Your Financial Plan

I am 36 and I run ice-cream parlours. My wife assists me in the business. My daughter is 4. My parents are financially independent. Since we have daily collection, all my investments are in chit funds and gold chit. Reading BusinessLine has spurred me to change my investment pattern. What is the right way to invest to attain my long- term goals?


Investing in an unregulated chit for higher return is an unwarranted risk. Also, investing in gold chit for your daughter’s marriage 20 years away is not a good idea.

She may not like the designs on offer at the time of her marriage and you may have to purchase new jewellery.

Once the current chit is over, stop saving for her marriage. Since you wish to give her 30 sovereigns, buy just a gram a month till her marriage.

For her marriage expenses, once the car EMI is over, accumulate for this goal.

With your current surplus, save ₹20 lakh for home renovation and for the rest take a home loan. Similarly, for business expansion, avail loan for ₹10 lakh. In both cases you can deduct the EMI from income. That will bring down your tax outgo.

For children’s education, earmark the insurance maturity of ₹4 lakh and for the balance ₹9 lakh invest ₹4,200 every month. Buy term insurance for ₹1.5 crore and increase your health policy to ₹5 lakh. Follow asset allocation of 55:40:5 in equity MF, debt and gold respectively.

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

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