Your Financial Plan

I am 40, working in a PSU. My wife is a homemaker. My elder son is in class 6 and the younger one in class 1. I am expecting salary hikes from 2017. I wish to enrol my son into IIT, for which I wish to spend for coaching. Do suggest investment options to reach the goals with my new surplus.


A four-year integrated IIT coaching programme costs ₹8 lakh. The total expense, including the school fees, will not exceed ₹12 lakh for 4 years from class nine.

Education: Assume that ₹5 lakh will be the IIT coaching fee for the first two years for your elder son. To reach the target in 30 months, invest ₹15,000 a month in mutual monthly income plan which would earn a return of 8.5 per centto reach the target.

To meet the ₹7 lakh expense for the next two years, invest ₹11,400 a month for the next 48 months which should earn a 12 per cent return. For his college admission earmark the insurance proceeds of ₹5.3 lakh.

Younger son’s education: Invest ₹7,400 a month to meet his college expense of ₹20 lakh. Earmark the current mutual fund SIP and increase it by ₹4,900.

Retirement: The present monthly expenses of ₹25,000 will be ₹97,000 after 20 years at a 7 per cent average inflation. So you will need to have a retirement corpus of ₹2.55 crore. The EPF contribution will account for ₹1.11 crore. Invest ₹14,500 a month to meet the shortfall of ₹1.44 crore.

The present current balance in EPF can be utilised for any escalation in second son’s education cost or to meet your post-retirement vocation plans. Follow an asset allocation of 60:30:10, respectively, in equity, debt and gold for plans regarding the younger son and retirement goals.

The writer is a SEBI registered investment advisor and founder

Send your queries to

Read the rest of this article by Signing up for Portfolio.It's completely free!

What You'll Get


This article is closed for comments.
Please Email the Editor