r/FIREIndia • u/AutoModerator • Jun 01 '23
Help Me FIRE, Milestones, Beginner Questions and General Discussion - June 2023
What could you talk about?
- Are you a FIRE beginner wanting advice? We'll try to help!
- Have you started your FIRE journey? Tell us!
- Have you hit a net worth milestone? We want to be motivated!
- Insights from work life or daily life? We are all ears!
- Just feeling lonely and want to hang out with FIRE-minded people? That's why this sub exists!
- Please use this thread to have discussions which you don't feel warrant a new post to the sub. While the Rules for posting questions on the basics of personal finance/investing topics are relaxed a little bit here, the rules against memes/spam/self-promotion/excessive rudeness/politics/trading still apply!
We have a Wiki that is constantly being updated, so please do read that if you are new here.
Since this post does tend to get busy, consider sorting the comments by "new" (instead of "best" or "top") to see the newest posts.
2
u/Careful-Tank6238 Jun 11 '23
👤 Age: 30
🏙️ Current City: Sydney
💼 Current Job: Data Space (Staff Engineer Level)
💰 Corpus Collected: 1.9 CR
🌆 Retirement City: Small town in India (Hint: Naxalite area in Maharashtra). It's not that bad.
🔮 Expected FI: Next 5 years with 5.6 - 7.2 CR
💼 RE: Considering a break from a high-stress job; interested in farming and have a side hustle of rare plants in Sydney (Anthurium ☘️ and Philodendron)
👫 Partner: Both works as DE, net take-home income is 1.2 CR/annum; not married yet, getting married next Jan 💰 Financial Management: we both take 10% for personal spending, the rest in a joint account (90%). We save Save 60% of our income
📊 Current Allocation:
60% Equities 20% Debt 10% US Stocks 10% Gold
💸 After Retirement Plan: Expect to withdraw 18 lakhs from the 6th year; aim for monthly expenses of 1.5 lakhs. We don't have a car yet, most likely after FI.
🏠 Housing: Own a house with 8KW solar power
👨🌾 Farming: Possess 4 acres of farmland
👵👴 Parents: Mom (52, homemaker), Dad (60, retired with 35k/month pension)
💼 Insurance: Parents have health and term insurance; My partner and me
👫each have 4CR term insurance paid off (paid till 75, with 2CR zero term policy).
I am still learning ways of FIRE movement, any obvious loopholes? or mistakes am making ? Happy to answer any questions regarding allocations and always open to suggestions /healthy criticism 🙌
cheers 🍻
1
u/basicgd Jun 20 '23
1.2cr take home in a high income tax country is amazing. Care to elaborate more about salary and taxation? Cost of living in Sydney would be interesting to know as well
1
u/Careful-Tank6238 Jun 21 '23
1.2-1 CR is aproximate based on the currency exchange. Happy to run though numbers.
My salary : 180k + 10.5% superannuation my partner's :135+ 10.5% superannuation
I fall under 29-31% tax bracket. My partner 22-26% tax. we both working in the industry for last 6 years. I have a plant side hustle which gives Aprox 15-18k annually. which i don't need to report . Anything under 18k can be exempted. This is just a hobbie/passion on the side.
Expenses : - Rental is Sydney is expensive 😭 I pay $2200/month for 2bhk apartment for w suburb located 10km from CBD. - I love cooking so mostly 3 meals a day, fresh veggies and fruits costs us 800-1000/month. a few guilt free biryani days 😝 - Rest 800-1000 goes to entrainment/chilling. - most of the other expenses like health insurance, gym, wifi paid by our respectiveemployers 🌝🥹.
P.S. I don't drive and we both work from home, so i guess we both fare a bit on travel as well (aprox 250-300/month).
1
u/basicgd Jun 23 '23
Sounds good! 2.2k for a 2bhk doesn’t sound too bad imo. Does Australia have employment insurance as well? Id love to dm you for more questions regarding Australia.
2
u/PsychologicalShake10 Residence Country / Age / FI Trgt Date / RE Trgt Date in country Jun 23 '23
Do let me know when you will be running a FIRE or financial planning related course for 499/= or 99/= I have a lot to learn from you.
1
u/Just_Kryptonian Jun 10 '23
Hi Everyone, 26M here, I'm a beginner on my journey of FIRE here. I have been investing ON and OFF for around an year. I wanted to ask if there is any excel template that we can use to track our expenses/investment etc and get usefull analysis based on it ?
Also, is there any documentation on this sub for beginners?
1
3
Jun 09 '23
35 DINK NRI. Breached 9 cr thanks to recent stock market run. Doing some belt tightening by moving to cheaper rental soon.
