financial plan

FINANCIAL PLAN Mr. Sameer Soopari

PREPARED BY:

RIKHIL PATEL

1011517080

PGDM 2015-17

SUBMITTED TO:

Prof. RINKI ROLA

Assistant Professor (Finance)

Page | 1

ACKNOWLEDGEMENT

With regard to my Project, I would like to thank each and every one who offered help, guideline

and support whenever required.

First and foremost, I would like to express my deepest gratitude to my mentor Prof. RINKI

ROLA, for her valuable time and advice in the making of this project. Without his support and

guidance, the completion of this project would not have been possible.

Finally, I thank my institute, Shanti Business School, for providing me a platform to work on

a particular assignment. I also want to thank my batch mates who have helped me in getting

acquainted with various aspects during the project

Page | 2

TABLE OF CONTENTS

S.R

NO.

TITLE PAGE

NO.

1 Scope of Financial Planning 3

2 Assumptions 4

3 Personal Details 5

4 Financial Goals 6

5 Income-Expense Analysis 7

6 Net Worth 9

7 Risk Profile 10

8 Asset Allocation 11

9 Goal Analysis 12

10 Insurance Planning 16

11 Recommended Pre-Retirement Cash Flow 19

12 Recommended ROI 23

13 Tax Planning Scheme 25

14 Employees Provident Fund 26

15 Retirement Planning 28

16 Post Retirement Returns 29

17 Estate Planning 30

Page | 3

SCOPE OF FINANCIAL PLANNING

The Financial Plan identifies your present financial condition and what you want to achieve in

future. Based on the information we have obtained during our meeting; a comprehensive

financial plan has been developed for you which will provide you a guidance on your financial

objectives.

The scope of your financial plan is as follows:

Your Income-Expense Analysis: This analyses your current income & expenses and

current investment & savings.

Goal Analysis: Identifies & analyses the requirement for your various financial goals

including your children goals.

Retirement Planning: Analyses your post-retirement needs and a suitable solution

which addresses those needs.

Insurance Planning: Identifies your insurance requirements against possible risks.

Cash Flow gives you an understanding of your future cash inflow & outflow at various

stages in your life.

Taking every aspect into consideration, this report will give you an insight into your financial

goals and a suitable action plan for them.

Page | 4

ASSUMPTIONS

While creating your financial plan, we have based our calculations on certain assumptions:

The financial plan & the various requirements are based on your present financial

conditions.

Regarding long-term pre-tax returns on various asset classes:

Equity & Equity MF schemes /Index ETFs: 11.00% p.a.

Balanced MF schemes - 9.00% p.a.

Bonds/Govt. Securities/Debt MF schemes: 7.00% p.a.

Liquid MF schemes - 5.50% p.a.

Gold & Gold ETF - 5.50% p.a.

ELSS Return- 9.00%

SBI Education loan: 11.1%

Regarding economic factors (long-term view):

1. Inflation - 5.50% p.a.

2. Risk free rate - 6.50% p.a.

3. Real Estate appreciation - 6.00% p.a.

You and your Spouse have planned to retire at your respective age of 60 years.

Your salary is likely to grow at 7.5% p.a. and your spouse salary is likely to grow at

7.5% p.a.

The life expectancy of you and your wife has been taken at your respective age of 80

years.

Page | 5

PERSONAL DETAILS

Based on the inputs given in the case, following are the personal details.

Client’s Name: Sameer Soopari

Age: 30 Years

Occupation: Work for a prominent private sector airline.

FAMILY DETAILS

Name Relationship Age Occupation

Urvi Soopari Wife 31 Salaried

Page | 6

YOUR FINANCIAL GOALS

The first step in creating a financial plan is to identify financial goals. Here I mentioned below

the financial goals of Mr Sameer Soopari and Mrs Urvi Soopari.

Goals Target Date or Time Horizon

Current Total Cost

Inflation Rate

Future Value Priority level

Buy a car 0 350000 350000 1

Go for abroad trip 1 200000 5.50% ₹ 2,11,000 2










Child's Graduation 20 800000 5.50% ₹ 23,34,206 4

Child's Post Graduation 23 3500000 5.50% ₹ 1,19,91,530 5

Child's marriage 25 800000 5.50% ₹ 30,50,714 6

Holiday home in Ratnagiri 15 3000000 5.50% ₹ 66,97,429 7

Identifying and prioritizing your goals and the associated costs is the first step in your journey

towards a financially secure future.

Inflation is an important thing to understand here. The cost of goods & services, or in short

inflation, has been on an uptrend over the last few years. Inflation decreases the purchasing

power of money. So you will need more amount of money for your goals at a time of their

realization.

