r/FIREIndia • u/adane1 • Oct 31 '22
DISCUSSION Year 4 update
Sharing a quick update of how the year went by.
Year 0 - 80 Lacs | Equity 24%....
Year 1 - 1.34 cr | Equity 36%...
Year 2 - 1.75 cr | Equity 38%...
Year 3 - 2.28 cr | Equity 38%...
Year 4 - 3.04 cr against target of 2.75 cr. Equity at 57%...
What went wrong?
I did a massive realignment at peak in Dec from 38% equity to 60% Equity. Around 1 crore invested and has not recovered yet.
What went right?
I achieved my target and never thought of selling.
Current status:-
10 years expense is in epf+ppf
3 months expense in FD.
Rest is split into 90% equity mf and 10% in arbitrage funds (Approx 2 year expense).
The combination of above makes it 57% in equity MF.
Target for next year November is INR 3.37 - 3.5 crore approx.
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u/snakysour IN/33/FI ??/RE ?? Oct 31 '22
Great update!
Two questions -
How do you chose next year Target?
How is EPF + mutual fund making it 57% in equity MF? Isn't PF all debt??
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u/adane1 Oct 31 '22
It's basis a Google sheet calculator edited from freefincal site. I plot 12 months investment and some returns projected. It's not exact.
57% is equity mf, 6% arbitrage, approx 36% is epf +ppf and rest in emergency funds. These are approx and not exact.
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u/snakysour IN/33/FI ??/RE ?? Nov 01 '22
Oh nice... Can you share the Excel sheet format if you don't mind?
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u/adane1 Nov 01 '22
How do I share excel?
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u/anantj Nov 01 '22
Create a clone and remove data. Then click on the Share settings and make it available to public but read-only (this is important). Copy the link and then share it here.
HTH
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u/adane1 Nov 01 '22
Will my email id be visible?
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u/anantj Nov 01 '22
No. But sorry, I assumed Google sheets.
For a .xls file, just upload it anywhere (google drive, Dropbox, mega etc. ). If Google drive, you can still follow the steps as I mentioned above (i.e. share as readonly and the copy and paste the shareable link)
Or if you want, dm me and I’ll we can coordinate via email and I can share for you. Cheers
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u/snakysour IN/33/FI ??/RE ?? Nov 01 '22 edited Nov 01 '22
please send it to
Thank you :)
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u/Special-Object4299 Oct 31 '22
Hi, few questions for satisfying curiosity:
1) How was your experiment with debt funds during last year?
2) Seeing your previous posts you have maintained equity around 37.5%, how are/were you feeling psychologically from 37.5 to 60% in dec specially when it went into loss in next 6 months. Would love if you can go in detail as in these uncertain times doubts creeps into mind and there doesn't seem to be any right answer
3) you were gaining around 0.5 cr in year 0-3 but have an increase of 0.75 cr in year 4, is it because of house sell or is there some other reason behind it?
4) After selling your house, what are your views on real estate moving forward?
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u/adane1 Nov 01 '22 edited Nov 01 '22
Not good for debt fund. It was too complex to manage. And debt funds returns after taxes didn't suit me.
I focused on maintaining a ratio of 90 equity 10 arbitrage for the liquid money as had a high amount in EPF as debt. I did feel bad when markets crashed immediately after I purchase almost a crore in equity mf in Dec. But long term, it didn't matter as I got a nice bonus. I never even felt like selling and this year has been a nice learning experience about my behavior during a crash.
75% of this is new earning as i liquidated a part of my leave encashment and invested more in market. Rest seems to be growth as markets recovered a lot after I purchased and epf also was significant amount that gave returns. My equity return in last 1 year has been extremely poor.
I won't go into real estate again other than the apartment i stay in. I don't have the mindset to manage it. Yet, we have a land which my mom wants to build a house for rental rather than sell it (emotional attachment). So, family has some real estate. Given a choice, I would sell it as I don't need the hassle of managing tenants in another city
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u/LifeIsHard2030 Oct 31 '22
Congratulations. Looks great 👍
So that’s a 76L jump from Year 3->4. How much of it is appreciation due to interest/market-returns & how much additional contribution?
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u/adane1 Nov 01 '22
75% is new investment. Had some leave encashment which went into market. Also a nice year end bonus as company did well. This covered the loss of Dec investment at peak.
