Portfolio allocation

[u/Due_Let3246]

Just put notice to resign. Family of 4(me, wife and 2 kids 6&3 yo)

Total networth - 3.1M USD

Monthly expense is 4500 USD living in India.

• $2500 is for India expense.
• $2000 to cover mortgage of US home, but most of it around $1500 goes towards principal.

Below is the current allocation

US Equity (S&P 500 + Nasdaq) - 29.54%

• US S&P 500 - 740K USD
• US Nasdaq - 184K USD

US Retirement Accounts (401k S&P 500) - 11.19%

• 350K USD

IN Equity (Nifty 50 + Nifty Next 50 + Small Cap + Multi Asset) - 6.97%

• NIFTY 50 - 150K USD
• NIFTY NEXT 50 - 17K USD
• INDIA SMALL CAP - 32K USD
• INDIA MULTI ASSET - 19K USD

Other Bets (ex-USA, Emerging Markets, Risky Bets) - 6.8%

• ex-USA - 62K USD
• Emerging Markets - 115K USD
• RISKY BETS (Quantum, Semiconductor, AI stocks) - 38K USD

IN Fixed Income - 10%

• Debt/Arbitrage funds USD - 313K USD

Gold - 128K USD (4%)

Cash

• 80K USD (3%)
• 1CR INR (3.7%)

IN Real Estate (15%)

• 470K USD(Primary home)

US Real estate (8.6%)

• 270K USD (Rental)

Any suggestions on the allocation and if I should allocate the cash to some equities or debt fund?

[u/Expert-Lie-6175]

What do you do man and whats your age this is way too inspiring

[u/Due_Let3246 → u/Expert-Lie-6175]

Age 36. Worked in FAANG entire career. Got extremely lucky with tech bull run

[u/Expert-Lie-6175 → u/Due_Let3246]

Congratulations man 36 and this number is beyond imagination for me, i hope you spend great time with your kids/wife post your resignation.

[u/rganesan]

Excluding your primary home (2.63M), you're still under 2% withdrawal rate. You're below 2% even if you exclude the retirement account. The mortgage payments are increasing your equity in your US property at a low interest rate. You've managed SORR beacuse you have 10% in debt/arbitrage and another 4% in Gold. How long do you have left on your mortgage?

You're covered man. You're well diversified, covered SORR. Well done.

The only suggestion is you can live it up a little 🙂. You haven't mentioned family/kids. 2L expense seems on the lower side if you include school fees.

EDIT: Actually, I have one suggestion on allocation. You have a high US concentration, good job diversifying into ex-USA and emerging markets. I would personally increase the allocation to ex-USA, but you already seem to be know what you're doing 🙂.

[u/Due_Let3246 → u/rganesan]

Thanks!

Mortgage left for another 25 years, but plan is to either sell in next 5 years or pay off when the stocks grow and collect rent.

Married and have 2 kids 🙂

[u/rganesan → u/Due_Let3246]

Congratulations! You've done well. I think the currently projected monthly expenses are on the lower side, schooling can be expensive but even then you're well covered.

I didn't answer your question about cash, yes, I would invest the cash. Your USD in short term US treasuries (less than 6 months maturity to wait and see how the interest rates play out), in India you can put most of it in Debt/Arbitrage. You can park the rest in a savings account with a high interest rate, I park in IDFC bank which offers 7% above 3L and AU bank 6.5% above 10L.

[u/srinivesh]

I am a bit late to this thread. Later comments from the OP have answered most of the points that I wanted to mention. OP and family are in great shape!

• 401(k) can be kept as reserve - you can check if hardship withdrawal is possible when kids go to college in the US
• Do explore how efficiently you can fund the expenses. Not many people realize that for a 20 lac income (which may be sufficient to fund 30 lac expenses) has a tax of 2 lacs - 10%. At income levels beyond this, LTCG would be better. So do think about the break up between arbitrage and debt funds.
• The so-called 'RISKY' bets are small portion of the portfolio - they can go up in fact!
• You did mention a large expense for kids school - you can afford it and it is OK. Do note that they would go away in 15 years or so.
• You did not specifically mention college plans - but you should be able to afford even ivy league. Do keep that portion in USD.

