Your Financial Plan

I am 48, a government employee and my wife, 44, works for a quasi-government set-up. We have two sons. The elder is pursuing MBBS abroad, the younger is in class 10. I am eligible for pension of ₹30,000. I sold my old house and have been holding cash for a year. Is it a good idea to buy property now in Tiruchi, where I want to settle after retiring?


Happiness is more important than owning a house.

While you work, you will live in the office quarters. So, it makes sense to buy property in your village once you retire. The cost will be lower and without taking loans you can live comfortably over the next 10 years.

For your elder son’s education, deploy savings bank balance in mutual fund and withdraw annually 8 per cent to meet the cost. With the monthly surplus, go for an RD for ₹11,000 and use the chit fund to meet the shortfall for the second year. For the third year, withdraw from the existing mutual fund to meet the cost. For the fourth year shortfall, book profits from the MF.

Assuming your portfolio grows at 12 per cent (first three years at 4 per cent) after 11 years, at your wife’s retirement, the fund value will be ₹1.44 crore. With this you can buy property in your native village. Plan vacations with the surplus and keep a fund for emergency needs. Given your pension, monthly household expenses should not be an issue at retirement. Follow asset allocation of 60:40 in equity and debt.

The writer is a registered investment advisor and founder, Send your queries to

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