Buying a car is kept in the first priority for an individual followed by abroad trip, child’s

graduation, post-graduation, marriage, home in Ratnagiri.

Page | 7

Income – Expense Analysis

Income

The client has single source of earning his entire income i.e., from his Job. Monthly income

segregation is given in the following table.

Sources of Income Amount (in Rs)

Monthly Yearly

Salary of Self 50500 606000

Spouse Income 50500 606000

Total 101000 1212000

.

Expenses

Expense Type Amount (in Rs)

Monthly Yearly

EMI on House 18473 221676

Insurance Premium 115600

Home Expenses 5050 60600

Conveyance 1000 12000

Communication 3700 44400

Utilities 3970 47640

Others 14833 178000

Repair & Maintenance 1167 6500

Total 48193 686416

606000, 50%606000, 50%

Sources ofIncome

Salary of Self

Spouse Income

Page | 8

The below chart will help in understanding about the breakup of the expenses. This will also

guide in cutting down certain expenses, to increase your surplus, if the same is not sufficient

to meet all goals.

Savings

Base on your income and expense details, you are saving around 43% of your income.

Note: The savings ratio is greater than 30 % so it is good and financial performance of

Mr.Sameer Soopari in last financial year 2015-16 is good

32%

17%9%

2%6%

7%

26%

1%

Expenses Break-up

EMI on House

Insurance Premium

Home Expenses

Conveyance

Communication

Utilities

Others

Repair & Maintenance

0

200000

400000

600000

800000

1000000

1200000

1400000

Annual Income Annual Expense Savings

Savings Chart

Page | 9

NET WORTH

Net Worth shows your financial condition as on a specific date. This will help you to monitor

your progress as you build your assets.

Liabilities Amount in Rs. Assets Amount in Rs.

Capital Accounts Physical Assets:

Surplus 525584 House Property

Sameer 5000000

Long-Term Liabilities Urvi 5000000

House Loan 5000000

Current Liabilities Financial Assets

Insurance Premium 115600 Cash in hand

insurance Premium for bike 775 Sameer 100000

Urvi 250000

Fixed deposits 58161

PF account balance

Sameer 151000

Urvi 151000

Total Liabilities 5641959 Total Assets 10710161

Net Worth 5068202

Total 10710161 Total 10710161

10710161

5641959

NET WORTH

Total Assets Total Liabilities

Page | 10

YOUR RISK PROFILE

Based on your response to the risk analyser questionnaire, you are a Moderately

Conservative investor.

As a Moderately Conservative investor

1. Your primary goal is medium to long term capital.

2. You are comfortable with low to moderate short term fluctuations in the value of your

investments to generate high returns.

3. Your investment mix is likely to include an equal mix of the defensive assets and growth

assets such as equities and property.

Page | 11

ASSETS ALLOCATION

One of the most important stages in analysing your investments is to understand your asset

allocation. Asset allocation represents the mix of stocks, bonds & cash that you own. It is

important to have a right asset mix in order to enhance your return potential and provide you

the right diversification to benefit from the various investment opportunities.

302000, 43%408161, 57%

Assets Allocation Amount (Rs.)

Debt

Cash in hand

Page | 12

GOALS- SUGGESTIONS & ANALYSIS

1. Buy a car

Time Period Amount Source

3 Months 350000 1st year Surplus

As Sameer has to buy a car within 3 months, it can be purchased through the surplus as it is

an immediate goal.

2. Go for Abroad Trip

Goals Target Date

or Time Horizon

Current Total Cost

Inflation Rate

Future Value

Go for abroad trip 1 200000 5.50% ₹ 2,11,000










The client has many goals to fulfil, so abroad trip for first year and then once in every three

years will lack his funds for achieving his priority goals. So he is not able to go abroad in the

first 5 years after that he can go abroad as per the plan. Following is the table showing details

of his vacation trip:

Years Amount Source

4 2,47,765 4th Year Net Investible Surplus After Inv.




Page | 13



22 6,49,507 22nd Year Net Investible Surplus After Inv.



Note: The details of the investments made to pay the above amount is given further in the Cash

Flow and the Recommended Return on Investments.

3. Child’s Graduation

Goal Name Present Cost Yrs. To Goal Future Cost

Child's Graduation 800000 20 23,34,205

The following table shows the segregation of payments of goal in upcoming years:

Investment PV of Invest. Interest Rate FV

MF Bond 76000 7% ₹

23,43,857

While investing for child’s graduation, a client cannot take chance by taking too much risk by

investing on equity. In the given case, child’s graduation is his main priority, so an investment

in MF bond will secure his fund as compare to equity and it will give the fair return of around

7%. The amount is invested for 17 years and the requirement of cash will be met on time.