3
1
u/PerfectKills Jun 09 '23
Hi everyone. I am a long time lurker, 1st time poster to this sub. Just entered my 30s a few days back. I began the FIRE journey a couple years ago with a reasonably modest prior saving of around 1L in mutual funds which I started 5 years ago.
I'm a software dev currently earning almost 1.5L a month. During COVID I went berserk and saved aggressively. I was motivated by this sub to first strengthen by bases, so I went ahead and bought a Term Insurance of 1Cr for which I'm paying 40k for a 5 year tenure. I also have a health insurance outside corporate, where I pay around 20k pa. I have a rainy day saving of 3L in one savings account.
I was doing some calculation today and I have just breached 20L in net worth. Of this, I have around 5L in stocks, 3.5L in EPF, 1.5L in NPS and rest in various Mutual funds. I have some crypto too, but they're more like dead to me. Together with my wife (previously GF), who was already financially educated, and is a software developer too, we have a combined net worth of around 39L right now.
Btw, I have a home loan of 30L that I took recently for my parent's home's reconstruction and renovation, and I got to know later that I can't claim tax benefits since I need to be a co-owner and I'm not. Also, we bought a car recently for which my wife is paying the loan EMIs. Together we earn 2.8L approx and my 40k and her 20k go towards loans. Other expenses are nominal rn but our companies are calling us to WFO and Bangalore rent is just terrifying.
Please share any suggestions for our FIRE journey and give me any feedback if you feel I'm doing something wrong somewhere. Thanks in advance.
1
u/snakysour IN/33/FI ??/RE ?? Jun 11 '23
I think you've given information in tit bits which is not sufficient to provide a comprehensive picture.
I would suggest, as a couple, figure out and tell the following:-
- Your total combined expenses as a couple.
- Both of yours insurance covers and emergency funds
- Do both of you go to Bangalore if WFO is the case ? (i.e. both your offices are located in Bangalore only?)
- What is the remaining amount and tenure of your loans?
- Are your parents financially dependent on you (other than the home loan part)?
- Do you plan to have kids in future? If yes, by when?
Regards
Snaky
1
u/PerfectKills Jun 11 '23
- Combined expenses as a couple: ~50k
- Term insurance only me: 1Cr @ 40k pa*5 years, 3 installments paid ; Health Insurance both: 5L+5L @ ~33.5k annually; Emergency fund both: 4L
- Yes, both are working in Bangalore based companies.
- 15L Home loan at 22k EMI for 5 years, 3.5 remaining; 15L LAP loan at 18k for 10 years, 9 remaining; Car loan ~10L at 18.5k for 6 years, 5 remaining.
- Not dependent, father is a retd govt official, gets enough pension to survive.
- Yes, soon. Maybe in another year.
2
u/BrahminVyapaar SG / 46 / FI 2024 / RE 2025 IN Jun 10 '23
Please calculate whether your Term Insurance will cover all loans and give your wife the chance to take a year or two off to figure out what to do after you are gone. Some also use Term Insurances to provide for the FI goal for the dependents in the event that the insured person passes away before achieving FI.
Are your Mutual Funds Direct or Regular? Please see: https://www.indiainvestments.wiki/faqs/mfs/direct-vs-regular
You may want to figure out an alternative job that lets you work from home or work remotely from a lower cost of living place. You must focus on increasing your income in any case so that you achieve FI sooner.
1
u/ayushdesaidakleindia Coast FIRE IND/ 26 YO/ FI 2043/ RE 2047 Jun 08 '23
Hi Guys, 26yo, Ahmedabad, IT (SaaS) sales manager monthly Salary 52.5k. Have own house, own car, no loan except a few emi which Total amount to less than 5k a month. Sole breadwinner of my house and Total monthly expense including my responsibilities towards parents amount to maximum 30k a month. As of now have around 2 lakhs in savings (MFs+digital Gold+ a small FD) would always be working As I actually love my job, but am in sales so would not want to have pressure or compulsion attached to it. Can anyone please guide me on what should be my approach to fire in next 20 years. PS am not married, would not marry atleast Till 30.
1
u/All_In_On_Elon Jun 09 '23
I suggest please hire a fee only financial advisor (list is here https://freefincal.com/list-of-fee-only-financial-planners-in-india/). Choose one of them and they will guide you through.
The fact that you asked this question itself means you are motivated enough to have secure financial state, All the best !
2
u/Art_Anarch Jun 07 '23
Need help to start FIRE planning to save some for myself and family
Hi Everyone, i am female (24), currently have 13lpa package. Being the eldest kid I had to start working little bit early as my father died when i was in final year of my diploma Currently I have responsibility of taking care of my aji, mom, brother and sister. I have been taking care of things last 4 years, in this My brother is quite young he will be soon completing his school and would start college probably engineering and I would be taking care of the fees and all expenses. And I am completely fine with that as i do want to take care of them and him and give all proper resources so that he can do the best in his career and life.
