With a financial plan, we feel secure; we know money will be there if we need it

There are enough reports out there showing the higher returns that equity gives in the long run. Dr Collin Roy and his wife Rituparna Roy have gained from this. Their path to seeking better financial products started as it does for many people—wanting to reduce the tax outgo. More than about 10 years ago, to save taxes, most of their investments were in life insurance policies and term deposits. But they wanted better, and they started investing in mutual funds through systematic investment plans (SIPs).

Soon, they moved on to having a complete financial plan, of which tax-saving was only one aspect. At that point, their main goals included investing for their son Suhotro’s education (who was around 12 years old then), to own a house, and have sufficient medical insurance.

Steady hands

The Roys had started investing in mutual funds in 2006-07. In 2008-09, markets crashed. “Many people advised me to take the money out and invest elsewhere. But I stayed invested and that has paid off. So I have persisted with this mode of investment,” said Collin.

Over the years, the couple has been able to tick off their major goals. “We were able to pay for our son’s course comfortably. We didn’t have to take a loan,” said Collin. They had bought an apartment in 2005 using a home loan. “While the loan was of 20 years, I was able to remove this liability in 10 years by pre-paying lump sums,” said Collin.

All of this started with setting goals and then investing towards them. “Financial advisers are experts. We had savings earlier also, but they were haphazard. I had even tried to listen to some friends’ advice, but I thought someone else would be better,” said Collin. “We were advised to try and save 35-40% of our monthly income,” said Rituparna. About 25% of this amount was directed towards mutual funds, and the rest towards insurance premiums. This meant a few adjustments in ‘wants’ so that ‘needs’ could be met. “We wanted to take domestic and international tours. We also wanted to get the interiors of the house done. Some such goals were postponed,” said Rituparna, who herself also made a major decision to change her investments from government schemes to mutual funds. “I had investments in government bonds and monthly plans but returns were not satisfactory. Interest rates are in general going down. Those investments were of my parents,” she said.

Rituparna uses the money to maintain a flat that her parents had bought. “My parents had a flat, and I don’t want to sell it. They had bought it and faced a lot of hardship. That time, loans were not so easily available. They made that house with a lot of hard work, so I don’t want to sell it. I am sentimentally attached to it. I want to maintain it,” she said.

Along with meeting these goals, a contingency fund was also created, most of which is in liquid funds.

Collin also wanted to buy a car, and a plan has been made for that. “I have made a provision so that I can replace (the car) every 6 years,” he said.

Retirement planning

Collin is likely to retire in October 2018, and the couple is well prepared for this stage of their life as they have been planning for it. “Mine is a pensionable job, so I knew that I will have this,” he said. “Planning for post-retirement is very important since our need for financial support increases, and there are medical expenses,” said Rituparna.

Thanks to having been prudent and planning for their main goals, the Roys are in a comfortable spot now. “We feel secure. We know that if we need money, it will be there,” said Rituparna.




Name: Dr Collin Roy

Age: 64

Profession: Doctor

Name: Rituparna Roy

Age: 56

Profession: Homemaker

City: Kolkata

Financial planner: Uttam Kumar Sen, certified financial planner, and blogger at moneyplanner.co.inlivemint

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