2. How We Approach…
Review of your current investments*
Developing your Wealth Plan*
Executing your Wealth Plan*
Reporting & reviewing your Wealth Status*
.
3. Financial Goals
2022 : 54 lakhs Lump sum for Daughter’s Marriage
2030 onwards : 5 lakhs /month for 20 years
Legacy Planning
4. Assumptions Taken
2015-16 : Son’s Marriage (taken care)
2022 : Daughter’s marriage : 25 lakhs present cost ,
(10% inflation adjust = 54 lakhs)
Current Expense : 1 lakh per month
( 4.17 lakhs in 2030 plus medical costs)
Working Till 2030
DEBT/FD IN BANK : 25 LAKHS
All inflation adjusted at 10% same at FD rate.
Taxation : 30% slab
5. Advice :2015
1 FMP + 1 TAX FREE BOND + 1 NBFC FD
2015 PORTFOLIO OF EQUITY PORTFOLIO
REACHES 10 LAKHS,
SIP OF 12 K/Month
1.5 LAKHS TAX INVESTMENT FOR REST OF YEARS
(1.2 + 0.3)
Shift matured ELSS portfolio into Debt
Hence Annual Investment = (3+1.4+1.2+0.3) lakhs
6. Debt Equity Ratio : Current
Scenario
AGE DEBT (%) EQUITY(%)
54 40 60
56 50 50
58 60 40
60 70 30
62 80 20
65 90 10
7. Why NBFC FD and Tax Free Bonds ?
Higher rate of return than Normal Bank FD
Indexation benefit
Tax Free Income
Above All “ They Can Be Sold In Secondary Market
When Interest Rates Will Fall Down”. They will fetch
better returns.
10. Why Shift Matured ELSS to Debt
Component ?
After a gap of 3 years ( i.e. 2018 onwards), each year we will
have 1.2 lakhs of ELSS matured, to save Market Risk.
Average Return on ELSS 14%
1.2(1.15)^3 = 1.82 lakhs
At Present Value also, we are investing 1.8 lakhs/year into
debt from 2018 onwards. It is also increasing “Debt”
proportion in Portfolio.
http://articles.economictimes.indiatimes.com/2011-01-24/news/28424548_1_capital-protection-equity-fund-
markets-rise
http://articles.economictimes.indiatimes.com/2012-08-13/news/33182484_1_capital-protection-funds-debt-
funds-equity-funds
http://businesstoday.intoday.in/story/capital-protection-funds-fixed-maturily-plans-good-
investment/1/193577.html
11. SIP OF 12K / Month
Current SIP : 7 k
Thematic SIP : 5k
Infrastructure Based : High Growth :2.5 k
Pharma Based : Necessary Product: 2.5 k
12. 2022 : DAUGHTER’S MARRIAGE :
Situation and Solution
54 LAKHS : No Compromise
8 years time horizon
Scenario 1 :
Assumed 25 lakhs bank FD at 10% interest will become 53.58 lakhs in 2022. (net of taxes 37.1
lakhs if per year FD or 20% with Indexation)
Liquidate 5 lakhs of present worth of stocks (Agewise Debt equity) @15% Sensex = 15.3 lakhs
Scenario 2 :
Due to contingency Bank FD of 10 lakhs only in 2016.
Solution : 10x(1.1)^8 = 21.4 lakhs (net of taxes 14.7 lakhs if per year FD or 20% with Indexation)
Liquidate 5 lakhs of present worth of stocks (Agewise Debt equity) @15% Sensex = 15.3 lakh
Remaining Amount will be Well taken care by 9 NBFC FDs ( from 2014 to 2022) : FD purchased in 2014
will value 3 lakhs in 2022
13. Portfolio (2023): Present Day
Scenario
5 lakhs (present value) Stocks
All MFs remained intact that includes SIP and ELSS
All FMPs and Tax Free Bonds.
Remaining Bank FDs
Whole “PPF” is untouched.
14. Retirement Options :- Receivable
Income
SIP at average equity return per month:-
12 k(1.17)^15 = 126 k/month
• Initial Investment in Bonds 3lakhs/yr will fetch 13.78
lakhs/year = 114 k/month
• 2018 onwards Investment in bonds 4lakhs/yr will fetch
16.55 lakhs/yr = 130 k/month
• 5 lakhs present day stock will become 28 lakhs in 2026 and
53 lakhs in 2030 at 17% annual return. This 52 lakhs in FD
will give 5.3 lakhs/Yr return.
• Hence Income from stocks =44 k per month
• PPF maturity … Amount @9.5% compounded annually.
Approx 40 K per month.
15. Are we prepared ??
Income Required per month = 5 lakhs including
Medical Cost
Income generated per month = (116+130+44+40) k
330 k approx 3.3 lakhs
• Deficiency of 1.7 lakhs per month will be covered by
alternate source of Income or by increasing Equity
Investment of approx same portfolio.
• Need to create one assured return asset which fetch
good return and work as Legacy too.
17. ELSS Options: 2 for 0.6 lakhs each
Name 3 Yr Return 5 Yr Return
Axis Long term
Equity
34.33 25.04
Icici Pru Regular
Tax Plan
26.92 18.52
Reliance Tax Saver 34.17 23.31
Franklin India Tax
Shield
26.27 19.81
18. Infra SIP Options
Name1 1 Yr 3 Yr
Franklin Built India 115 37
Franklin India Smaller
Companies India
103 24.96
Can Robeco
Infrastructure funds
94.67 20.13
19. Pharmacy SIPS
Name 1 Yr return 2 Yr Return 3 Yr Return
SBI Pharma 59.1 46.1 39.6
Reliance
Pharma
54.7 41.9 33.6
UTI Pharma 52.3 40.7 33.7
20. Debt Funds
Name 1 Yr Return 3 Yr Return 5 Yr Return
Birla Sunlife
Dynamic Bond
16.04 10.79 9.58
DSP BR Strategic 16.50 10.47 9.02
Icici Pru Long
Term
21.30 13.24 10.62
SBI Magnum Gilt
Fund
23.52 12.6 10.29
Frankin India
Short term Income
Plan
12.51 10.65 9.44
21. 3 YR Structured Products
Name 1 Yr Rreturn 2 Yr Return
Birla SL 1093 DG 35.8 17.7
Birla SL 1094 Sr 12 34.7 17.2
Axis Pro 33.2 16.3
Icici Pru Sr 4E 36 M 20.1
Icici Pru CPO Fund Sr 36
M
14.4 12.1
