Advise Requested on Financial planning for retirement

POSTED BY Ramakant Gupta ON August 24, 2013 10:02 am COMMENTS (7)

Hi

I would appreciate guidance on my financial planning.I am 53 yrs and will retire in 7 yrs from now. My monthly salary now is Rs.70000 and I save 15000 every month in my GPF and Rs. 10000 in RD. My monthly expenditure is Rs. 25000 and my sons are settled and are earning. I am paying an EMI of Rs. 13000 towards my home loan but that is taken care of the rent of Rs. 13000 that I am receiving. My current financial position is GPF balance Rs. 4 lakhs, FD Rs. 10 lakhs. PPF 2 lakhs, I have a PLI endowment policy for Rs. 50000 which matures when I will be 55 and a whole life policy for Rs. 1 lakh. I pay 2000 SIP in HDFC Prudence and Rs. 1000 in Reliance opportintiies fund. I know I am not insured well but as I am already 53, and by the time I realized, it is already too late. As I went through the posts in this website, I understood that no cover would be needed beyond 60 yrs. So, I want to maximize my assets by the time I retire, so taht I have a corpus of about Rs. 1 crore. I have an investible surplus of Rs. 20000 every month. I will be grateful for any advise on the best way to go about it. Thanks in advance

7 replies on this article “Advise Requested on Financial planning for retirement”

  1. Dear Ramakant, just do a little bit research about the fund suggested by me & you ‘ll know the answer. 🙂

    Thanks

    Ashal

  2. Dear Ramakant, please invest in Franklin India Bluechip fund for all the 17K amount on mly basis & keep doing so for next 9Y.

    thanks

    Ashal

    1. Ramakant Gupta says:

      Dear Ashal

      Thanks a lot for your advice. I sincerely appreicate it.

      I have one doubt. I keep reading that investors should not invest in a single fund but split it into 2 or 3. Is there any specific reason that you are advising to put the entire amount in one fund?

      Ramakant

  3. Dear Ramakant, 25000 Rs. mly living expenses are as of now. It ‘ll run high due to impact of inflation. Sample this – @ 9% inflation rate, your mly expenses ‘ll be more than 50K @ age 61. Similarly it ‘ll be 1L Rs. @ age 69 & ‘ll keep on increasing even after that.

    What about your health in post retirement life?

    Thanks

    Ashal

    1. Ramakant Gupta says:

      Dear Ashal, Thanks for the reply. Yes. I am aware that my mty expenses will rise with inflation. However, as I plan to have a corpus of Rs. 1 crore, I would be getting Rs. 70000 pm as interest and Rs. 30000 as my pension, which together amounts to Rs. 1 lakh. As per your calculation, my mty expeses would be about Rs. 50000 @ 61 while I will be getting double the amount every month. The remaining amount I can invest in banks etc.which would take care of my future escalating expenses. Thats the reason I am planning for a corpus of 1 crore and seek your advise on the best way to build it with the exsiting resources I have.
      I repeat for ready reference:
      Total income 70000
      expsenses 25000

      Balance 45000

      RD- 10000
      GPF 15000
      HDFC MF 2000
      Reliance 1000

      Total 28000

      Thus I am left with surplus of Rs. 45000 – 28000 = 17000 mtly, which I want to use for building up my corpus.

      Regarding my health after 60, yes its a major issue. However, as I would be left with a surplus of 50000 each month after age 60 , I think I can manage the health expenditue as and when it happens.

      Thanks again and looking forward to ur valuable inputs on my retirement plans

      Thus

  4. Dear Ramakant, how did you reach to the figure of 1 Crore Rs? Was there any calculation or is it just your comfort number?

    May i know your current mly living expenses?

    thanks

    Ashal

    1. Ramakant Gupta says:

      Thanks a lot for sparing your valuable time to go through my question.

      I arrived at 1 crore as I would be getting about 8-9 lakhs annual interest which works out to Rs. 70000 a month Further I would be getting a pension of Rs, 30000, so together I would be having Rs. 1 lakh a ,month which, I reckoned, would be enough for my post retirement life to maintain my current standard of living.

      My present monthly living expenses is Rs. 25000.

      By the way, I would be getting about Rs. 12-15 lakhs when I retire as Gratuity and others.

      Thanks again.

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