Note: The details of the investments made to pay the above amount is given further in the

Cash Flow and the Recommended Return on Investments.

4. Child’s Post-graduation


Child's Post Graduation 3500000 23 1,19,91,530

Page | 14



MF Bond 293000 7% ₹

1,20,11,679

In the given case, child’s post-graduation is his second priority, so an investment in MF bond

will secure his fund as compare to equity and it will give the fair return of around 7%. The

amount is invested for 20 years and the requirement of cash will be met on time.



5. Child’s Marriage


Child's Marriage 800000 25 30,50,714



MF Bond 57100 7% ₹ 30,51,204

Same is in the case of his child’s marriage fund, the risk factor should not be maximum so

investment in MF bond will give fair return. The amount is invested for 19 years and the

requirement of cash will be met on time.



6. Holiday Home in Ratnagiri


Holiday Home in Ratnagiri 3000000 15 66,97,429

Page | 15



Equity MF 150000 11% ₹ 4,25,913

300000 ₹ 7,67,411

300000 ₹ 6,91,361

500000 ₹ 10,38,080

400000 ₹ 7,48,166

500000 ₹ 8,42,529

500000 ₹ 7,59,035

500000 ₹ 6,83,816

500000 ₹ 6,16,050

100000 ₹ 1,11,000

₹ 66,83,361.24

To meet this goal investment has been made in Equity MF as the home is required to spent

their time after retirement so the fund is required for long period. Therefore, client can invest

in Equity MF.

Page | 16

INSURANCE PLANNING

1. Whole Life Insurance:

Being adequately insured is essential to help your family lead an independent life style in the

event something unfortunate was to happen to you. The client and his wife, both don’t have

any life insurance to secure their life. So, a life insurance should be done for both of them.

Following are the calculations of sum assured of both husband and wife:

Life Insurance of Sameer

Year Income Expenses Surplus PV

0 606000 86820 519180 ₹ 5,19,180

1 651450 91594 559856 ₹ 5,30,669

2 700309 193266 507043 ₹ 4,55,554

3 752832 203895 548937 ₹ 4,67,482

4 809294 107537 701757 ₹ 5,66,470

5 869991 113442 756549 ₹ 5,78,862

6 935241 119670 815571 ₹ 5,91,489

7 1005384 126237 879146 ₹ 6,04,358

8 1080788 133164 947624 ₹ 6,17,471

9 1161847 140468 1021378 ₹ 6,30,833

10 1248985 148172 1100813 ₹ 6,44,449

11 1342659 156297 1186362 ₹ 6,58,325

12 1443358 164866 1278492 ₹ 6,72,463

13 1551610 173904 1377707 ₹ 6,86,870

14 1667981 183435 1484546 ₹ 7,01,551

15 1793080 193487 1599592 ₹ 7,16,510

16 1927561 204090 1723471 ₹ 7,31,753

17 2072128 215272 1856856 ₹ 7,47,285

18 2227537 227065 2000472 ₹ 7,63,112

19 2394603 239504 2155099 ₹ 7,79,239

20 2574198 252622 2321575 ₹ 7,95,671

21 2767263 266459 2500804 ₹ 8,12,415

22 2974807 281052 2693755 ₹ 8,29,476

23 3197918 296444 2901474 ₹ 8,46,861

24 3437762 312678 3125084 ₹ 8,64,575

25 3695594 329800 3365794 ₹ 8,82,625

26 3972763 347859 3624904 ₹ 9,01,016

27 4270721 366906 3903814 ₹ 9,19,756

28 4591025 386996 4204029 ₹ 9,38,851

29 4935351 408185 4527167 ₹ 9,58,308

30 5305503 430534 4874969 ₹ 9,78,133

Net Value ₹ 2,23,91,614

Page | 17

Life Insurance of Urvi

Year Income Expenses Surplus PV

0 606000 86820 519180 519180

1 651450 91594 559856 530669

2 0 0

3 0 0

4 651450 107537 543913 439055

5 700309 113442 586866 449032

6 752832 119670 633162 459198

7 809294 126237 683057 469558

8 869991 133164 736828 480116

9 935241 140468 794772 490875

10 1005384 148172 857211 501838

11 1080788 156297 924490 513009

12 1161847 164866 996980 524393

13 1248985 173904 1075082 535993

14 1342659 183435 1159224 547814

15 1443358 193487 1249871 559859

16 1551610 204090 1347521 572132

17 1667981 215272 1452710 584638

18 1793080 227065 1566015 597381

19 1927561 239504 1688057 610366

20 2072128 252622 1819505 623597

21 2227537 266459 1961078 637079

22 2394603 281052 2113550 650816

23 2574198 296444 2277754 664814

24 2767263 312678 2454585 679077

25 2974807 329800 2645007 693610

26 3197918 347859 2850059 708418

27 3437762 366906 3070855 723507

28 3695594 386996 3308598 738882

29 3972763 408185 3564578 754548

30 4270721 430534 3840187 770511

Net Value 1,70,29,967

The above calculations are done by assessing the present value of surplus of both husband and

wife. Because both of them are working personnel, the total expenses are divided among them

equally. The expenses consist of only the house hold expenses and not the personal expenses.