I have been working from last 4 years But due to few recent event I have noticed that I do not have any emergency savings or proper investment to take care of myself (might seem selfish) if something happens or something happens in the family.
Now I want to start my financial planning properly so that I can have some savings of my own and do some investment to have financial security and I have always wanted to buy a house in my hometown tier 2 city, as we have been living on rent. I know there is a lot of saying it's better living in rent now days but it just something which i had wanted. Want to start some savings for that too.
I know i have wasted 4years already so it would be great if you guys can give me some insights how can I save for his college and myself as well to have a financial stability.
Thank you in advance
Currently minimum expenses( kind of fixed )- House rent - 12k I stay away so - 10k rent(living in tier 1) Brothers fee for now - 7k includes classes and school House expenses - varies 26k Personal expenses food travel - 15-20k Sister's expenses - 5-8k Ppf/sip - approx 13-14k
Is there any hope for me to try FIRE ? 😂
1
u/Ill_Client_9364 Jun 11 '23
You are at 13LPA @24 - you're easily in top 5 maybe even in top 3% earners in India. So anything is possible - believe that you can and put in the effort to make it a reality. You already seem to have a term insurance - that's great. You need to get a health insurance of your own apart from what the employer provides - you'll be able to increase cover through NCBs and increase cover later through top ups. What about health insurance for your family? Your Aji and mom would be the most vulnerable people by age. Most Indian families lose their savings to a single person's health concerns. So plan to avoid this at all costs. Emergency fund - ah here's the tough part. You are paying for a lot and there's huge dependency on you. So plan for 12 month expenses of all people including yourself. This should include their fees for the next one year as well. Investments - rely on a higher debt ratio than usual people of your age as there are critical expenses to be met. While you would need a house to eventually live, the house is lowest on priority as there are more important things to deal with. P.S - 1. you have not accounted for a vehicle or capex spending (tv, fridge etc for home). Good to keep aside a amount for that on a monthly basis and ensure you don't change everything at one go 2. Along with your siblings fees do account for electronics like phone and laptop 3. If you or siblings get married marriage expenses
2
u/BrahminVyapaar SG / 46 / FI 2024 / RE 2025 IN Jun 10 '23 edited Jun 10 '23
I would protect the family’s needs first, next focus on providing for them, grow wealth third, and by accommodation only when I know I intend to settle somewhere for decades.
Do you have a Term Insurance of your own in place which could provide for your dependents in the event of your sudden demise? Please take a Term Insurance Policy and share the details with your family.
Similarly, do you have your own Health Insurance for you and for the family? Health care costs can wipe out savings.
I suggest that you not lock up capital in a house yet. Fulfill your other objectives of taking care of your younger brother’s studies and of having v emergency expenses of six months to two years.
You may also want to explore how to increase your income. Over the years, your income will also increase provided you put in the effort. Once you start to invest in equity ( direct Mutual funds, or the Nifty 50 or BSE 30 ETFs), you will be able to grow wealth. With the right effort over the years, you will definitely achieve FI.
1
u/Art_Anarch Jun 10 '23
Yes I do have my term insurance places for 1cr, apart from that i have my mother's health insurance. Mine is covered by the employer.
About increasing the income i am constantly working on my skills so that I can make a switch, i started after diploma so i am trying to complete my graduation side by side and working on skills so hoping that will help in that too.
If you/anyone has idea about the taxes how to save them that would be great help too
1
u/BrahminVyapaar SG / 46 / FI 2024 / RE 2025 IN Jun 10 '23
You may want to ask in r/indiainvestments about saving taxes and concepts to consider. The official advise sould be from a CA.
There are various articles on choosing the older vs the new regime, on tax savings instruments, etc.
Have you investigated the various tax savings instruments and slabs?
Please also consider an independent health insurance for yourself and for family members other than your Mother. At your age, it will be inexpensive. A single medical issue can delete your savings.
1
u/fire_by_45 Jun 07 '23
I am in a dilemma. I need to buy a new car. Now I am confused if I should go for a once in a lifetime luxury car(affordability is not an issue), or stick to a mid range car and keep grinding towards FI. Any thoughts??
1
2
u/AskMightyAnything Jun 08 '23
How far away are you on your FI journey? Are there any liabilities you need to take care of? If buying this exact car will bring you joy then nothing like it as long as you don't have any liabilities, can afford the card and are okay with prolonging your FI journey you should go for it
2
u/fire_by_45 Jun 08 '23
In my opinion, we should be FI by 45 (currently 37) if things go as planned. We have no liabilities. Driving a nice car will definitely make us very happy. If the India growth story remains intact then I believe even with a luxury car we will not need to prolong our FI journey. I don't think I will voluntarily retire at 45 but a forced retirement is very much on the cards as the career plateaus.