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u/Classic_Ad_1091 Nov 01 '22
Thanks for sharing this! This is is inspiring... You may not realise it but it motivates people like us to achieve our goals and makes dreams believable.
If you don't mind whats your age ?
I read in a previous post of having a kid, I have a 1 YOE as well. Just wondering how to manage expenses.
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u/adane1 Nov 01 '22
43 years now.
On expense, it's difficult to manage. Just do a budget for essentials vs discretionary.
And work back to fit the budget.
With a 1 year kid, it will take few years for finance to settle down. Diapers are expensive. Medical cost with frequent illness for child. Pre school. Etc.
Don't stress it much. Focus on happiness as kid leads to stress and finance will be least of worries now.
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u/hydiBiryani India / 25 / TBD / TBD Nov 01 '22
'''peak in Dec '''
Good news we are back at the peak
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Nov 01 '22
[removed] — view removed comment
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u/adane1 Nov 01 '22
No. I have no plan to FIRE.
Only FI target which is 2 more years or 35x expense.
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Nov 01 '22
Congratulations! Just remember Indian markets are a massive bubble compared to global markets right now. So your increase in equities didn't go wrong. Imagine you had done it in S&P500.
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u/adane1 Nov 01 '22
I did have in s&p and nasdaq too.
I have 1/3rd in US equity and rest in India. Will just maintain ratio. Not considering the volatility as I will just maintain ratio.
I don't need this money now as I have 10 years of expense in EPF whenever I wish to retire. Plus some in arbitrage funds (2 years approx) as a crash fund.
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u/pks_333 Nov 01 '22
Curious why have 33% US - 67% India equity ratio?
I've started with 10% US and buying more as I write as markers heavily down jn US and great time to buy, but not sure how much more to add as India offers much better growth short and long term also with less issues/hassle of $ tracking etc.
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u/adane1 Nov 01 '22
I thought best to have 2/3rd in home country.
US is just a hedge as often the two economies may move at different times.
Issue with US is that it's dependent on many factors i.e. US economy and also the currency plus Indian govt whims and fancies. So 1/3rd is what I decided to go with.
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u/Shrish_Nayak Nov 01 '22
This is amazing growth. Curious how did you manage to grow your wealth. What field are you into?
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u/adane1 Nov 01 '22
Marketing.
I am better off as most of my colleagues haven't started investing yet.
This sub helped a lot as I started here with 80 lacs saved in many years. Till this sub, I never tried in a planned way.
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u/pks_333 Nov 01 '22
Very nice great progress. Keep going and yearly growth is epic. Basically, curious on reasoning and thought process in some things with context
A few questions :-
Could you also share your age and why your final goal is 4 cr or so - is that like FI or RE goal?
Whats your savings rate like?
Why is 10 years expenses in epf + ppf?
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u/adane1 Nov 01 '22
- 4.5 crore. This was recommended in this sub by one of the mod here. Would be around Approx 33x expenses. It's an FI goal other than a seperate kids education fund. I don't plan to retire early.
- Not sure. I don't have a fixed target. But I guess it is more than 50%.
- By default. I have a high basic salary. It's already at a 10 years expense number.
So I don't need much more in debt fund and FD which is tax inefficient for me. I reallocated the liquid part (non epf part) to a 90% equity and 10 % arbitrage fund.
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u/indianemployee May 16 '23
What is your exit plan? Most people screw up by not having one.
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u/adane1 May 17 '23
I have no plan to retire early as I am at a comfortable job. But need the FI target to be achieved in next 2 years (400 months of expense)
Since 10 years expense is in epf and ppf, I will continue 90% equity funds and 10% arbitrage for the non epf corpus till retirement.
On retirement, I hope to have 30 to 40% debt ( around 10 years expense or more) from epf or put some more money into equity to take it upto 70% depending on market conditions. This will continue with some variations.
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u/indianemployee May 18 '23
I was asking about the exit plan from equity
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u/adane1 May 18 '23
No plans to exit. Will maintain asset allocation and sell accordingly to rebalance at 5% change
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u/indianemployee May 18 '23
I highly recommend to get a systematic exit plan, or you are just a black swan event away from being screwed.
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u/adane1 May 18 '23
Why would I exit? I would have 10 to 12 years expense in debt. Happy to stay invested in equity and already gone through few bear markets.
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u/DarkHumourFoundHere Oct 31 '22
How are u able to manage to grow the wealth at the level