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Example of a Wealth Management Plan

This was prepared by me for a class project!

Basic Details:
Name: S S Naik
Profession: Engineer (Non Finance)
Age: 47 Years
Monthly Income: Rs 1,00,000 + 10% increment per year
Age of Retirement: 60 yrs Life Expectancy: 15yrs after retirement
Family: Housewife, Son-20yrs, Daughter- 18Years
Health Related Information (of the head of the family):

  • Used to Smoke
  • Casual Drinking
  • Non Vegetarian
  • Daily Walking
  • High Blood Pressure
  • Cholesterol problem

Salary: Rs 1,00,000 p.a + 10% increase p.a
Monthly Expense: 50k
Goals:

  • Son’s Education in next 1 Year (Rs10 Lakhs fees) (2020)
  • Daughter’s Education in next 4 years (Rs 12 lakhs) (2023)
  • To buy a new car Sedan in next 3 years (Rs 8 lakhs) (2022)
  • Europe Tour within next 5 years (total 7 Lakhs budget) with wife (2024)
  • Son’s Wedding in Next 7 Years (Rs 5 Lakh) (2026)
  • Daughter’s Wedding in next 8 years (Rs 5 Lakh) (2027)
  • Rs 50,000/month after retirement (2032)
  • Sea Face View house in Goa (2032)
    Risk Appetite: Moderate

The Plan:

2020: 48 Yrs

  • Take Mediclaim
    Bajaj Allianze Family Floater Health Guard Gold Plan for Husband Wife |Prem: Rs 39018 for Rs 30Lakh
    For Son and Daughter | Rs 11553 for Rs 10Lakh (Both Covered under 1 plan)
    Total: Rs 50571
  • Break 1st FD of Rs 10,00,000 for Son’s Education
  • Add 4 lakh to existing Mutual Funds ( HDFC Hybrid Debt Fund – Direct Plan – Growth)
  • Remove investment from Axis Mutual Fund and transfer entire amount + 2 Lakhs to SBI Mutual Fund
    (SBI Focused Equity Fund – Regular Plan – Growth)
  • Transfer remaining to Savings bank account Rs 39,429


    2021: 49 Yrs
  • Take Mediclaim
    Bajaj Allianze Family Floater Health Guard Gold Plan for Husband Wife |Prem: Rs 39018 for Rs 30Lakh
    For Son and Daughter | Rs 11553 for Rs 10Lakh (Both Covered under 1 plan)
    Total: Rs 50571
  • Renew FD of Rs 10Lakhs for 4 yrs 2032 ….(i)
  • Add 5 lakh to HDFC HYBRID Debt Fund
  • Transfer Rs 2,39,929 to Bank Account


    2022: 50 Yrs
  • Take Mediclaim
    Bajaj Allianze Family Floater Health Guard Gold Plan for Husband Wife |Prem: Rs 39018 for Rs 30Lakh
    For Son and Daughter | Rs 11553 for Rs 10Lakh (Both Covered under 1 plan)
    Total: Rs 50571
  • Renew FD of 10 Lakhs for upto 2032 …(ii)
  • Remove 3 Lakhs from Savings bank account and use 5 Lakhs from income to buy Sedan worth 8 lakhs
    -Transfer Remaining Rs 3,52,057 to savings bank


    2023: 51 Yrs
  • Take Mediclaim
    Bajaj Allianze Family Floater Health Guard Gold Plan for Husband Wife |Prem: Rs 39018 for Rs 30Lakh
    For Son and Daughter | Rs 11553 for Rs 10Lakh (Both Covered under 1 plan)
    Total: Rs 50571
  • Renew FD of 10 Lakhs for upto 2032 …(iii)
  • Make another FD of 10 Lakhs for upto 2032 …(iv)
  • Transfer Rs 27,620 to Savings bank account


    2024: 52 Yrs
  • Take Mediclaim
    Bajaj Allianze Family Floater Health Guard Gold Plan for Husband Wife |Prem: Rs 39018 for Rs 30Lakh
    For Son and Daughter | Rs 11553 for Rs 10Lakh (Both Covered under 1 plan)
    Total: Rs 50571
  • Renew FD of Rs 10 Lakhs for 4 yrs upto 2032 …(v)
  • Europe Tour with Budget Rs 8 Lakhs
  • Tata Aig Travel Insurance of Rs 5000
  • Invest Rs 3,00,000 in SBI Focused Equity Funds


    2025: 53 Yrs
  • Take Mediclaim
    Bajaj Allianze Family Floater Health Guard Gold Plan for Husband Wife |Prem: Rs 39018 for Rs 30Lakh
    For Son and Daughter | Rs 11553 for Rs 10Lakh (Both Covered under 1 plan)
    Total: Rs 50571
  • Invest 10 lakhs in DSP Equity Fund – Regular Plan – Growth mutual fund
  • Transfer Remaining to Savings Account Rs Rs 2,71,254


    2026: 54 Yrs
  • Take Mediclaim
    Bajaj Allianze Family Floater Health Guard Gold Plan for Husband Wife |Prem: Rs 39018 for
    Rs 30Lakh
    For Son and Daughter | Rs 11553 for Rs 10Lakh (Both Covered under 1 plan)
    Total: Rs 50571
  • Son’s Wedding Expense Rs 10 Lakh
  • Invest Rs 1 Lakh in HDFC Mutual Fund
  • Transfer Rs 3,43,629 to savings account


