Franklin – India Oppt Fund- 5K for each) .How many years shud I invest the same amt to be a crorepati. And how much can I get back everymonth after I discontinue to contribute to SIP without taking back the money from the MF? Sushil, U do not have a strong core portfolio. U should look at adding 2 large cap/ diversified funds. Reliance Vision, HDFC Growth Fund and Sundaram Select Focus. This would lend stability to ur portfolio. Sector funds r best avoided. If u do an 25K p.m. SIP u should be able to accumulate 1 Cr in roughly 12 yrs (assuming a 15% annualised growth in investments). u can roughly do a (systematic withdrawal) SWP of 1% p.m. from the corpus of investments. Archana asked, Hi Am Archana from chennai. am planning to take up life insurance policy for my mom, like yrly 15k which is the best option plan? frm which concern? birla sunlife, bajaj or any other option can u gv me? kindly reply. Sushil, Dear Archana, is ur mom earning some income and is anyone dependent on that income? If the above is true only then would it make sense to take insurance for ur mom. If u r looking at an investment option then the returns in insurance is not so gud. If u have a long term horizon then it would make sense to invest the money into Mutual Funds thro the SIP route. mustu asked, Dear Vetapalen i am working in the gulf my age is 24 yrs and i save around 55k INR per month. i am single i have invested 3 lakhs till now in lumpsum in mutual funds and i have a sip of 25k going every month in HDFC top 200 g ….. so what do i do with my money i save every month should i invest all in MF or waht? please advise. Sushil, U have not mentioned ur objectives in life – like when u plan to buy a house, marriage plans etc. This is wat u should focus on, accumulate funds to pay for downpayment when u plan to buy a house. Also u need to create some funds for ur marriage. Estimate this need and collect funds into an FD. Remaining savings which u would not require for at least 5 yrs or more u can invest into MFs.
