Amit Acharya, 51, lives in Raipur with his housewife wife and two children aged 16 and 10. He gets a salary of Rs 2.25 lakh per month. His portfolio includes immovable assets worth Rs 1.03 crore, which includes a self-occupied house and another Investment. He is also repaying a home loan of Rs 25 lakh along with an EMI of Rs 35,000. His other investments include equity of Rs 1.08 crore as mutual funds and Rs 55.7 lakh in debt and Rs 4.6 lakh in cash in the form of stocks, EPF and PPF. His goals include building an emergency fund, saving for children’s education and weddings, and retirement.

portfolio

cash flow

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Financial planner Pankaj Malde suggests starting with an emergency corpus of Rs 4.77 lakh, which is equivalent to three months’ expenses. He can do this by allocating his cash and investing it in ultra short-term or arbitrage funds. He should extend this fund to six months’ expenses at the earliest after the increase in income. Acharya wants to save for his children’s education goals, who are two and eight years away. For this they will need Rs 57 lakh and Rs 86 lakh respectively. to get prior aim, he may allot a part of his shares of Rs 50 lakh for this target. Malde strongly advised him to sell shares worth Rs 50 lakh and invest in a floating rate debt fund or an arbitrage fund. For the latter target, he can allocate a part of his hybrid fund of Rs 9.22 lakh and start an SIP of Rs 45,000 in hybrid equity fund.

how to invest for goals

They have estimated the requirement of Rs 65 lakh and Rs 96.5 lakh for the marriage of children at nine and 15 years, respectively. For the former, he can allocate stock and maturity proceeds of Rs 17 lakh to a traditional insurance plan. For the latter, he can allocate stocks worth Rs 13.1 lakh and maturity proceeds of another traditional insurance plan. They are advised to sell their shares and invest this amount in diversified equity funds. For retirement in nine years, Acharya will need Rs 3.5 crore, and he can allocate his real estate, EPF, PPF and equity funds. He will also have to start an SIP of Rs 16,000 in a diversified equity fund.

For life insurance, he has five traditional plans and a term plan of Rs 1 crore. Malde suggests that he continue with these plans. For health, he has bought a Rs 5 lakh plan from his employer and a family floater plan of Rs 5 lakh himself. Malde suggests buying a plan of Rs 10 lakh instead of Rs 3,167 per month. They should also opt for Rs 50 lakh accident disability plan for Rs 500 per month.

insurance portfolio

Financial Planning by Pankaj Malde Certified Financial Planner

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