    2027: 55 Yrs
  • Take Mediclaim
    Bajaj Allianze Family Floater Health Guard Gold Plan for Husband Wife |Prem: Rs 39018 for
    Rs 30Lakh
    For Son and Daughter | Rs 11553 for Rs 10Lakh (Both Covered under 1 plan)
    Total: Rs 50571
  • Withdraw Rs 5 lakh from Savings account and buy gold for daughter
  • Daughter’s Wedding Expense Rs 10 Lakh
  • Invest Rs 5 Lakh in DSP Equity Fund
  • Transfer to bank account Rs 1,85,842


    2028: 56 Yrs
  • Take Mediclaim
    Bajaj Allianze Family Floater Health Guard Gold Plan for Husband Wife |Prem: Rs 39018 for
    Rs 30Lakh
    For Son and Daughter | Rs 11553 for Rs 10Lakh (Both Covered under 1 plan)
    Total: Rs 50571
  • Invest Rs 15 Lakhs in Tata Mid Cap Growth Fund – Regular Plan – Growth mutual fund
  • Buy Gold worth 3 Lakhs
  • Transfer Rs 48,174 to bank savings


    2029: 57 Yrs
  • Bajaj Allianze Family Floater Health Guard Gold Plan for Husband Wife | Prem: Rs83475 for
    Rs 50 lakh insurance (Both covered under one plan)
  • Sell 1 acre land in Goa for 1 cr
  • Sell Equity Shares worth 50 Lakh
  • Buy 1 Sea Face View Bungalow worth Rs 1.5 Cr
  • Invest Rs 15 Lakhs in SBI Dynamic Bond Fund – Growth
  • Transfer Rs 5,51,687 to savings bank account


    2030: 58 Yrs
  • Bajaj Allianze Family Floater Health Guard Gold Plan for Husband Wife | Prem: Rs83475 for
    Rs 50 lakh insurance (Both covered under one plan)
  • Invest Rs 15Lakh in IDFC Bond Fund – Medium Term Plan mutual fund
  • Transfer Rs 8,14,073 to savings bank account


    2031: 59 Yrs
  • Bajaj Allianze Family Floater Health Guard Gold Plan for Husband Wife | Prem: Rs83475 for
    Rs 50 lakh insurance (Both covered under one plan)
  • Add Rs 5 Lakhs to HDFC, SBI Equity focused and DSP mutual fund
  • Transfer Rs 11,05,135 to bank account


    2032: 60 Yrs
  • Bajaj Allianze Family Floater Health Guard Gold Plan for Husband Wife | Prem: Rs83475 for
    Rs 50 lakh insurance (Both covered under one plan)
  • Buy Religare Critical Health Insurance for self and wife | Prem: Rs 43925 for Rs 1 Cr
    Insurance (Both covered under one plan)
  • Receive FD worth Rs 50Lakh amount and open 3 more mutual funds of 15 Lakhs each:
    Canara Robeco Conservative Hybrid Fund – Regular Plan – Growth
    Kotak Equity Arbitrage Fund – Growth
    IDFC Corporate Bond Fund – Regular Plan – Growth
  • Buy Gold worth 5 Lakhs of remaining FD amount
  • Transfer remaining amount of Rs 28,73,941 to bank balance
  • Open new account in HDFC Bank and divide the bank balance in HDFC and ICICI Bank
    equally for safety of funds.

Mutual Funds:
HDFC Hybrid Debt Fund – Direct Plan – Growth 20 lakh
SBI Focused Equity Fund – Regular Plan – Growth 20 Lakhs
DSP Equity Fund – Regular Plan – Growth 20 Lakhs
Tata Mid Cap Growth Fund – Regular Plan – Growth 15 Lakhs
SBI Dynamic Bond Fund – Growth 15 Lakhs
IDFC Bond Fund – Medium Term Plan – Regular Plan – Growth Rs 15Lakhs
Canara Robeco Conservative Hybrid Fund – Regular Plan – Growth 15 Lakhs
Kotak Equity Arbitrage Fund – Growth 15 Lakhs
IDFC Corporate Bond Fund – Regular Plan – Growth 15 Lakhs
Bank:
HDFC Bank: Rs 28,68,677
ICICI Bank: Rs 28,68,677


After retirement:

  1. Life is expected till 75yrs
    therefore,
    Mediclaim = 83475 * 15 = Rs 12,52,125
    Critical Health Insurance = 43925 * 15 = Rs 6,58,875
    All the health related expenses to be taken from Savings Bank account
  2. SS Naik should withdraw Rs 50,000 from his mutual funds every month (withdrawing his entire mutual funds
    investment through SWP – Systematic Withdrawal Plan) till his expected age of life, i.e,
    Monthly Withdrawal: 50,000 x 12 x 15 = Rs 90,00,000
    Excess Funds can be utilized by SS Naik and his family for unseen negative circumstances.
    Interest Rates have been not calculated on the investments.


    Thank You for Reading

5 Comments »

  1. Thank you for sharing your personal insights! Not many bloggers are able to do it nowadays.
    I also loved how well you are able to express your opinions- so clear and effective.
    I wouldn’t wanna miss your future articles so I have decided to follow your blog. 🙂

    Liked by 1 person

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