I am currently unemployed, how should I invest my savings?

Can you help me figure out how to save or invest money for my retirement and my daughter’s education. My current loans are:

Home loan of 59 lakh— NDE of 54,000 per month for 15 years; loan against the property of 27 lakh—EMI of 25,000 per month for 15 years. My current monthly income is 62,000 and my husband wins 80,000.

My current investments are: 12,000 per year for the LIC insurance premium; 15,000 per year for the term plan premium for 50 lakh cover for both of us; MS from 10,000 per month, Medicclaim of 21,000 for 5 lakh hedge, share value 2,000,000; and a fixed emergency fund deposit of 7,000,000.

—Sneha Abhishek Murkar

Since a significant portion of your income is used to pay for EMIs, you need to keep an eye on interest rates. You should also aim to gradually reduce and prepay the loan on the property, as this loan will have a higher cost of borrowing than the home loan. You should own the stock portfolio provided you can keep track of it. Instead, you can consider buying mutual funds and gradually increasing the monthly investments. Asset allocation can be done based on your financial goals which at first glance appear to be long term and therefore stock allocation can be favored depending on your risk appetite.

I came back from Nigeria after a few years. Now I am 48 years old. Despite spending on my wife’s cancer treatment, I still have some savings. What should my investment plan be for this? Also, I am now unemployed and looking for a job or starting a small business.

—Abdul Wahid

You need to create a regular source of income because you are currently unemployed. Even if you plan to have your own startup, you will still need a steady income until the business is established. And once your regular income comes from your job or business, the income from your investments can be stopped and converted from a payout to a cumulative/growth option. A portion of your savings should be invested in an emergency corpus and be available on call. Also, you can consider regular income-generating investments with higher coupons like post office, RBI bonds with interest payment. Part of the portfolio may be invested in equity FCPs. You should also make sure that you have a medical insurance policy for you and your family.

Surya Bhatia is the managing partner of Asset Managers.

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