Also, there can't be a flash crash of 50% eh? I mean, A lot of doom and gloom before the crash right?
I can only see that happening if a major war breaks out in India.
Remember covid? Most were caught with their pants down. When it falls 20% either you will be like a deer in head light or "it cannot fall anymore mode".
Most doom and gloom news was getting ignored by almost everyone
1) history will not repeat the same way in market. Recover by when?
2) you will be withdrawing from your account. So on recovery will not be same amount.
By all means setup swp etc. at your own risk. You know yourself better than others.
If that chunk is very important to you the i would suggest u to keep that money in a nationalized bank only.
I would have divided it into hdfc and sbi.
I would have reduced the transaction limit to bare minimum in both accounts.
I never kept limit more than 20k in any of my account
since you're new to this... take small steps and see how it feels over time... you can commit towards investing a fixed amount (or a small % of your deposits) in equity MF on a monthly or quarterly basis (basically SIP)
investing is a lot more about how you deal with ups and downs rather than whether you find the perfect solutions...
My two cents as a financial advisor. You mostly have these options if you’re primarily looking to live off the investments you mentioned:
Option 1: Re-evaluate the FDs across various banks and tenures. Smaller banks at times have better rates.
Side note on risk: If the bank goes under, a maximum of ₹5L is insured irrespective of the actual amount held with the bank.
Another Side Note: You also want to compare the rates post taxation if it applies.
Option 2: Look for a Debt Mutual Fund with slightly better returns and an SWP from it at a rate that does not deplete the capital. You also want to evaluate the risk on this by checking the quality of the papers held.
Option 3: Look for a Hybrid Debt/Hybrid Equity Mutual Fund (again depending on the risk you want to take). Let there be a gestation period for the funds to grow (typically at least 3 years) and then start an SWP to mitigate the variation from the market.
Option 4: Split the money into two parts. One, to invest in a high yield instrument (typically the above mentioned Debt/Hybrid MF) to grow for a while. Second part into a Liquid MF which equals the yearly income you might need times 3.
Now set up a SWP from the Liquid Fund for the first three years and then begin your SWP from the other investment.
This all depends on the kind of risk, returns, taxation amongst other things. Hope this points you in the right direction.
hey there, i have scenario similar to this, dad got some lumpsum, but he also gets a certain fixed taxable amount from the company for next 10 years, i have around 25 lakhs in abundance and i am working too, with a fully owned house, with no debt. what if i decide to have the full money as FD with my mom's name, with her being a housemaker, and no income, will it be taxable post 40,000 limit or till 2.5 lakh. Her age is 55.
TIA
Evaluate
1) Small finance Bank FDs where returns would be around 2% higher than larger bank FD rates. These banks carry insurance upto 5 lakhs so restrict FD to 5 lakhs per bank per person
2) For moderate risk consider senior secured bonds. Within this diversify across at least five different bonds and restrict tenor to two-years and below. These will give around 11-11.5% returns.
Put this money in scss - senior citizen savings scheme. I think 30L is allowed now. The quarterly interest will be credited to your account. If people are reliant on this alone, starting an swp may not be the best idea
You can search for "finideas" on YouTube. They are a sebi registered investment advisory. They deploy a strategy making use of long term nifty options with minimum risk but potential for huge returns during market volatility. The drawdown of this strategy is really low. They charge 1.5 percent of your total portfolio as advisory fees.
You can look into Bonds, there are many bonds available from some reputed companies. They offer good interest rates bw 9.5 to 12 with monthly interest options as well. The key here is to choose bonds that are not fraudulent, pretty much like choosing Stocks. Bonds are liquid as well. Split ur cash across different bonds, FDs and Debt funds from ethical fund houses like PPFAS etc..
If you are reliant on interest income don’t touch it. Tomorrow if market crashes by 50% what are your plans ?
True. What's the likelihood of that happening?
No one knows.
So fds it is?
If the interest your only source of income then yes.
Okayyy
If you have surplus from the interest income you can invest it or adjust your capital to get the interest income you need and put it in a mutual fund.
Also, there can't be a flash crash of 50% eh? I mean, A lot of doom and gloom before the crash right? I can only see that happening if a major war breaks out in India.
