Advise needed on my Financial Planning

POSTED BY inam ON April 4, 2014 8:25 pm COMMENTS (4)

Hello Manish,

I am currently employed in a MNC in Bangalore.

My gross salary is 44491 per month and take home is 41361 per month.

Kindly guide me on the financial planning.

My house rent is 12000 PM. Also i have an LIC plan (Jeevan Surabhi plan for 20 yrs which i had started when i was 25 yrs old) whereby i investment whereby I pay 36,540 (=9135*4).

I have closed my two personal loans early in 2012.

Please guide me on how to invest. Is investing in tax saving MFs a good option.

I already had some investment in MFs for a lock period of 3 years whereby i had invested total 35K in 2008 and got 40K in 2012. I have taken back the same in the month of Nov 2012.

Is MF or SIP or FD or RD a good option for a person like me.

Also my age is 33 and marital stautus is Married plus spouse.

Also let me know what is the max amount I can show for tax purpose.

I do not have any plans to go for home loan or educational loan as of now.

Thanks

4 replies on this article “Advise needed on my Financial Planning”

  1. ashalanshu says:

    Dear Inam, how about reading this first?

    jagoinvestor. com/forum/finacial-planing-faqs

    Thanks

    Ashal

  2. manikambh says:

    Since you have closed 2 personal loans, use one amount in taking mutual funds through SIP., and another amount to build emergency fund.

    Also I recommend you to take a term insurance in between 50 – 75 lakhs which should come at the price of 6-7 K considering your age, when you get a home increase your cover by another 40 -50 lakhs.

    The amount you can show for tax is 1 lakh in 80c and upto 30 K in 80 D. There are other sections also but these two are popular.

    In 80 C, EPF amount which is 12% of your basic is already exempted. suppose your basic is 20k then 2400 * 12 = 28800 is already exempted, remaining you are paying for lic 36540, that takes remaining 34660 to save.

    You can either put that amount in PPF or take a Tax saving equity fund (ELSS) through SIP mode say 2200 per month and take term insurance. Its totally your call.

    Happy Saving.

    1. inam says:

      Hi,

      Thank you for the detailed reply in this regard.

      I understood most of the info mentioned in your email but still need some clarifications.

      Hence thought will explain to you in detail regarding my current plans on the basis of the inputs provided in your email.
      There are some variations in the figures provided in my earlier mail and hence will provide the latest one.

      1. My take home salary is 43,645 INR PM.
      2. My basic salary is 12,227 INR PM.
      3. I have an LIC plan (Jeevan Surabhi plan for 20 yrs which i had started when i was 25 yrs old) whereby i investment whereby I pay yearly which is 36,540 INR (=9135*4).
      4. My age is 33 and marital stautus is Married plus spouse.
      5. I am currently employed in a MNC which provides the medical insurance for 3 lakhs per annum.
      6. Regarding the amount of 1 lakh where I can show for tax according to 80C, can you let me know how much more I will need to invest considering my basic salary and LIC and Provident fund.
      7. I was thinking of investing in a 5 year FD plan with ICICI whereby I can show the same for tax. Is investing in 5 year ICICI tax saver FD plan a good option as I did not see the mention of the same in your previous mail.
      8. Also regarding 30K in 80D, I understand the amount of 15K can be shown as medical bills of me and spouse . I will not be able to show the 15k for my parents as they have insurance and are covered under the ECHS(Ex Army personnel scheme).
      9. You have mentioned a point regarding Term Insurance in the email. Can you please elaborate in this regard. I have been trying to read and understand articles and the best available Term insurance but as there is too much information everywhere, I am unable to get a clear idea and decide on which is the best one applicable to me.
      10. Is investing in a 5 year tax saver FD in ICICI OR investing in PPF OR investing in Tax saving equity fund (ELSS) through SIP mode the most effective one.
      11. Just forgot to mention that currently I have a RD account with HDFC whereby the investment is 1000 INR per month. Should I carry on this or not.

      Hope that the above mentioned points are detailed from my end and awaiting a detailed response from your end in this regard.

      Advance Thanks.

      1. manikambh says:

        I hope u read the link provided by ashal, please read that before proceeding further.

        Seems your contribution in pf is 1467 pm * 12, it comes around 17.5 k per annum if 541 is not deducted. Lets assume 17.5 k is exempted. Total 54 k is exhausted from 1 L limit. You still need 46 k to cover in 80 c. We have various instruments that you can do to save the remaining amount.

        Elss is a equity linked savings scheme where you can invest in the mutual funds with lock in period of just 3 years. Where as ppf is a govt backed scheme where your amount is locked for 15 years though you can apply for loan from 7 th year onwards. Tax saver fd is locked for 5 years but the earnings are not tax exempted and is calculated based on your tax bracket, the returns are not good in this case.

        Before investing ask yourself why you want to invest, if its just to save tax then think again. Investments should be goal based child edu, marriage, retirement. All in all see this as a chance to create wealth.

        Ppf is really for a long term i.e 15 years with 8.7 % returns and the whole amount is exempted from the tax. You should consider investing in it.

        Elss is a good thing happened to investors who dont want to invest directly in stock market, its upto you to continue or redeem the units accumulated by you once 3 years is completed.

        Tax saver fd as i said am not a big fan of this so i wont recommend this.

        Its upto you to decide if you want that money for 15 or 3 yrs based on that you can invest in them individually or in both.

        Also i recommend to take term insurance its the purest form of insurance taht will protect your family incase some unforseen incident happened to you. Since you are the only bread winner in the family consider taking it. For your age it the premium should be less. There are lot of articles by manish in this website about health and term insursnce. Do read it.

        Dont forget to create emergency corpus of atleast 3 months expense and keep it somewhere where you can easily liquidify. Your rd amount of 1000 is ok it will solve some issue in future.

        Go through different posts here in this website to gain te knowledge. The figures are upto you to decide.
        🙂

        Thanks

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.

Download Our FREE Ebook!

Available only for first 100 people today

Download Our FREE Ebook!

Available only for first 100 people today