Now the question is whether they have to do the life insurance according to the calculations or

they can go with some lump sum amount of sum assured. So, I suggest that an insurance of

sum assured of Rs.5000000 for both Sameer and Urvi is sufficient. The following are the details

of the Whole Life Insurance:

Page | 18

Name Product Name Term

Sum

Assured Premium

Sameer LIC Amulya jeevan-II 25 5000000 16188

Urvi LIC Amulya jeevan-II 25 5000000 16188

2. Medi-claim Insurance

Medi-claim Insurance is a hospitalisation benefit policy offered by both Public & Private sector

general insurance companies. The policy takes care of medical expenses following

Hospitalisation/Domiciliary Hospitalisation of the insured in respect of the following

situations:

In case of sudden illness

In case of an accident

In case of any surgery which is required in respect of any disease which has arisen during the

policy period.

I recommend them to take Star Comprehensive Insurance Policy for both Sameer and Urvi.

The following given are the details of the medical insurance:

Name Product Name Term Policy

Benefit Premium

Sameer Star Comprehensive Ins. Policy 25 1500000 12302

Urvi Star Comprehensive Ins. Policy 25 1500000 12302

RECOMMENDED PRE-RETIREMENT CASHFLOW

Year

No.Yr

Sameer's

Income

(p.a.)

Urvi's

Income

(p.a.)

Bal. of

Year end

Total Income

Generation

(p.a.)

Household

Expenses

(p.a.)

EMIULIP1

(S)

ULDPP

(S)

ULIP2

(S)

ULDPP

(S)

ULIP1

(U)

ULIP2

(U)

ULIP3

(U)

ULIP4

(U)

0 2016 604000 604000 1208000 349140 221676 25000 25000 17133 10000 25000 18635 5000 5000

1 2017 649300 649300 3236 1301836 375326 221676 25000 25000 17133 10000 25000 18635 5000 5000

2 2018 697998 Not Working 455450 1153447 403475 221676 25000 25000 17133 10000 25000 18635 5000 5000

3 2019 750347 Not Working 308725 1059072 433736 221676 25000 25000 17133 10000 25000 18635 5000 5000

4 2020 806623 649300 171045 1626968 466266 221676 25000 25000 17133 10000 25000 18635 5000 5000

5 2021 867120 697998 261172 1826290 501236 221676 25000 25000 17133 10000 25000 18635 5000 5000

6 2022 932154 750347 391529 2074031 538828 221676 25000 25000 17133 10000 25000 18635 5000 5000

7 2023 1002066 806623 669293 2477982 579240 221676 25000 25000 17133 10000 25000 18635 5000 5000

8 2024 1077221 867120 649197 2593538 622683 221676 25000 25000 17133 10000 25000 18635 5000 5000

9 2025 1158012 932154 1047716 3137883 669385 221676 25000 17133 10000 25000 18635 5000 5000

10 2026 1244863 1002066 1456728 3703657 719589 25000 17133 10000 25000 18635 5000 5000

11 2027 1338228 1077221 1725945 4141393 773558 25000 17133 10000 25000 18635 5000 5000

12 2028 1438595 1158012 2797845 5394452 831575 25000 17133 10000 18635 5000 5000

13 2029 1546489 1244863 3918777 6710130 893943 17133 10000 18635 5000 5000

14 2030 1662476 1338228 4717452 7718156 960988 17133 18635 5000 5000

15 2031 1787162 1438595 6093514 9319271 1033062 17133 18635 5000 5000

16 2032 1921199 1546489 7884076 11351764 1110542 17133 18635

17 2033 2065289 1662476 9415947 13143712 1193833 17133 18635

18 2034 2220186 1787162 11812030 15819377 1283370 17133 18635

19 2035 2386700 1921199 15095052 19402951 1379623 17133 18635

20 2036 2565702 2065289 18430816 23061807 1483095 17133 18635

21 2037 2758130 2220186 22948196 27926511 1594327 17133 18635

22 2038 2964989 2386700 28258481 33610170 1713901 17133 18635

23 2039 3187364 2565702 33662222 39415288 1842444 17133 18635

24 2040 3426416 2758130 40618446 46802992 1980627 17133 18635

25 2041 3683397 2964989 48912568 55560954 2129174 17133 18635

26 2042 3959652 3187364 57541129 64688144 2288862 17133 18635

27 2043 4256626 3426416 68241263 75924305 2460527 17133 18635

28 2044 4575873 3683397 80471725 88730995 2645067 17133 18635

29 2045 4919063 3959652 93367424 102246139 2843447 17133 18635

30 2046 5287993 108997185 114285178 3056705 17133 18635

Page | 20

Moneyback

Plan(S)

Cash

Surplus

Cash

Inflow

Contingency

Fund

Net Investible

Surplus

(p.a.)