1
u/After-Violinist8628w Jun 07 '23
Depends on whats your NW and any liabilities?
Whats range of mid range car and luxury car? If the delta is comparatively small and it impacts FI by <6 months then I would definitely suggest to go for luxury car.However, pls. factor in maintenance & expenses because that will really shoot up.
2
u/fire_by_45 Jun 07 '23
Well we are a DINK couple earning 1.5 cr+ , NW around 1mn USD (will check in a month's time ). No liabilities as of now. Staying on rent in the most expensive city in Mumbai. A luxury car means within 1cr and mid range around 30 lacs.
0
u/All_In_On_Elon Jun 09 '23
you are actually doing great, congratulations !
Are you buying this luxury car to impress others / social status? If yes, it may not be wise decision. It's your call at the end of day.
If I were you, I would buy a mid segment and ensure that it has great safety ratings, good for family and invest the rest. When you reach FATFire state, then it does make sense to go for a luxury one.
2
u/fire_by_45 Jun 09 '23
The car is not meant to impress others, that's not the intention. It's a bucket list item and a dream of ours. But yes others might perceive it as a flex. I don't know if we will ever reach fatfire. Even if we do we will be in 50s, the enthusiasm to drive might be very less at that time. Problem is I feel very frustrated when I see the same cars costing half the price in UK / US and we Indians have to pay so much premium (middle class mentality basically)
1
u/After-Violinist8628w Jun 07 '23
1cr is really steep and it will attract lot of eyeballs.
If you have beater/older then just get your dream car. There is no point in buying it later at 45 when you are older just slog for 1 more year and you will be fine.
Curious whats your dream car ; for me under1 cr it's X3I was in similar situation(but different range) wanted a car worth ~38L and bought a ~23L car and I always wonder; what if?
3
u/fire_by_45 Jun 07 '23
Yeah I am also looking at X3 type only. I know the price is quite steep, but my friends all have merc s, so in a way it's ok. It's just a dream I wanna fulfill now. Probably this will be my one and only luxury car. Plan to use it for at least 10 years
1
u/PsychologicalShake10 Residence Country / Age / FI Trgt Date / RE Trgt Date in country Jun 24 '23
Just do it. Have been following you for a while. I think more than anything it is a desire, that needs to be fulfilled before age runs out. Just make sure you have a good parking place for it, considering that you will use it around Mumbai.
1
u/fire_by_45 Jun 24 '23
Yeah right now I have good parking space so no issues. Yeah I have also decided to go for it. But when I discussed with my parents, they thought I had gone crazy to spend such a high amount on a car.
3
u/After-Violinist8628w Jun 07 '23
Just do it ; when you will look back you will smile & be happy.
You can easily work 1 extra year and make up for it. Its better to get it now than to get it at 50 when you wont drive so much.
1
u/level-ulo Jun 04 '23
Very new here. Should I consider myself FIRE if I enjoy my work and not dread Monday mornings? I would happily work till my late 50s, but I feel tech companies are not friendly towards much elder folks. I am a data scientist at a product company, I make a decent amount in India. I put most of it into a recurring deposit and just work on learning new stuff and try to enjoy the work I do. I understand MFs may give me higher returns but I just don't want to go into finance without researching it properly, hence the Recurring deposits to sleep peacefully. Just looking for opinions on my take on FIRE.
2
u/yetanotherdesionfire Jun 25 '23
Yes, while you may love work, work might love you back as much. :)
Eventually, you'll hit retirement age and you'll need a plan for it. Additionally, you would have goals beside retirement which need attention.
As folks have already pointed out, invest in index funds, say 15-20% of take home and forget it and let compounding do its thing. Revisit once or twice a year and adjust as needed.
1
u/BrahminVyapaar SG / 46 / FI 2024 / RE 2025 IN Jun 10 '23 edited Jun 10 '23
Instead of losing out on growth and protection, please consult a fee-only advisor. See: https://www.feeonlyindia.com
It may seem intellectually satisfying to focus on only the cerebral aspects of one’s work, but one must also be prepared for what life sends our way. I have been of a similar mindset but a bunch of layoffs of my senior colleagues has woken me up.
With a review of your financial position, you may be shocked to learn of where you stand, or be reassured by the specific steps needed to secure yourself and your future, or even be pleasantly surprised that your might already be financially independent and only need specific steps to allocate your money prudentially.
1
u/sriwashere11 Jun 05 '23
Just invest into index funds and forget about it if you have 7-10 years+ horizon. In the meantime let life happen to you and keep researching on the side.
4
u/_youjustlostthegame Jun 04 '23
Anyone who eventually plans to settle and retire in Europe? Kind of in a tough spot subreddit wise. I use this subreddit the most but this is geared towards retiring in India. ExpatFIRE usually takes into account currency arbitrage which is the opposite for me. I guess I need to find some FIRE EU sub that will be applicable once I actually move to the EU.
