2. CM
RISHI B. KHANNA, CFP
Jasbir Singh (27 Years) and Gurpreet Kaur (23 Entertainment Exp. – Rs. 30,000 (Rs.2,500 Health Insurance:
Years) are newly married couple. Jasbir works p.m.),
in an MNC as a Sales Manager. His income is Life Insurance Premium – Rs. 24,500 (Rs.2,042 Jasbir : Nil
Fixed and Incentive based. He is working from p.m), Gurpreet : Nil
last 3 Years in the same company and looking SIP in Equity Fund – Rs.24,000 (Rs.2,000 per
for a good promotion this year. Gurpreet have month). Financial Goals:
left the job after marriage and now looking Total Expenses : Rs. 3,66,500.
after house works. (1) To buy a House after 2 – 3 years.
They both are currently staying on a rented Net Total Surplus : Rs. 3,18,500 Current cost of the Dream house is Rs.
flat, but sooner want to own one in the same Net Monthly Surplus : Rs. 26,540. 40 Lakhs.
area.
(2) Every year vacation in India. Cost Rs.
Annual Cash Flow: Investments : 50,000.
Income: Jasbir: (3) Start creating Retirement Fund to cover
Bank Fixed Deposit – Rs. 45,000 at different the monthly Household Expenses.
Jasbir :- rates. Couple are thinking of increasing the family
Fixed – Rs. 4,25,000, (Rs. 35,416 per month). Cash in Bank – Rs. 38,000. after 2 years.
Incentives – Rs. 2,60,000 (Rs. 21,666 per
month). Gurpreet: (Investments made prior to Assumptions :
(This incentives was earned last year and it is marriage). Genereal Inflation @ 7% ,
assumed that he will earn the minimum same Bank Fixed Deposit – Rs. 75,000 at different Inflation for Dream House @ 10% ,
amount this year also ). rates. Returns in Equity Mutual Fund @ 14% ,
Total Income : Rs. 6,85,000 Cash in Bank – Rs. 52,000. Returns in Liquid Fund @ 7% ,
Returns in Debt Funds and Bank F.D. @
Expenses: Life Insurance: 8% ,
Jasbir: Annual Increase in Salary @ 5% .
Household – Rs.1,44,000 (Rs.12,000 per Sum Assured – Rs. 5,00,000. Incentive amount to be remain the
month), Annual Premium – Rs. 24,500. same.
House Rent – Rs.1,44,000 (Rs.12,000 per (premium is paid on monthly basis).
month),
Gurpreet : Nil
FINANCIAL PLANNING INSURANCE INVESTMENTS
3. CM
RISHI B. KHANNA, CFP
Recommendation: Recommended Cash Flow : To buy the dream house Jasbir will have to go
for a loan. But this surplus money will help him
(1) Contingency / Emergency Fund: Income : to take the loan amount lesser or pay the down
Fixed : Rs. 4,25,000 payment while buying.
Maintain total of Cash Balance Rs. 35,000 in Incentives : Rs. 2,60,000
Savings A/C. and renew the Fixed Deposits at (6) Retirement :
due dates. This will create a contingency fund Total Income: Rs. 6,85,000.
of around Since currently Jasbir’s major goal is to buy a
Rs. 1,55,000 for any emergency. Outflow: dream house after 2 – 3 years, so he is
currently not advised to plan for retirement.
(2) Life Insurance: Household Exp. : Rs. 1,44,000 SIP in Equity Fund is linked with this goal. In
House Rent : Rs. 1,44,000 detail it can be worked out later in coming
Jasbir is recently got married and is away from Entertainment Exp. : Rs. 30,000 years.
any other liability. So currently he is not Life Insurance Premium : Rs. 24,500
advised for any other Insurance cover. He is Mediclaim Premium : Rs. 9,000
asked to continue the previous policy as it is. SIP in Equity Fund : Rs. 24,000 The recommendations made are based on the
SIP in Liquid Fund : Rs. 48,000 data given by the client to the planner.
(3) Health Insurance : Total Outflow : 4,23,500 The detailed plan has been mailed to Jasbir and
with his kind permission I am sharing this plan
A Health Insurance or Mediclaim is advised to Net Total Surplus : Rs. 2,61,500 with my readers.
be taken immediately. They are recommended Net Monthly Surplus : Rs. 21,790.
to go for a Family Floater Policy of Rs. 5 Lakh
for which the annual premium will be close to This Surplus can be used for the below
Rs. 9,000 per annum. mentioned Goal.
(5) Buying a Dream House :
(4) Vacation :
This goal was purposely not taken earlier.
Couple want to go out for enjoyment every The amount which is left surplus in hand
year and so Jasbir is advised to save Rs. 4,000 (Rs. 2,61,500 per annum) have to be invested
per month in a Liquid fund. on monthly basis in Debt Mutual Fund and/or
Bank Deposits.
FINANCIAL PLANNING INSURANCE INVESTMENTS