Buy a

Car

Abroad

Trip

Children's

Graduation

(MF Bond)

Children's

Post Graduation

(Bond MF)

Holiday Home

in Ratnagiri

(Equity MF)

Children's

Marriage

(MF Bond)

Net Investible

Surplus After

Inv. (p.a.)

9832 496584 43643 452942 350000 102942

9832 564234 93831 470403 470403

9832 387696 100869 286828 286828

9832 263061 108434 154627 154627

9832 798427 116566 681860 247765 76000 57100 300995

9832 962778 125309 837469 76000 293000 57100 411369

9832 1172926 100000 134707 1138219 76000 293000 57100 712119

1546298 144810 1401488 290936 76000 293000 57100 684452

1618410 155671 1462739 76000 293000 57100 1036639

2141054 167346 1973708 76000 293000 150000 57100 1397608

2878301 179897 2698403 341629 76000 293000 300000 57100 1630674

3262067 250000 193389 3318678 76000 293000 300000 57100 2592578

4482109 250000 207894 4524216 76000 293000 500000 57100 3598116

5760419 223486 5536934 401155 76000 293000 400000 57100 4309679

6711400 240247 6471152 76000 293000 500000 57100 5545052

8240440 100000 258266 8082175 76000 293000 500000 57100 7156075

10205454 277636 9927819 471053 76000 293000 500000 57100 8530666

11914111 298458 11615653 76000 293000 500000 57100 10689553

14500239 320843 14179397 76000 293000 100000 57100 13653297

17987560 344906 17642654 553129 76000 293000 57100 16663425

21542944 370774 21172171 76000 293000 57100 20746071

26296417 398582 25897835 293000 57100 25547735

31860501 428475 31432026 649507 293000 57100 30432418

37537076 460611 37076465 293000 57100 36726365

44786597 495157 44291440 57100 44234340

53396012 532294 52863719 762678 57100 52043940

62363514 572216 61791298 57100 61734198

73428010 615132 72812878 72812878

86050160 661267 85388893 895569 84493325

99366925 710862 98656063 98656063

111192705 764176 110428528 110428528

Page | 21

NPS

for

Sameer

NPS

for

Urvi

Star compr.

Ins. Policy

(S)

Star compr.

Ins. Policy

(U)

PF

Contribution

(S)

PF

Contribution

(U)

LIC

Insurance

Premium

Contingency

Realese

Net Surplus

After Paying

Premium

Invested

in

Equity

₹ 50,000 ₹ 50,000 ₹ 2,941.50 ₹ 0.00

₹ 50,000 ₹ 50,000 ₹ 43,643 ₹ 4,14,045.28 ₹ 3,235.65

₹ 50,000 ₹ 50,000 ₹ 93,831 ₹ 2,80,659.04 ₹ 4,55,449.80

₹ 50,000 ₹ 50,000 ₹ 1,00,869 ₹ 1,55,495.57 ₹ 3,08,724.94

36000 36000 ₹ 50,000 ₹ 50,000 ₹ 1,08,434 ₹ 2,37,429.32 ₹ 1,71,045.12

36000 36000 ₹ 50,000 ₹ 50,000 ₹ 1,16,566 ₹ 3,55,935.76 ₹ 2,61,172.25

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 1,25,309 ₹ 6,08,448.31 ₹ 3,91,529.33

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 1,34,707 ₹ 5,90,178.90 ₹ 6,69,293.14

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 1,44,810 ₹ 9,52,469.30 ₹ 6,49,196.79

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 1,55,671 ₹ 13,24,298.48 ₹ 10,47,716.23

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 1,67,346 ₹ 15,69,040.66 ₹ 14,56,728.33

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 1,79,897 ₹ 25,43,495.14 ₹ 17,25,944.73

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 1,93,389 ₹ 35,62,524.95 ₹ 27,97,844.66

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 2,07,894 ₹ 42,88,592.58 ₹ 39,18,777.44

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 2,23,486 ₹ 55,39,558.10 ₹ 47,17,451.84