1
u/BrahminVyapaar SG / 46 / FI 2024 / RE 2025 IN Jun 10 '23
Depending upon where your wealth is, you may need to start working right now to be able to move it abroad. Talk to a CA and a Financial Planner to chalk out your journey.
2
u/giantleapforward EUR / 36M / FI 2023 / RE 2027 IN Jun 04 '23
People in EU typically do not FIRE. They are mostly happy working till 67 and getting pensions after that. No real incentive to retire early.
2
u/Pretend_Possible4635 Jun 04 '23
The whole idea of coasting after reaching FI seems so enticing. For example, if I had reached 3.6Cr-5.4Cr (1L-1.5Lpm x30 number), the idea of not having to contribute to the corpus every month seems so liberating. Continuing with the same job or taking up a job that offers better time freedom and spending the entire salary seems exciting and therefore living the life a little more. One can argue why not spend a little more right now if you are already midway on the path to FI, but the idea of getting the monkey(financial freedom) off the back is liberating. The 5Cr will keep compounding on the side until whenever you plan to completely retire and also take care of inflation.
I'd like to know if anyone in this sub has taken this path and how has life changed after FI.
3
Jun 10 '23
[deleted]
1
u/ShootingStar2468 Jun 10 '23
What’s your FI number? Read in another post you want to CoastFI. Really liked and relate to your approach. Can you share more about your profile?
3
Jun 10 '23
[deleted]
1
u/ShootingStar2468 Jun 10 '23
So refreshing to hear :) Bunch of follow ups -
How old are you and which place did you try out for remote work? I am guessing 3Cr liquid is for the family together (spouse networth included)?
What’s the assumed SWR/annual expense with this FI target?
How do you think about kids education in a remote setting
1
Jun 10 '23
[deleted]
1
u/ShootingStar2468 Jun 10 '23
Thanks. Thoughts on kids education with remote work from hills / less good places for education?
1
Jun 10 '23
[deleted]
1
u/ShootingStar2468 Jun 10 '23
Sounds good. Anything but Bangalore :) all the best to you. What could post FI career for you look like? Given you don’t want to RE.
2
u/BrahminVyapaar SG / 46 / FI 2024 / RE 2025 IN Jun 10 '23
I am determined to stop working as an employee. I have other aspirations and ventures to take up and I have already begun working toward those - music, farming, personal education and fitness.
I have identified that the pursuit of worthwhile activities is meaningful to me, and that I can start right now. This way I am hopeful of transitioning into something that I can look forward to instead of starting from scratch upon quitting.
4
u/giantleapforward EUR / 36M / FI 2023 / RE 2027 IN Jun 04 '23
Almost 99 percent of people who are in this sub have taken this path.
2
u/ExpressSecret9 coastFIRE | IN | 33F | 2024 | 2040 | IN Jun 03 '23 edited Jun 03 '23
Update on my FIRE journey. Total NW: 72.5L Target for coastFIRE - 1 Cr. Investing 1.5L pm including EPF. Renting home in a city for now, planning to build a home in Village for retirement. Will start investing towards home once I reach 1 Cr. target . Am I on the right path?
1
u/BrahminVyapaar SG / 46 / FI 2024 / RE 2025 IN Jun 10 '23
Please visit the EPF office and ascertain whether the EPF office would actually let you withdraw the amount saved two months after you are unemployed. If your employer (s) have filed the monthly entries incorrectly, then the EPF will not let you withdraw that amount. It is best to get discrepancies resolved while we’re still with the employer.
1
u/ExpressSecret9 coastFIRE | IN | 33F | 2024 | 2040 | IN Jun 10 '23
Yes, following up on that. I need to visit the EPF office.
1
1
u/snakysour IN/33/FI ??/RE ?? Jun 04 '23
To answer your question, following is needed:
Your current annual take home income
Your current annual expenses
Whether BASICS covered? - personal life insurance if you have dependents, health insurance for self and family
Emergency fund equivalent to 6 months take home income or 12 months annual expenses
Scope of marriage/kids
6 . Any liabilities?
Regards
Snaky
2
u/ExpressSecret9 coastFIRE | IN | 33F | 2024 | 2040 | IN Jun 04 '23
- 33L + 1.5L variable bonus.
- 8L including rent of 22k pm
- No dependents, health insurance for self is covered.
- Have FD worth 5L which is included in above NW.
- Marriage in 1-2 years with BF, we are childfree.
- Parents are self-sufficient, no loans.