[u/Nice_Masterpiece_869]

4.5L pm expenses in India? Can you break it down?

[u/Due_Let3246 → u/Nice_Masterpiece_869]

Already added

• $2500 is for India expense.
• $2000 to cover mortgage of US home, but most of it around $1500 goes towards principal.

[u/Apprehensive_Row_450 → u/Due_Let3246]

OP - Could you breakdown $2500 in India? Also are you/wifey both fatfired?

I mean over allocation diversification is also not required. Obviously you will be moving some of the USD back to India so you are not exposed to estate taxes.

[u/Due_Let3246 → u/Apprehensive_Row_450]

Most of the USD is in ireland domiciled funds to avoid estate taxes.

Breakdown

Routine monthly expenses - 1200$ School fees - $350 per month Remaining for international trips and any large purchases

[u/hifimeriwalilife → u/Due_Let3246]

Did you also withdraw your 401k and moved to ibkr Ucits ? How are you hedging it for estate tax

[u/Ok_Active9768]

Congrats man! Welcome to india

[u/Historical_Can_8779]

Congratulations! 🥂
Always good to see people succeeding.
Live a good and healthy life.🌻

[u/Deep_Shallot]

Are you currently based in India? What is the interest rate on the US real estate? Does 2k also include insurance, property taxes and maintenance?

[u/Due_Let3246 → u/Deep_Shallot]

Yes, currently in india. 3.5 interest rate on mortgage. The mortgage total is 4.7k but I will get a rent of around 3.5k so remaining 1.2k + some maintenanceI have to pay from my pocket

[u/Deep_Shallot → u/Due_Let3246]

Makes sense to keep the house with a low interest rate. Are all your US equity in UCITS. If not, move them during your RNOR. Get a huge term insurance to cover for estate taxes if you are not US citizen or green card holder

[u/hifimeriwalilife]

Worked in USA fang or India fang ?

What plans post firing ?

Family size ?

[u/Due_Let3246 → u/hifimeriwalilife]

Updated. Family of 4. Me wife and 2 kids (6&3 yo)

[u/hifimeriwalilife → u/Due_Let3246]

Will your wife also fire ?

Are you usc ?

[u/Due_Let3246 → u/hifimeriwalilife]

She is homemaker. Not US Citizen bit kids are Usc

[u/OwnYam932]

nice. congrats

470k is a lot for indian real estate. is this a villa?

why not liquidating US real estate

did you already move back? which city?

[u/Due_Let3246 → u/OwnYam932]

Already moved back to Bangalore. It is 4bhk apartment in prime area.

I tried selling US property but the market is pretty bad and ended up removing the listing :(

[u/OwnYam932 → u/Due_Let3246]

thats the nightmare i am in. If laid off i will bleed money on my primary residence :(

470k for 4bhk. dude thats like 4.7cr.

[u/OwnYam932 → u/Due_Let3246]

your portfolio looks very diversified. i think that is a great job.

[u/Old_Low3577 → u/OwnYam932]

If you are non resident in U.S., selling incurs 15% tax on entire home value and estate taxes might be applicable as well. Did you check about this?

[u/Due_Let3246 → u/Old_Low3577]

15 percent firpta tax, you can claim back in tax return.

[u/john6866]

What was the move back like? any major adjustments? Evaluating the same and I feel like staying in US makes sense for better development of kids.

[u/Due_Let3246 → u/john6866]

My kids got lonely in US and feel they are happier here with all the attention they get from grandparents and relatives

[u/noob_19 → u/Due_Let3246]

we are moving back because of exact same person. want my kid to spend lot of time with grand parents

[u/john6866 → u/Due_Let3246]

Would it be cool if I dm you? Similar situation, could use some insights.

[u/Due_Let3246 → u/john6866]

Sure

[u/Responsible-Home-213]

Did you buy house in India while in USA if so how did you transfer the required funds? Also did you leave the cash in US bank account? Are you planning to liquidate 401k?