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 2,40,247 ₹ 71,67,341.74 ₹ 60,93,513.91

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 2,58,266 ₹ 85,59,951.89 ₹ 78,84,075.91

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 2,77,636 ₹ 1,07,38,208.83 ₹ 94,15,947.08

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 2,98,458 ₹ 1,37,22,774.70 ₹ 1,18,12,029.71

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 3,20,843 ₹ 1,67,55,287.25 ₹ 1,50,95,052.17

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 3,44,906 ₹ 2,08,61,996.37 ₹ 1,84,30,815.97

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 3,70,774 ₹ 2,56,89,528.53 ₹ 2,29,48,196.01

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 3,98,582 ₹ 3,06,02,020.04 ₹ 2,82,58,481.38

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 4,28,475 ₹ 3,69,25,860.16 ₹ 3,36,62,222.05

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 4,60,611 ₹ 4,44,65,970.76 ₹ 4,06,18,446.18

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 4,95,157 ₹ 5,23,10,116.89 ₹ 4,89,12,567.83

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 5,32,294 ₹ 6,20,37,511.76 ₹ 5,75,41,128.57

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 5,72,216 ₹ 7,31,56,113.46 ₹ 6,82,41,262.94

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 6,15,132 ₹ 8,48,79,476.60 ₹ 8,04,71,724.81

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 6,61,267 ₹ 9,90,88,349.81 ₹ 9,33,67,424.26

36000 36000 12302 12302 ₹ 50,000 ₹ 50,000 ₹ 32,376 ₹ 7,10,862 ₹ 11,09,10,410.05 ₹ 10,89,97,184.79

Surplus ₹ 12,20,01,451.05

less Invested in land ₹ 5,00,00,000.00

less Build a hostel ₹ 5,00,00,000.00

Net Available ₹ 2,20,01,451.05

Notes: -

All the amount shown in the cash flow are just cash inflows and outflows in a particular year.

The incomes earned by both Sameer & Urvi are after deducting TDS from the Basic Salary.

A contingency fund is created every year by taking three months’ expenses as an amount. The

first year’s contingency fund amount is considered as his 1.5 months’ salary. After that The

first year’s contingency fund amount is released for the investment and further year funds are

again accumulated into Net Surplus for further investments.

All the investments and future planning are done according to their net surplus in hand.

In the first four years due to cash deficit as his wife Urvi is not working for two years so source

of income is from only Sameer. So planning of abroad trip is not possible for them.

To convert cash deficit into cash surplus the closing balance of every year is transferred to next

year’s opening balance.

For their retirement planning, NPS A/c for both Sameer and Urvi is opened. EPF A/c is being

carry forwarded by them.

Sameer has taken two Unit Linked Deferred Pension Plan which give interest of 9% and the

surplus amount will be received after retirement. The returns are given below: -

ULDPP Returns

ULDPP(S) Return ULDPP(S) Return

25000 331692 10000 132676.7847

25000 331692 10000 132676.7847

25000 331692 10000 132676.7847

25000 331692 10000 132676.7847

25000 331692 10000 132676.7847

25000 331692 10000 132676.7847

25000 331692 10000 132676.7847

25000 331692 10000 132676.7847

25000 331692 10000 132676.7847

Total 2985228 10000 132676.7847

10000 132676.7847

10000 132676.7847

10000 132676.7847

10000 132676.7847

Total 1857474.986

Page | 23

RECOMMENDED ROI

Year

No.Years

Child's

Graduation

(Bond MF)

Child's Post

Graduation

(Bond MF)

Child's

Marriage

(Bond MF)

0 2016

1 2017

2 2018

3 2019

4 2020 81320 61097

5 2021 81320 313510 65374

6 2022 81320 335456 69950 150000 ₹ 4,25,913.15

7 2023 81320 358938 74846 300000 ₹ 7,67,411.08

8 2024 81320 384063 80086 300000 ₹ 6,91,361.33

9 2025 81320 410948 85692 500000 ₹ 10,38,080.08

10 2026 81320 439714 91690 400000 ₹ 7,48,165.82

11 2027 81320 470494 98108 500000 ₹ 8,42,529.08

12 2028 81320 503429 104976 500000 ₹ 7,59,035.21

13 2029 81320 538669 112324 500000 ₹ 6,83,815.50

14 2030 81320 576375 120187 500000 ₹ 6,16,050.00

15 2031 81320 616722 128600 100000 ₹ 1,11,000.00

16 2032 81320 659892 137602

17 2033 81320 706085 147234

18 2034 81320 755511 157541

19 2035 81320 808396 168569

20 2036 81320 864984 180368

21 2037 925533 192994

22 2038 990320 206504

23 2039 1059643 220959

24 2040 236426

25 2041 252976

26 2042 270684

27 2043

28 2044

29 2045

30 2046

Holiday Home In

Ratnagiri (Equity MF)

Estimated Return on Current Investments (Before Retirement)

Page | 24

Notes:

The amounts shown in the table are the Return on Investments on a particular year.