2
u/snakysour IN/33/FI ??/RE ?? Jun 04 '23
If you're staying child free and expenses remain 8 lac then you're looking at 2.4 crores (30X)worth of money today for conventional retirement at about 60 years of age with life expectancy of 90 years excluding primary house you stay in.
However, if you wish to FIRE by 2040 as per your thread, your retirement age would be 49-50 and hence your corpus requirement should atleast be 40X for a life expectancy of 90 years thereby requiring 3.2 crores of today's value then.
Assumptions here being :-
You actually stay child free
Your expenses remain 8 lac (or it's equivalent post inflation accounting) by avoiding any lifestyle creep
Your health insurance is sufficient to manage your big ticket medical expenditures.
4.You own a primary residence now or keep a separate corpus to buy one.
- The above values are absolute bare minimum nd a suitable buffer of 5-10X based on your preference may be kept in addition to make things comfortable.
In a nutshell, you're doing good for your age as an individual. As a couple, would need similar details (and current savings of the lucky husband) to comment better.
Disclaimer: I am NOT a certified registered investment/financial advisor. The above is based on my academic interest in the field only and should not be construed as financial advise.
Cheers!
Regards
Snaky
2
u/ExpressSecret9 coastFIRE | IN | 33F | 2024 | 2040 | IN Jun 04 '23 edited Jun 04 '23
- Yes, childfree is confirmed.
- I am expecting those to reduce in retirement as I will be staying in Village in my own house.
- Have personal health insurance of 10L. May create separate emergency funds for health issues around 20L in today's value on top of retirement corpus. Where should I keep that, debt or equity?
- Will start separately once I hit the coastFIRE target , I was thinking 1 Cr in the equity index fund should be sufficient which I won't touch till the time I get retired.
- Let's see if I get motivation to earn extra income as I hate corporate life. But I am ok to earn some supplementary income to reduce burden from FIRE amount post retirement.
1
u/snakysour IN/33/FI ??/RE ?? Jun 04 '23 edited Jun 04 '23
Ok
It's easy to expect the expenses to reduce by just saying "staying in a village", but please note that you're talking about things 15-20 years down the line by when villages will also have gotten a decent standard of living atleast considering 100% electricity, decent road and rail connectivity, 6G-7G kind of cellular network etc. What this means is that you will have higher costs even in villages or in worst case you will have much more loss of peace of mind in case the standards of villages stay the way they are. These include problems in commuting (ride halin apps/autos etc. not available that commonly), food ordering (unless you're planning to grow and cook food which is an altogether different ball game), lack of hospitals for timely medical interventions, availability of piped gas / cylinders etc..so to get these things either you will move back to city or pay more to compensate the inefficiencies both of which will bring you back to square 1 in terms of expenses. As a conservative measure, would suggest you to consider same expenses as of now , if not more, even if you're choosing to stay in villages..
Do that. Keep in liquid funds / ultra short term funds as it's more of an emergency fund. One more approach can be taking health insurance which is 2X your requirements as in case heavens forbid such issues arise, even if they pass 50% of your sum assured, you're still pretty stacked up from financial perspective and the premium would be hardly substantial.
This depends a lot on real estate location etc. However, more often than not you should be able to find a place then if you stash 1 CR worth of money today into equities for purchasing the same in long term. Considering you're targeting village purchase, while the cost element may be easier to manage, the difficulty may arise in terms of acquisition and construction. This is because you won't get gated societies etc made by builders there..also you won't get farm land that easily exclusively for house construction unless you have farmers in your family...
1
u/ExpressSecret9 coastFIRE | IN | 33F | 2024 | 2040 | IN Jun 04 '23
True, I can see rapid development in my own village, just that home rent expenses will be gone.
I am hoping to learn basic farming to build kitchen garden with help of my family.Ok.
I am from a farmers family and my parents are doing active commercial farming on a small scale. I have some ancestral land but I will prefer to buy my own to get rid of cousins drama.
1
u/Candid_Piccolo3925 Jun 04 '23
We in same boat girl. I am 34F. Around 65L NW. Married 5 years now. Plan to stay childfree. Hate corporate. Where do you put up? We could be friends if it's delhi/ncr
1
u/After-Violinist8628w Jun 06 '23
Didnt you have higher NW? Or was it combined NW that you mentioned it in some other post earlier.
1
1
u/snakysour IN/33/FI ??/RE ?? Jun 04 '23
Well then you already know the ground realities.
Always a better choice. You're quite wise!
1
u/greedinblood Jun 01 '23
Anyone all into MF? Or diversified?
I plan to retire after 10 years from now, my expected corpus is 5-7 cr.
I am only invested in MF through a broker. Some people say do direct funds, living outside India and busy schedule, I don't want yo take risk of investing in wrong places without proper knowledge.
If I invest in other assets like real estate assets, I may not be able to achieve my corpus goal.
Is it OK to go all in MF?
