Dear All,
I have been reading through the forum posts for a few days now. I regret not being through this website earlier, when I was starting my initial investments, and mostly I made all the investments to save my taxes rather than creating wealth or retirement planning. I am 31 years of age now. I have an income of approx 45k per month.
I have made the following investments till date:
a) LIC – Jeevan saral policy: Rs 4,00,000 cover with a premium of Rs 19600/- p.a from 2010
b) LIC- WHole life limited payment- Rs 1,00,000 cover with a premium of Rs 3056/- p.a from 2010
c) Health insurance for myself (3,50,000 limit) and for my mom and my wife (4,00,000 ) limit
d) Birla sunlife insurance (ULIP) for myself (1,50,000) with a yearly premium of Rs14748/- started from 2006.
e) PPF contributions (for tax saving purposes till date) Rs 23,500 approx
Now after reading through Jagoinvestor posts and forums, I have decided/felt that:
a)I have invested in some wrong policies like LIC and Birla Sunlife insurance (ULIP).
b) I also feel that I should increase my insurance cover to at least 50 lacs, per the calculations given in the forums. But at the same time, I feel that either by surrendering the LIC policies or the Birla sunlife insurance, I would lose a whole chunk of money invssted till date.
c) I also need to start an emergency fund.
d) I also need to start investing in a mutual fund scheme (sip or otherwise)
e) I also need to start saving for my retirement from now onwards.
My questions to the respected forum members/ Jagoinvestor are the following:
a) Should i surrender/make paid up all the traditional policies and invest in a term policy rather. Or should I keep the old investments as it is and increase my life cover by buying another term insurance. I have calculated that if I give up the LIC policies, I wont get anything and if I give up the Birla sunlife insurance, I would get an amount which is very less than even that I have given till date.
b) Which mutual funds should I start investing into. I have heard that equity funds are the best ones to invest in ? Is that correct?
c) How do I plan/save for the retirement. The calculators in jagoinvestors inform that I need to save/invest at least Rs 10,000 per month (based on the logic that if I need at least 30,000 per month in order to sustain in 2013, and this would be inflated to approx 1,98,431 in 2043 in order to fulfill the requirements per year after my retirement till my death. I am confused by these calculations and would like to ask what exactly should one do to save for his/her retirement?
Please do respond
Thank you so much for spending your valuable time going through my query.