The amount in Debt Mutual Fund invested by the client are Child’s education fund for 17 years,

Child’s post-graduation for 20 years and for child’s marriage 23 years and get interest of 7%.

So as per needs of funds amount is availed for the plans.

For the holiday home in Ratnagiri client has invested money for ten years so when he required

money the invested amount is availed to complete his goal.

Page | 25

TAX PLANNING SCHEMES

SECTION 80C:

EPF Contribution

Life Insurance Premium

SECTION 80D:

Medi-claim Insurance of both.

SECTION 80CCD (1)

NPS Scheme for both.

Page | 26

EMPLOYEES PROVIDENT FUND

Notes:

o The rate of interest is to be assumed @7.5% p.a.

o Sameer is making contribution of lump sum amount of Rs.50000 every year.

o After retirement of Sameer, he will get the amount of Rs.6879716 from his EPF A/c.

Sr. No. Date Opening Balance Contribution Int. on Cont. Int. on Op. Bal. Closing Balance

1 01-04-2016 151000 50000 3750 11325 216075

2 01-04-2017 216075 50000 3750 16206 286031

3 01-04-2018 286031 50000 3750 21452 361233

4 01-04-2019 361233 50000 3750 27092 442075

5 01-04-2020 442075 50000 3750 33156 528981

6 01-04-2021 528981 50000 3750 39674 622405

7 01-04-2022 622405 50000 3750 46680 722835

8 01-04-2023 722835 50000 3750 54213 830798

9 01-04-2024 830798 50000 3750 62310 946857

10 01-04-2025 946857 50000 3750 71014 1071622

11 01-04-2026 1071622 50000 3750 80372 1205743

12 01-04-2027 1205743 50000 3750 90431 1349924

13 01-04-2028 1349924 50000 3750 101244 1504918

14 01-04-2029 1504918 50000 3750 112869 1671537

15 01-04-2030 1671537 50000 3750 125365 1850653

16 01-04-2031 1850653 50000 3750 138799 2043202

17 01-04-2032 2043202 50000 3750 153240 2250192

18 01-04-2033 2250192 50000 3750 168764 2472706

19 01-04-2034 2472706 50000 3750 185453 2711909

20 01-04-2035 2711909 50000 3750 203393 2969052

21 01-04-2036 2969052 50000 3750 222679 3245481

22 01-04-2037 3245481 50000 3750 243411 3542642

23 01-04-2038 3542642 50000 3750 265698 3862090

24 01-04-2039 3862090 50000 3750 289657 4205497

25 01-04-2040 4205497 50000 3750 315412 4574659

26 01-04-2041 4574659 50000 3750 343099 4971509

27 01-04-2042 4971509 50000 3750 372863 5398122

28 01-04-2043 5398122 50000 3750 404859 5856731

29 01-04-2044 5856731 50000 3750 439255 6349736

30 01-04-2045 6349736 50000 3750 476230 6879716

SAMEER'S PF

Page | 27

Notes:

o The rate of interest is to be assumed @7.5% p.a.

o Urvi is making contribution of lump sum amount of Rs.50000 every year.

o After retirement of Urvi, he will get the amount of Rs.6349736 from his EPF A/c.

Sr. No. Date Opening Balance Contribution Int. on Cont. Int. on Op. Bal. Closing Balance