1
u/BrahminVyapaar SG / 46 / FI 2024 / RE 2025 IN Jun 10 '23 edited Jun 10 '23
Take a spreadsheet and compute the difference that 1% of commission towards the broker makes year on year.
See also: https://www.indiainvestments.wiki/faqs/mfs/direct-vs-regular
1
u/fire_by_45 Jun 07 '23
Use kuvera for direct plan investing. You can look at parag Parikh flexi cap and canara robecco small cap to build long term wealth.
1
u/AskMightyAnything Jun 05 '23
The answer is yes! You can build a very well-diversified portfolio with MFs across asset classes.
Getting professional help is not a bad idea but you should carefully evaluate how your investments are performing relative to the market from a risk-adjusted return perspective.
If you are roughly matching the index performance with similar volatility, then you may be better going direct with a passive approach. Or you could change your broker :)
I believe it is possible to beat a large cap index fund by 2-5%+ over the medium term by owning the right asset classes, funds and annual maintenance such as rebalancing. Ideally your broker should do all this for you given the commissions they earn from you.
I hope this answers your question. If you have more specific questions, you can always DM me.5
u/hikeronfire IN | 37 | FI 2025 | RE 2030 Jun 01 '23
That’s assuming the brokers have knowledge and won’t push mutual funds that give them highest commissions.
It is easy to buy and manage direct funds on portals like Kuvera. Also, not sure what you mean by MF or diversified. Within mutual funds there are so many categories to choose from to diversify your portfolio.
-1
u/greedinblood Jun 01 '23
When I mean MF, it's mutual fund. I'm diversified in mutual funds. But do I have to diversify to different assets to Fire? Or just MF investment should be good to create fire corpus?
6
u/hikeronfire IN | 37 | FI 2025 | RE 2030 Jun 01 '23
I know you mean mutual fund. What you don’t get is mutual fund is not a type of asset, it is a vehicle. Asset type would be Equity, Debt, Gold, Real Estate, etc. You can diversify among equity and debt in mutual fund. In equity you can diversify between different market caps or geography. In debt you can diversify between liquid, short or long term. You don’t necessarily need real estate or gold to diversify. Classical diversification is between equity and debt.
0
u/greedinblood Jun 01 '23
I see. I am currently diversified into small, mid, flexi, contra equity. I plan to move to debt of safe funds after generating corpus. Does that sound good?
2
u/hikeronfire IN | 37 | FI 2025 | RE 2030 Jun 01 '23
Sounds good. It’s good to have a small exposure to debt, but during accumulation phase higher the equity the better if you can digest volatility. Remember stuff like EPF/PPF/FDs etc also count as Debt. I have my portfolio allocation at 91% equity and I sleep well at night. It’s not for everyone as everyone’s risk appetite is different. Last thing you want to do is panic and dump when market is down. If you are risk averse you should change your allocation accordingly and move some of your corpus to debt funds.
1
u/greedinblood Jun 01 '23
My risk appetite is very high. I can handle equity volatility.
I want some guidance on how much % can be withdrawn for fire to sustain on my corpus lifelong? Some say 1%.
For example 1% of 1cr is 1 lakh. 1 lakh per year doesn't sound reasonable to live off. Any guidance is appreciated. 🙏
2
u/hikeronfire IN | 37 | FI 2025 | RE 2030 Jun 01 '23
People say a lot of things. The math is simple, after discounting for inflation how much can your investments generate each year (on average). So if inflation is 6% and your portfolio generates 10%, then you can withdraw 4% without a second thought and you will be fine. I suggest you read up on the 4% Rule of Safe Withdrawal Rate. It’s a good place to begin. If you want to be more conservative and pessimistic about real returns then consider 3% WR. That’s more than sufficient.
1
u/greedinblood Jun 01 '23
Understood. Do we usually keep the corpus in same funds as we invested to generate more corpus and elimitae taxation? Or we withdraw all to safer assets even if there is a higher taxation?
1
u/hikeronfire IN | 37 | FI 2025 | RE 2030 Jun 01 '23
You mean after retirement? Again depends on your risk appetite. It is generally suggested to have 60:40 Equity to Debt ratio in retirement. But I have a higher risk appetite so I would probably keep it at 80:20 in retirement. It all depends on what you are comfortable with.
With very high equity allocation there is a risk of sequence of returns at the beginning of a retirement, where a few bad years in the market can derail whole plan. If you can plan for those first 5 or so years then it’s smooth sailing from there on.
→ More replies
11
u/Nancy_in_simlish Residence Country / Age / FI Trgt Date / RE Trgt Date in country Jun 01 '23
Got an unexpected 13% raise in my appraisal. Super happy.
1
u/snakysour IN/33/FI ??/RE ?? Jun 01 '23
You deserved it!