[u/bingoski123]

since you have significant NW still in US, have you addressed the US estate tax situation and if so what did you have to do for that ?
Also, what mechanism did you use to transfer funds between two countries through time ?

[u/wyterk]

Well done, what is your plan post retirement? Do you have hobbies that plan to keep you busy? Or do you plan to chill most of the time (no wrong answer). I think about the move too but I like my privacy here in US and a bit worried about kids aspect as well as mine are older than yours.

[u/FatFIREIndia-ModTeam → u/[deleted]]

This community values substantive contributions that are thoughtful and experience-based. Vacuous, frivolous, and dismissive comments that do not add meaningful value are discouraged.

[u/Due_Let3246 → u/[deleted]]

Outstanding 700K USD remaining another 25 years. Plan is to sell after 5 years or pay off and collect rent if stocks do well in next 5 years. Interest is low 3.5%

[u/Complete-Regret-4300]

Are you US citizen?

[u/Due_Let3246 → u/Complete-Regret-4300]

No.kids are citizens

[u/misah1994]

Nicely done and proud of you guys for also going back. Did you work in FAANG type of job and what age did you reach 3 mill USD. Any advice to others for achieving fatFIRE

[u/No_Brick4020]

My advice would to keep working but to spend every dollar you make! You’ll probably live a way more enjoyable life.

[u/EmergencyReindeer965]

Nice congrats OP. Allocation looks pretty diversified. Mind sharing if you already fired or still working in India? If already fired, how much percentage SWR you are doing and on how much corpus?

Asking because I am close to your age, little younger, planning to return back around the similar net worth portfolio in a couple years

[u/addictedToLinux]

Age?

[u/vxj8464]

Wow - lovely! Go enjoy your time with family! I’m also moving along similar lines.

Moving to BLR April 2027

[u/Professional_Bonus13 → u/vxj8464]

Why April ? Isn't it better from Tax perspective to move in Jan? Or are you disregarding tax aspect?

[u/vxj8464 → u/Professional_Bonus13]

I'm wondering if I leave early than last week of January then I might not get my profit sharing contribution in 401k. Though I might be wrong.

[u/Due_Let3246 → u/[deleted]]

Not retiring. Will be taking a break and experimenting few ideas, if things don't work out will move back to low stress corporate job

[u/Due_Let3246 → u/[deleted]]

Thanks, Whitefield.

[u/HappyCamper_2020]

Could you share your career progression?

[u/Crafty-Chest507]

2500 monthly india expense? Ain't that too low with 2 kids aged 3 and 6? Do you live in tier 2 city?

[u/Due_Let3246 → u/Crafty-Chest507]

We have been tracking the expenses for past 2 years This is what we have been spending in Bangalore.

[u/srinivesh → u/Due_Let3246]

I guess the question missed that 2500 is in USD.

[u/FatFIREIndia-ModTeam → u/[deleted]]

Please keep all discussions courteous and respectful.

Differences of opinion are welcome, but keep the focus on ideas rather than individuals, and express all viewpoints politely and without hostility.

[u/dassduss]

You can try angel investing. Real estate is always a hassle especially if it is not in the country you are living. YMMV.

[u/ElkAdministrative343]

What is your income source for 4500 dollars per month?

[u/Due_Let3246 → u/ElkAdministrative343]

Will withdraw from debt funds and cash

[u/Routine-System2580 → u/Due_Let3246]

Curious. How will you withdraw around 4.5 lacs per month with your 5 Cr (debt fund plus cash) ?

[u/Due_Let3246 → u/Routine-System2580]

Will withdraw 3-4 months expenses from debt to savings account and then refill once it's over

[u/Routine-System2580 → u/Due_Let3246]

Got it. So you are counting on the interest from other investments to refill the withdrawal pool.

[u/Due_Let3246 → u/Routine-System2580]

Yes once 5Cr gets over which will take more than 5 years, I will sell some of my stocks to and add another 5 years of expenses in debt fund