Where to invest excess 40 k every month?

Others 528 views 3 replies

Patrick

Private Company Employee

30 Points Posted on 22 August 2016

I am left with excess 40k every month after deducting my expense and investment (self expense, 2k monthly in PPF, 6k MF SIP, 10k in RD and 20k to parents) from salary. How/Where should I invest these 40k effectively ?

Age - 25
Work location - Hyderabad
Hometown - Vadodara

Long term goals: want to buy 2BHK house for living (either in Pune/Hyderabad/Bangalore) in 10 years

I am planning to invest 10k in MF (Mirae Asset Emerging Blue Chip Fund) and remaning 30k in home loan EMI.
Till now its not decided where I am going to settle, so I will buy a 2BHK flat in Vadodara which will cost me between 17 to 20 lacs. When my settle place will get decided (in next 10 years) I will buy new flat for living by withdrawing 10k MF SIP money and by selling that 2BHK flat in Vadodara.

Please share your views on my plan, any new ideas is also appreciable.

Replies (3)

CA VISHAL GUPTA

none

225 Points Posted on 23 August 2016

invest the whole amount of the excess 40000 into SIP choose a mid cap crisil/icra top rated MF and wait for 10 yrs taking an emi now would not be advisable as it would eat up all your savings I would further suggest to reduce RD to 2000 pm and do away with ppf if the employer is already deducting pf/esi and make it 50K a month you are young you could cut your cost thus able to achieve your goal comfortably

Patrick

Private Company Employee

30 Points Posted on 23 August 2016

Aim of PPF investment is to have safe future/retirement investment in response to unsafe 6k MF/ELSS SIP for retirement investment.
RD investment of 10k is to fullfill recent goals like TV, fridge, laptop etc. (will replace RD with debt mf once it gets matured)

Idea of taking home loan is to save some tax under 2.5 lacs bracket. I am not able to exactly compare:
a) 40k in MF
b) 30k home loan EMI + 10k MF + some tax saving due to home loan interest (or 20k home loan EMI plus 20k in MF)

CA.Vinita Gupta

Deputy Manager- Finance

2923 Points Posted on 24 August 2016

If you have enough money to pay for the downpayment of a house, then go make a DP and take the balance amount as Loan and pay Principal and Interest on Home Loan. The real estate market is very bad right now, so you will be able to Negotatie better. Take the House in the Present Location and avoid Rent payment.