Plan for a newly retired person

Mahendra (56) is retired and lives in his own house with his wife (46) and two daughters. His wife is a homemaker. Before he retired, Mahendra was employed in the Middle East as a chartered accountant. He has accumulated a corpus of Rs 2.30 crore and has also invested in a piece of land, whose current worth is Rs 35 lakh. His financial goals are his daughters' weddings and a comfortable post-retirement life. Here is a financial plan for him. Emergency fund A good financial plan starts with provisioning for emergencies. The emergency corpus should be equal to six months' expenses. Mahendra's monthly expenditure is about Rs 85,000. Hence, he should maintain an emergency corpus of Rs 5.10 lakh. It should be maintained in a combination of a sweep-in fixed deposit and short-term debt funds. This will ensure both liquidity and decent returns. He can find good quality short-term debt funds on the Value Research website. Action: Maintain an emergency corpus of Rs 5.10 lakh. Life insurance Although Mahendra has dependents, he doesn't need a life cover as he has accumulated sufficient corpus to take care of his dependents in his absence. So he is rig

This article was originally published on December 12, 2019, and last updated on October 26, 2022.