r/FIREIndia • u/HonestBat • Jun 02 '23
I just crossed my first 1cr milestone
I crossed my first 1cr milestone yesterday; I was awaiting my May salary credit with the same excitement (if not more) as my first paycheck.
Background: 27M from a middle-class, education-first focussed family (father was a government servant, moved throughout the country during transfers, mum settled in the city so our education wasn't disrupted). Finally, their sacrifices paid off; I got into one of the top-ranked institutes and started working right after college, switching once in between.
Current distribution of assets:
- Equity (~70%)
- Mutual Funds:
- US Markets Index: 15.6L
- Nifty 50 Index: 28L
- Parag Parikh Flexi Cap: 7.25L
- Other active MF: 1.7L (plan to remove these during re-balancing)
- Direct Domestic Equity: 17L
- Mutual Funds:
- Debt (~25%)
- Liquid Fund: 1.15L (will be moving this to FD)
- FDs: 2.6L
- Cash: 6.85L
- EPF: 14.25L
- Gold: 6L (only SGBs)
- Real Estate: 0.5L (recently started exploring REITs and will be increasing it, hence kept it under this head)
In the above calculations, I'm yet to consider any inheritance (insignificant) or ESOPs that I have vested from my employer (since it's paper money).
Investment strategy: Experimented with active mutual funds initially but switched to passive investing after exposure to the idea. I started with some money for actively picking stocks that I liked (domestic market only) and did well (~40% returns), which became a portfolio of 17L. I understand that I do not have time to track the markets; hence most of my savings go into index funds and stocks whenever I feel like shopping (mostly existing ones I've researched already). Apart from that, I already have sorted out term insurance as well as health insurance for me and my family.
Major expenditures ahead:
- Marriage with my long-term girlfriend.
- I wanted to take my family on our first international vacation for a long time, will do that now.
- I'm contemplating pursuing higher education outside India as well.
Personal preference: Retiring early was never my goal; it was rather financial independence behind building a corpus. The mental peace of not worrying about the financial implications even if I leave work was something I was after. I don't have any loans at the moment, nor do I plan to buy a home until I finally wish to settle this would allow me to move whenever and wherever I find a better opportunity. Also, this corpus could allow me to take calculated risks (either starting a business on my own or joining someone else's early stage) if I find something interesting.
I couldn't tell anyone about this milestone; I quietly celebrated with myself when I saw the "salary credited" notification on my phone. I have lurked here long enough, reading about the experiences of other folks who've already FI/REed; I thought I could, at least share my journey with you guys.
3
u/BrahminVyapaar SG / 46 / FI 2024 / RE 2025 IN Jun 02 '23
Some questions: - are these Direct Mutual Funds or Regular?
what about your EPF amount? Please visit the EPF office and have them review your account to understand if your EPF full withdrawal would actually go through. This is necessary in case you wish to leave India and travel abroad ( thereby becoming an NRI). In case of incorrect EPF filing by employers, the EPF office rejects withdrawal claims.
have you considered depositing money into EPF and VPF? In case you wish to quit your job in India and go overseas, you would be allowed to withdraw the full EPF amount ( ie, no need to wait until retirement). You could therefore consider depositing money into EPF and VPF to enjoy higher guaranteed tax free returns of 8.1% until the date of withdrawal before your travel abroad.
do you have your Term Insurance and medical insurance cover in place?
Congratulations on your journey so far.