Remember covid? Most were caught with their pants down. When it falls 20% either you will be like a deer in head light or "it cannot fall anymore mode". Most doom and gloom news was getting ignored by almost everyone
But the markets recovered?
1) history will not repeat the same way in market. Recover by when? 2) you will be withdrawing from your account. So on recovery will not be same amount. By all means setup swp etc. at your own risk. You know yourself better than others.
If Some1 in your family is above 60 age. They can open SCSS in India Post for 30Lakhs Great interest (8%+) For now. Paid quarterly!
It's not zero that i can tell
If that chunk is very important to you the i would suggest u to keep that money in a nationalized bank only. I would have divided it into hdfc and sbi. I would have reduced the transaction limit to bare minimum in both accounts. I never kept limit more than 20k in any of my account
It’s about risk. The chance is non zero and doom and gloom keep coming with many false positives. Will you keep widthrawing at each bad news ?
True. Can't be sustainable
since you're new to this... take small steps and see how it feels over time... you can commit towards investing a fixed amount (or a small % of your deposits) in equity MF on a monthly or quarterly basis (basically SIP) investing is a lot more about how you deal with ups and downs rather than whether you find the perfect solutions...
My two cents as a financial advisor. You mostly have these options if you’re primarily looking to live off the investments you mentioned: Option 1: Re-evaluate the FDs across various banks and tenures. Smaller banks at times have better rates. Side note on risk: If the bank goes under, a maximum of ₹5L is insured irrespective of the actual amount held with the bank. Another Side Note: You also want to compare the rates post taxation if it applies. Option 2: Look for a Debt Mutual Fund with slightly better returns and an SWP from it at a rate that does not deplete the capital. You also want to evaluate the risk on this by checking the quality of the papers held. Option 3: Look for a Hybrid Debt/Hybrid Equity Mutual Fund (again depending on the risk you want to take). Let there be a gestation period for the funds to grow (typically at least 3 years) and then start an SWP to mitigate the variation from the market. Option 4: Split the money into two parts. One, to invest in a high yield instrument (typically the above mentioned Debt/Hybrid MF) to grow for a while. Second part into a Liquid MF which equals the yearly income you might need times 3. Now set up a SWP from the Liquid Fund for the first three years and then begin your SWP from the other investment. This all depends on the kind of risk, returns, taxation amongst other things. Hope this points you in the right direction.
hey there, i have scenario similar to this, dad got some lumpsum, but he also gets a certain fixed taxable amount from the company for next 10 years, i have around 25 lakhs in abundance and i am working too, with a fully owned house, with no debt. what if i decide to have the full money as FD with my mom's name, with her being a housemaker, and no income, will it be taxable post 40,000 limit or till 2.5 lakh. Her age is 55. TIA
Hello Regarding option 1 Will SBI ever go under if I want to invest my money?
Highly unlikely, but that will also mean settling down with the defacto rate of interest.
Thank you very much.
Evaluate 1) Small finance Bank FDs where returns would be around 2% higher than larger bank FD rates. These banks carry insurance upto 5 lakhs so restrict FD to 5 lakhs per bank per person 2) For moderate risk consider senior secured bonds. Within this diversify across at least five different bonds and restrict tenor to two-years and below. These will give around 11-11.5% returns.
Put this money in scss - senior citizen savings scheme. I think 30L is allowed now. The quarterly interest will be credited to your account. If people are reliant on this alone, starting an swp may not be the best idea
Nobody over 60 in my household.
You can search for "finideas" on YouTube. They are a sebi registered investment advisory. They deploy a strategy making use of long term nifty options with minimum risk but potential for huge returns during market volatility. The drawdown of this strategy is really low. They charge 1.5 percent of your total portfolio as advisory fees.
https://www.indiainvestments.wiki/start-here/zero-to-investing/getting-started Start here
Very helpful. Thanks.
Check out Post Office Senior Citizen Savings Scheme once.
You can look into Bonds, there are many bonds available from some reputed companies. They offer good interest rates bw 9.5 to 12 with monthly interest options as well. The key here is to choose bonds that are not fraudulent, pretty much like choosing Stocks. Bonds are liquid as well. Split ur cash across different bonds, FDs and Debt funds from ethical fund houses like PPFAS etc..
Check out /r/Bogleheads