How did this smart doctor make his dream home free?
This finance anecdote is about two childhood doctor friends, Dr. Sunil & Dr. Prateek, living in Mumbai. They are all grown up and are both married to doctors (goes without saying, lol). Dr. Prateek has recently bought a new house and invites Dr. Sunil and his wife for an inauguration dinner.
After a tasty meal and some drinks, the conversations started flowing. After praising the resplendent decor of the new home, Dr. Sunil started talking about the heat of heavy EMIs he has been facing after mere three years of buying his own ravishing home. He out of concern also warned his bestie Dr Prateek of the same heat and advised him to cut on extra expenses from today itself. Dr Prateek smiled big from ear to ear and said he had already made his expense sheet before buying the new house.
The satisfaction on Dr Prateek’s face instigated Dr Sunil to know about his smart plan of money. Dr. Prateek had invested 20% of the loan amount of house in Sukhanidhi’s elite equity portfolio for the next twenty-five years. And here goes a calculation of the same.
Dr Prateek bought a home for ₹55 lakhs inclusive of insurance. He made a down payment of ₹10 lakh and had taken a home loan on the rest of ₹45 lakhs on 8.15 per cent interest. He invested 20 per cent of ₹45 lakhs, i.e. ₹9 lakhs separately as an investment to make his new home free in Sukhanidhi’s elite equity portfolio for 25 years (Home Loan Term).
The expected approximate return* percentage on the Elite Equity Portfolio is about 15 per annum (excluding dividends & Bonus). The difference between the loan interest of 8.15 per cent and the return of 15 per cent goes very far because of the long time span of 25 years. By the time Dr Prateek’s Home Loan EMI’s ends his investment portfolio of Rs. 9 lakhs would have grown to whopping amount of ₹2.94 crore rupees and so the Total Home Loan Repayment for 25 years is ₹1.05 Lakhs and Investment corpus is Rs.9 Lakhs which amounts to ₹1.15 crore rupees.
He has not only built a smart Home Loan EMI recovery plan for himself and bought himself a home for completely free but also planned to create a wealth of ₹1.81 crore rupees. (i.e., ₹2.96 minus ₹1.15 Crores).
Dr Sunil is impressed by this game of numbers and is looking forward to investing in Sukhanidhi’s elite equity portfolio too.
We, at Sukhanidhi, are on a massive mission to help 100,000+ healthcare professionals like Dr. Prateek and Dr. Sunil to not only get their dream home for free but also build a successful retirement corpus. We understand the fact that the practice hours reduce by age and everybody needs a passive income flow while getting old. We are waiting for you to join the mission, who are you waiting for.
Happy investing!
About Author
Vinayak Savanur
Founder & CIO at Sukhanidhi Investment Advisors, a SEBI registered equity investment advisory firm. He has nearly a decade of experience in the stock markets and has been a holistic financial planner.
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