Milestone Achieved: 31M - 1 Cr Net Worth!

[cantplayalick]

@amazing_henry I think it's fairly uncommon. OP surely would have other sources of emergency funds because I think most people maintain (or atleast are advised to maintain) 3 months of salary as funds in bank.

 

[juanna]

@cantplayalick Yes, I do have an Emergency Fund of 12 Lakh with my wife.

 

[highlyblessed]

@amazing_henry It actually is, few people believe in all investing (including me)

 

[stratocaster]

@amazing_henry Anyone who keeps money in the bank is an idiot

 

[xmudpuddle]

@juanna Congrats on achieving the 1 C mark.

Good to see that you figured out your limits and have a clarity on where not to invest.

Some suggestions
1. Go aggressive on pre-paying your home loan. Pay additional emis now to bring down your total repayment interest. Right now your emi is basically interest. Early prepayments will also help reduce your overall tenure.
2. Revisit your MF portfolio, 3 out of 4 funds target large caps. Managed large cap funds have generally not beaten the index.
3. Create a term insurance ladder. By laddering I mean you gradually scale up your cover to 10X your earnings, based on risk and your dependant needs buying in units of 1 or 2 cr per policy so that premiums don't mess up cash flows. To cut your premiums, you can take the cover for a shorter time frame like upto age 70 instead of 85 years in most offers.
Enter your term plans now so that your premiums are lower. Your savings plus insurance should add up to your planned debt free retirement corpus.

The next 5 to 10 years may feel tight due to cash outflows, but things will ease up from then.
Plan for a contingency of buying another home in 5-10 years, you may find your current place small and need for more space. My savings got wiped out when I decided to buy something bigger.

 

[juanna]

@xmudpuddle Thank you for writing such a detailed reply.

1. Wife and I have a plan to close the home loan as soon as possible. We’ll be deploying our bonus in prepaying the Home Loan.
2. I should definitely do that.
3. I’ll definitely look into it.

 

[d_ruiz27]

@juanna For someone starting investment in 2025, what should be the investment strategy to get to 1Cr by 2030 or earlier.

 

[ziggizoggi]

@juanna One question. You have 1 cr corpus currently (in MF, EPF and stocks). How much of this are you breaking for home loan down-payment? Also, if you alone would have to take home loan, how much loan amount would you go for? Additionally, what percentage of monthly salary would you pay in home loan emi? Would you prefer to prepay fast and close loan first or keep it running without breaking your monthly investment cycle?
Apologies if too many questions. I'm in similar situation and planning home loan amount (albeit with not so great investment) and would love to know your thoughts

 

[juanna]

@ziggizoggi

1. I haven’t included any of home loan down or pre-payment in my current net worth.
2. That’s a tricky question. TBH, If I were to be a sole breadwinner for the family I would have delayed purchasing Home by at least 3-4 years.
3. 23% of our combined take home monthly salary.
4. We’re planning to close our home loan early while simultaneously not keeping our investments at hold. We plan to use our bonuses and monthly saving for this purpose. We don’t have any plan ( as of now) to touch our investments.

 

[russellm]

@xmudpuddle Can you recommend any term insurance?