Your Financial Plan

I am 57, a Central government employee retiring in December 2019. My wife is a home-maker. Both my daughters are employed. My mother, 74, is my dependant. My pension will be ₹30,000. Should I take a loan to construct an upper-floor to create an asset?


It is not wise to take a loan closer to retirement. It is better to have financial assets than physical assets for more liquidity.

Investment strategy: Allow the mutual fund investment to grow till you are 75 and rebalance the portfolio whenever you get abnormal returns from equity.

Retirement: Your pension of ₹30,000 post-retirement is equivalent to a retirement corpus of ₹50 lakh to meet your monthly expenses until you turn 74. Your mutual funds and PPF can meet monthly expenses till you turn 88. Earmark ₹5 lakh from the retirement benefits as emergency fund.

Marriage: Use ₹20 lakh from fixed deposits and earmark ₹2 lakh for your vacations. The savings account balance can be set aside to meet post-marriage expenses. For your second daughter, save a part of her salary to meet the marriage expenses. Invest the surplus of ₹18,000 for post-marriage expenses or for any shortfall.

The writer is a SEBI-registered investment advisor and founder,

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