2. Birth & Education Earning Years Retirement
38 yrs22 yrs Over 25 - 30 yrs
Housing
Child’s Education
Child’s Marriage
Phase I Phase IIIPhase II
Income
Age
Marriage
Children
22 yrs 60 yrs
Age
4. Present Value (Current Investment needed for a particular goal. Can
also be understood as Single Premium)
Future Value (Value of the investment in the future. Can also be
understood as Maturity Amount)
Payment (The value of investment required periodically to fulfill a
particular goal. Can also be understood as mode of premium)
Nper (Time required to meet a particular goal. Can also be understood
as premium paying term)
Interest (Return required to meet a particular goal)
Effective Rate of Return
Post Tax and Pre Tax Returns
IRR (Accrued return for the cashflow)
NPV (Value of uneven cashflow today)
Rule 72
Rule 69
Time Value of Money.xlsx
5. Calculate HLV to recommend adequate insurance cover
for Mr. Raghav: Age – 30 years, Retirement age - 60 years.
He is Asst. Vice president. His monthly salary is 55,000.
He pays professional tax of Rs.3,000 and income tax
subject to allowable deductions (tax paid) Rs.132,000,
reasonable self - maintenance expenditure estimated at
Rs. 45000 p.a., life insurance premium for self Rs.18,000
with total sum assured Rs.5,00,000. For wife and child he
pays insurance premium of Rs.10,500 and Rs.6,500
respectively. Assuming rate of interest for capitalization of
future income as 8.58% recommend adequate additional
insurance for Mr. Raghav
Human Life Value.xlsx
6. Seema is 1 year old and her dad wants her to
pursue an MBA degree course. For this the
amount required is Rs. 8, 00,000 in today's terms
which will increase @ 6% p.a. and the amount is
required after 20 years. How much per year
should her father start saving from now on if the
rate of return on investment is expected to be
8.58% p.a.?
Child Education.xlsx
7. The cost of marriage today is 2000000 which is
increasing at a moderate 5% due to inflation. Mr.
XYZ is interested in accumulating money for her
daughters marriage which is after 20 years.
Please help him understand how much to invest
every year (If expected return on investment is
8.58%)?
Childs Marriage.xlsx
8. Mr. Shah 35 years old is now concerned about his
retirement. He wants to make provisions in such a way
that he can maintain his present standard of living
even after retirement when his actual income stops.
His current annual expenses are 360000. Inflation is
5% and Interest he can earn on investments is 8.58%.
He is suppose to retire when he turns 60. Please
advice him about the investments he need to do every
year?
Retirement Planning.xlsx
9. Mr. Javeri is 28 years old and married. His wife is
25 years old and they have a 2 years old
daughter. His current annual income is 1500000
and Current expenses are 275000. He has a
home loan EMI of 12000. His current investments
are 1000000. He wants you to help him plan for
his Retirement, Child Marriage, Childs Education,
Investments. Please prepare a financial plan