1 01-04-2016 151000 50000 3750 11325 216075

2 01-04-2017 216075 50000 3750 16206 286031

3 01-04-2018 286031 50000 3750 21452 361233

4 01-04-2019 361233 50000 3750 27092 442075

5 01-04-2020 442075 50000 3750 33156 528981

6 01-04-2021 528981 50000 3750 39674 622405

7 01-04-2022 622405 50000 3750 46680 722835

8 01-04-2023 722835 50000 3750 54213 830798

9 01-04-2024 830798 50000 3750 62310 946857

10 01-04-2025 946857 50000 3750 71014 1071622

11 01-04-2026 1071622 50000 3750 80372 1205743

12 01-04-2027 1205743 50000 3750 90431 1349924

13 01-04-2028 1349924 50000 3750 101244 1504918

14 01-04-2029 1504918 50000 3750 112869 1671537

15 01-04-2030 1671537 50000 3750 125365 1850653

16 01-04-2031 1850653 50000 3750 138799 2043202

17 01-04-2032 2043202 50000 3750 153240 2250192

18 01-04-2033 2250192 50000 3750 168764 2472706

19 01-04-2034 2472706 50000 3750 185453 2711909

20 01-04-2035 2711909 50000 3750 203393 2969052

21 01-04-2036 2969052 50000 3750 222679 3245481

22 01-04-2037 3245481 50000 3750 243411 3542642

23 01-04-2038 3542642 50000 3750 265698 3862090

24 01-04-2039 3862090 50000 3750 289657 4205497

25 01-04-2040 4205497 50000 3750 315412 4574659

26 01-04-2041 4574659 50000 3750 343099 4971509

27 01-04-2042 4971509 50000 3750 372863 5398122

28 01-04-2043 5398122 50000 3750 404859 5856731

29 01-04-2044 5856731 50000 3750 439255 6349736

URVI'S PF

Page | 28

RETIREMENT PLANNING

In the first year of retirement, Sameer will purchase a land worth Rs.50000000, and

he also build a hostel worth Rs. 50000000.

From exact next year of purchasing the land, he gives the land in rent @ Rs.3600000

p.a. and also get returns from hostel Rs 3600000 p.a. every year.

Sameer and Urvi’s NPS Scheme will get matured after retirement. They will get an

amount of Rs.791965 as a maturity value and it well fetch an annuity amount of

253296 every year.

After paying the premium of ULIP of Sameer, on the maturity he will get cash inflow

of Rs 425170 after 5 years of retirement.

After paying the premium of ULIP of Urvi, on the maturity they will get cash inflow

of Rs 450000 after 7 years of retirement.

Years

NPS

Annuity of

Sameer

NPS

Annuity of

Urvi

Total

IncomeExpenses ULIP2 (S) ULIP2 (U) Cash Inflow

Yearly Fixed

IncomeSurplus

61 253296 253296 506592 349140 17133 18635 4842702.6 6000000 10964387

62 253296 253296 506592 368343 17133 18635 6000000 6102481

63 253296 253296 506592 388602 17133 18635 6000000 6082222

64 253296 253296 506592 409975 17133 18635 6000000 6060849

65 253296 253296 506592 432523 17133 18635 6000000 6038301

66 253296 253296 506592 456312 17133 18635 425170 6000000 6439682

67 253296 253296 506592 481409 18635 6000000 6006548

68 253296 253296 506592 507887 18635 450000 6000000 6430070

69 253296 253296 506592 535820 6000000 5970772

70 253296 253296 506592 565291 6000000 5941301

71 253296 253296 506592 596382 6000000 5910210

72 253296 253296 506592 629183 6000000 5877409

73 253296 253296 506592 663788 6000000 5842804

74 253296 253296 506592 700296 6000000 5806296

75 253296 253296 506592 738812 6000000 5767780

76 253296 253296 506592 779447 6000000 5727145

77 253296 253296 506592 822316 6000000 5684276

78 253296 253296 506592 867544 6000000 5639048

79 253296 253296 506592 915259 6000000 5591333

80 253296 253296 506592 965598 6000000 5540994

Post Retirement Cash Flow

Page | 29

POST RETIREMENT RETURNS

Note:-

In the first year of retirement, Sameer will purchase a land worth Rs.50000000, and he

also build a hostel worth Rs. 50000000.

From exact next year of purchasing the land, he gives the land in rent @ Rs.3600000

p.a. and also get returns from hostel Rs 3600000 p.a. every year.

Years Return from Hostel Rent of land Total

61 3600000 2400000 6000000

62 3600000 2400000 6000000

63 3600000 2400000 6000000

64 3600000 2400000 6000000

65 3600000 2400000 6000000

66 3600000 2400000 6000000

67 3600000 2400000 6000000

68 3600000 2400000 6000000

69 3600000 2400000 6000000

70 3600000 2400000 6000000

71 3600000 2400000 6000000

72 3600000 2400000 6000000

73 3600000 2400000 6000000

74 3600000 2400000 6000000

75 3600000 2400000 6000000

76 3600000 2400000 6000000

77 3600000 2400000 6000000

78 3600000 2400000 6000000

79 3600000 2400000 6000000

80 3600000 2400000 6000000

Post Retirement

Page | 30

ESTATE PLANNING

At the age of 80, Smaeer will have a huge estate to leave for the next generation. The following

table shows his list of estate:

Estate Name Value

His House ₹ 4,37,74,775.94

Spouse House ₹ 4,37,74,775.94

Land ₹ 5,00,00,000.00

Equity ₹ 2,20,01,451.05

Hostel ₹ 5,00,00,000.00

Total Surplus ₹ 1,09,64,386.00

Total ₹ 22,05,15,388.94

List of Estates