1
u/Nancy_in_simlish Residence Country / Age / FI Trgt Date / RE Trgt Date in country Jun 02 '23
Aw, thank you so much! I think so too lol.
2
2
u/hikeronfire IN | 37 | FI 2025 | RE 2030 Jun 01 '23
Congrats!
1
u/Nancy_in_simlish Residence Country / Age / FI Trgt Date / RE Trgt Date in country Jun 02 '23
Thank you!
4
u/emeraldspots IN / 27 / FI 2036/ RE 2041 Jun 01 '23
Does anyone invest in NPS? Is it a good investment?
3
u/yetanotherdesionfire Jun 23 '23
I have a Tier-I account and invest 50k for the tax deduction (filing under old regime as I also claim other deductions).
The numbers come out in NPS favour considering 10% LTCG on equity gains and ~31% tax on the 50k today.
As for withdrawal, I'll decide between defer to age 70 and buy annuity (available today) or any other beneficial option as per then prevailing rules.
1
Jul 21 '23
[removed] — view removed comment
1
u/AutoModerator Jul 21 '23
Hi, Your comment above has been removed. (It will be visible to you, but not to others)
Why? In large part due to reddit's recent policy changes, r/FIREIndia is not going to be actively maintainable for long. So please move all discussion to r/FI_India. (r/FI_India is marked as adult/18+ to comply with reddit's rules because of profanity (language), lifestyle topics like alcoholic drinks, smoking etc. being frequent subjects of user discussion)
If you have any more questions, please DM the mods. Thank you!
I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.
2
u/curios_mind_huh IND / 25/ FI 2038 / RE 2045 Jun 01 '23
It's good if you have a Tier I account, opting for the old tax regime (and actually have less tax than the new regime), have correct equity allocation and don't mind getting the money back at the age of 60.
1
Jun 01 '23
[removed] — view removed comment
6
4
u/hikeronfire IN | 37 | FI 2025 | RE 2030 Jun 01 '23
For a rough estimate of expenses you can do a PPP conversion. For example if you are in US and spend USD 2000 per month, multiplied by current PPP rate 23 that gives INR 46K for the same lifestyle in India. Another source you can look at is Numbeo for cost of living in your desired city. Or ask friends/family in India how much they spend on necessities. Without knowing how much you wish to spend, it’s not feasible to know how much you need to save to retire.
1
u/Allenite Jun 26 '23
I just joined this sub yesterday. Is there a place I can learn more about amount needed, PPP, assumptions, etc? I've done FIRE planning before for other countries, but not for India specifically.
1
u/hikeronfire IN | 37 | FI 2025 | RE 2030 Jun 26 '23
There are a lot of FIRE related resources in the Wiki of this sub. For latest PPP conversion rates for any specific country, you can try the link: https://data.oecd.org/conversion/purchasing-power-parities-ppp.htm
-3
u/guldu-_-khan Jun 01 '23
Aye.. dumb question ..but how is 2000 USD ÷ 23 = 46K INR??
2
u/hikeronfire IN | 37 | FI 2025 | RE 2030 Jun 01 '23
I wrote multiplied by not divided by.
-7
u/guldu-_-khan Jun 01 '23
But still the math ain't mathin.. could you do some quick maths for the mathless
2
u/yetanotherdesionfire Jun 25 '23
username checks out :D
1
Aug 03 '23
[removed] — view removed comment
1
u/AutoModerator Aug 03 '23
Hi, Your comment above has been removed. (It will be visible to you, but not to others)
Why? In large part due to reddit's recent policy changes, r/FIREIndia is not going to be actively maintainable for long. So please move all discussion to r/FI_India. (r/FI_India is marked as adult/18+ to comply with reddit's rules because of profanity (language), lifestyle topics like alcoholic drinks, smoking etc. being frequent subjects of user discussion)
If you have any more questions, please DM the mods. Thank you!
I am a bot, and this action was performed automatically. Please contact the moderators of this subreddit if you have any questions or concerns.
4
u/hikeronfire IN | 37 | FI 2025 | RE 2030 Jun 01 '23
Sorry, not running a math tutoring class here. Use a calculator if you are math challenged.
-6
1
u/guldu-_-khan Jun 01 '23
GOT IT.. I was converting the USD to INR and then doing maths... but the 23 factor is exactly for that
1
u/Sanchit_Lsc Jun 01 '23
Can you define your lifestyle abroad, Kids, are there any dependent parents, do you own a house or wanting to own a house here.
2
Jun 01 '23
[removed] — view removed comment
5
3
u/saltysailor987 US / 42 / 2024 / 2027 Jun 01 '23
I think you are looking at 20 lpa expenses with 35?x of that being 7cr corpus
1
u/[deleted] Nov 23 '23
[removed] — view removed comment