M. Pattabiraman's Blog, page 30

What is income laddering in retirement planning?

This article discusses income laddering (aka annuity laddering) in retirement planning and how to go about it. There are two extreme options in retirement planning: one where the corpus is managed in a diversified portfolio, and an increasing income is withdrawn from it as required. This is known as the bucket strategy.  We had earlier...

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National Pension Scheme Fund Screener Dec 2024: Shortlist consistent performers

This is a National Pension Scheme Fund Screener to shortlist consistently performing NPS schemes. You can also spot NPS schemes with a higher return than a benchmark at a lower risk. This is similar in design to the freefincal Equity Mutual Fund Performance Screener. Inside, you get discounted links to our robo advisory tool and...

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After a MF redemption, how do I calculate the net investment?

A reader says, “Suppose my total investment in a mutual fund is Rs. 12,000, and its current market value is Rs. 17,000. If I redeem Rs. 8000, how do I calculate the current total investment?” Each time we invest in a mutual fund (or stock), we buy units at market price. Each time we redeem,...

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What is the corpus required to retire by 50 if I am 28?

Let us discuss a retirement plan for a 28-year-old who wishes to retire by age 50. These are the following inputs and assumptions used in the retirement calculation. Age 28; Retirement age 50; Life expectancy age 90; Monthly expenses Rs. 40,000; Current corpus is practically zero; Inflation before retirement: 7% and after retirement 6%, Return...

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Finfluencer vs Financial Expert: What are the differences?

A reader asks, “What are the differences between finfluencers and financial experts? Is there any way to distinguish them? How can investors be wary of finfluencers?” Definitions for both types are subjective, and these are mine: A finfluencer has a good understanding of the kind of content that would be lapped by consumers (viewers/readers/listeners) and...

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Stocks with low volatility and momentum for Dec 2024

We publish a list of stocks with low volatility and momentum each month. We provide data for BSE 500 and BSE 100 stocks. There are now three different screener files available. (1) Stocks with low volatility and momentum from the BSE 100 large cap universe are available as a separate file (2) Stocks with low...

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What is a safe withdrawal rate in retirement planning?

What does the term “safe withdrawal rate” mean in retirement planning? The safe withdrawal rate, or SWR, refers to the amount of money that can be withdrawn annually from a retirement fund in the first year of retirement. This rate is calculated by dividing the initial withdrawal amount by the total money available for retirement....

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A risk reduction strategy for your equity investments

For a long term goal, invest about 60% in equity and the rest in fixed income. Three years before the goal deadline, start reducing equity allocation. This is the usual advice peddled around by “experts”. How successful is this idea against a rigorous backtest? As you might guess, this is just arbitrary gyan, and if...

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Can I retire early in this uncertain market?

A reader says, “I was planning to retire in early 2025. The markets in the last few years have been good to us all, and I was confident about retiring early (I am 45). But now, I am not so sure. I have used your robo-advisor tool for the last four years and, with its...

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Lessons from 14 years of making retirement calculators

I have been making retirement calculators for 14 years, which are some lessons I learned. My first calculator was made around 2010 or so. I shared it with PV Subramanyam (Subra of subramoney.com) for feedback. Like everyone else using a retirement calculator for the first time, I, too, was scared to see the corpus I...

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