Hi all,
This is my first post here though I have been reading regularly. I have a clarification regarding our current financial situation. Hope to find suggestions here.
I am 32. My husband is 34. And we have 2 kids.
We have one apartment in my name, bought before marriage. It is worth Rs.90L as on date. We pay EMI towards the same. Fixed % of 8.5 from ICICI. Bought in 2005. Outstanding principal is Rs.11L today.
We purchased another apartment in 2012 as a joint loan. We live there. It is worth Rs.1.4Cr as on date. Bought on SBI Maxgain loan. ROI is 10.4%. Total outstanding as of date is 59L. We have also parked Rs.15L in Maxgain OD. So effective principal outstanding is Rs.44L.
Other than these two we have ZERO investments (discounting PF from our companies).
I am planning to quit soon. My husband will be able to manage both the EMIs from his salary.
We are caught in the dilemma whether to park all our extra monthly savings and our yearly bonus from time to time in the Maxgain account or to start a regular SIP in long term equity funds.
Husband says Maxgain effectively gives us guaranteed 10.4% taxfree returns and so we should look at closing out our loan first before starting SIP. He feels that instead of paying a SIP in the hope that it will give us good returns, we can park that money in the Maxgain account which gives 10.4% effectively and also provides good liquidity in case of emergency. Meanwhile I feel that we need to regularly invest in SIP for long term benefits.
What’s the experts’ take on this?
And a side question: while the interest from FDs are taxed, why is effective benefit got from deposit from SBI Maxgain not taxed? Is parking my money in SBI Maxgain OD account with ROI of 10.4% not effectively the same as having an FD which pays me 10.4%?
Regards,
Swapna