How should I advise my friend to invest his 1.2 crores recieved on retirement ?

POSTED BY sandhu b ON March 26, 2014 8:19 pm COMMENTS (8)

My close friend has retired last month and received 1.2 crore. he asked me for advise on investment because he found me reading some books and blogs on this topic, but actually i have little idea overall, so i thought of asking all of you learned persons for some idea and also started making some plan for him.

as i am a regular reader of this forum and have benefitted great myself so i asked him various questions and answers are as below ( as i understand these are few basics required to make some plan for his investing) :-

he is 53 year old, retired last month, received 1.2 crore from his employer, will get govt pension of 50000 pm, wife employed in govt job 47 yr and earning 43000 pm, only daughter 19 yr old , student of 1 st year graduation ( likely to study for at least 5 more years before start earning or get married),  pension and wife pay of about 90000 pm more than sufficient for monthly expenses including daughter education, only goal is to grow wealth and hand over to daughter after she turns 25 yr and/or to fund her PG (masters in english literature) abroad (UK) if she decides to go and which will not be possible with pay+pension.

if you give me suggestion, i will formulate a plan and put it on this forum for further discussion.

specific suggestions and specific queries will be appreciated. generalised info is already cluttering the net.


8 replies on this article “How should I advise my friend to invest his 1.2 crores recieved on retirement ?”

  1. Viren Phansalkar says:

    Yes, finally we would get something which we can refer at point blank and then decide for ourselves. Thank you Ashal.

  2. ashalanshu says:

    Dear Viren, I w’d take note of your request and ‘ll try to write one post. 🙂



  3. Viren Phansalkar says:

    Yes Ashal, agreed that thinking always differ from case to case basis. However, we can still have some guide.
    People can refer that guide and then tailor their own suit.
    Example: you can specify that following are the options that you may follow:
    1. FD with interest rate of 8 (say current rate), get annual or quaterly interest and use it.
    2. MIP plans.. few details on this.
    3. FMPs… few details on this like how to ladder these instruments….

    I am not able to think on general basis and that the reason i requested you 😀

  4. ashalanshu says:

    Dear Viren, I can write a blog post that’s not a big issue. The problem lies elsewhere. I w’d write a generic post and you know very well that post retirement (even pre retirement) one size does not fit all. 🙂



  5. Viren Phansalkar says:

    @Ashal: We already have many articles on how to accumulate retirement corpus.. however, what exactly we must do with the corpus post retirement is not easily available information…. Can we have your post on exactly this topic i.e. what to do with the retirement corpus once you have accumulated that on AIFW blog?

  6. ashalanshu says:

    Dear Rokhan, The person in question is in need of advice otherwise within next few months, his money ‘ll be invested in all kind of insurance policies through his bank executies. 🙂



  7. Rokhan says:

    “he is 53 year old, retired last month, received 1.2 crore from his employer, will get govt pension of 50000 pm”

    What kind of job allows you to retire at 53 while getting a more than handsome gratuity from private employer + monthly pension from government??

    Please tell us so we may apply 😛
    Regarding your query, I doubt he need any help with finances

  8. ashalanshu says:

    Dear Sandhu, as pension and salary are taking care off regular mly expenses, my take, ask him to keep around 6 months’ expense money as emergency fund in SB account. After that another 6 months’ in Liquid fund.

    Now ask him to park all the money into debt fund. From there, depending upon his own taste, he may start STP to invest in Eq. funds, say 20-30K mly. If he is against Eq. funds, ask him to opt for MIP for at least 25% corpus and do not touch the same till next 10-15 years (in MIP).



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