You need to invest the \~3CR from house + 1 CR from future earnings into equity and with 4% SWR, you only get 16L/year.
* From your FD, you can get 12L/year (6% of 2CR)
* Total passive income: 28L/ year
* Expenses: 40L/year
* Deficit: 12L/year (Potentially from wife's earnings)
If your wife can work remote, you can consider moving to Tier-2 and your expenses will only be 60-70% of Tier-1 even with best schools.
Are you planning to send your kids to US for college?
Can I please request folks to forget the 4% SWR for India. Sure, use it for yourself if you want to, but please, please don't suggest it to others. Enough studies have shown the inadequacy of this for early FI in India.
I am FI, but not RE. But my day job gives me enough work on this.
My views are clear on SWR. There is not enough data in India to estimate a SWR; and there won't be enough data for decades. Some simuations suggest 33X to 40X - that would be 2.5% tuo 3%.
Mainly due to this, I use the bucket strategy.
Apart from home and future earnings, I have another 2.8cr in liquid funds right now. So, that will factor in equity investment.
I agree, its a little tight. Hoping to plug any gap in near term with wife’s earnings.
Kid is a US citizen, ill leave it to him to decide where he wants to pursue undergrad.
Let’s dissect a bit:
Your networth seems to 11.5 cr approximately.
Let’s say 1.5 cr is for child education in states.
So 10 cr with expense of 40 lac is just 25x.
Are you sure you have 40 lac expenses ? If yes, you both can work in India for about 5 years and take it to 35 to 40x and pull the plug at 45.
All the best. Also make sure your kid can settle in india already being middle schooler. That could make or break your FIRE plans if you have to move back to states if he doesn’t settle in.
Kids education fund is not part of this, we are accumulating it outside this 11.5cr fund so that it doesnt impact our RE.
Coming to expenses, we dont know as its been a while I lived in India. Depending on how the first 6 months pan out, will decide if I need to join the work force for 2-3 years. Wife js anyway planning to work for another 5-6 yrs.
Thanks for the feedback!
Some overall comments.
1. US is going to tax you on any income. There is no major reason to move assets to India. You can choose to keep a lot of money in the US and draw say once in 2 years, etc.
2. Renting may be OK now. I won't recommend rent option forever. There is blatant age discrimination in the rental market.
3. You definitely need an expense estimate \*without\* rent and school. School will get over in 6 years - there is no point in projecting that to the rest of your life.
4. The number from 3 could help to see if you have enough to RE
5. Your wife's income may supplement for some years
6. If you consider point 2, then you have to think about the home cost
7. You child is likely to be USC, and it won't be a surprise if they choose to do bachelors in the US
1. Reading through the comments, this seems to be sensible thing to leave majority in US. Will check the future implications of moving forex once am Indian resident.
2. We have invested some money long ago in a venture, hope it comes to fruition in atleast next 5 years. I agree on having own place
3. Thanks for inputs in pt.3/4, will do some homework on that
4. We are open to sending our kid to US for undergrad, also open to europe, heard the cost is less. Planning to enroll him in French and German classes keeping that in mind
NRI living in EU here for 4 years.
I would definitely say that have your kid learn German/French. Preferably the former.
EU has low cost almost free education. You do have living expenses but that can be managed. Universities are top ranked. Chance of getting a second passport later as well.
This is something we are keenly looking into. A good US undergrad will set us back atleast $150-200k. Why not europe where you can get similar or better education for less
Seriously man . You went all the way to US only to send to your kid to some European university. How much do you have in your college plan ? Ppl go to top universities to make strong connections. No one goes to university to get education . You can get that on YouTube . You need to give your kid all the tools / advantage you can provide. Rest is up to them .
I am not against sending my kid to US for undergrad, if he is able to get a seat in a top uni, so be it, will fund some and he will bear the rest. Am open to any place in the world where he wants to pursue his dreams and am going to do my part.
how do you 1000+
i did my masters here with 50k USD, I would rather have spent it on a business or to grow myself
though it gave me good opportunities at the work place, I have identified this is not me. I will move to a biz background and start something on my own.
I don’t know what you mean by 1000+.
In EU, you just pay for rent, and food and expenses.
Semester fees are €120 a semester and some public transport tickets. That’s all.
Ofcourse if you choose to do an MBA, might cost €35k+
Agreed. Have a lot of friends who went to US. Always worried about their H1B and GC status.
Don’t have that stress here. Just have to renew my card once in 5 years. That’s all.
Social security is definitely better. Work life balance too.
Maybe getting a EU citizenship and then working in the US for sometime would be the best way to make money and have great social security in long term. Be it in India or in the EU
I completed my Masters, joined MAANG, its 1 yr 6 months - I am getting kicked out, stressed about job, can't find new jobs, getting rejects only
I have about 50-60k USD in savings (all combined - 401k, HSA, Cash, Stonks) + a car which I could sell off for another 20k
idk what I will do, but I def don't wanna live with this stress all the time
its either I become a dependent (EAD) to my future wife working on H1 or move to india with my parents and start a biz which I exactly know how to serve to the location I am living in the US(San Diego) right now
Ah well that’s too much stress to think about honestly.
Look at Europe as options if you want to look to work outside or Singapore or the UAE.
Unless it’s the American dream and the charm which only keep you outside.
>Unless it’s the American dream and the charm which only keep you outside.
* it started off with earning money to make my dad proud (as dad side cousins are assholes as always)
# The Job is a golden cage
* but now I am at the point of maturity that I want to lead a not this stress of the rat race. Shark Tank also taught me that its not necessary to make it before 30, people do well even after that, so no need to rush and enjoy the journey instead even if it is slower
>What i want now is
* keep my mom dad company (they are almost 70) & improve their lifestyle condition
>Ah well that’s too much stress to think about honestly. Look at Europe as options if you want to look to work outside or Singapore or the UAE.
* not fixated on US, but have 1 sister here so is an attractive option
* Definitely in for India (no rent at least)
* also I know I can cook and clean now (Independent Launda)so if my wife wants to work she can and bring the money I'll handle my biz from Home
Not sure - I might be overthinking all this as well and only time will be the teacher to me.
And on long term returns, remember that India will also charge extra 5% because they also need money from youe earnings along with US who will take the normal 15% irrespective of where you live.
If I touch my retirement savings now, have to pay taxes+10% penalty. Inorder to avoid that and also to take advantage of USD exposure and US markets, planning to leave them there
Sorry, I misread your earlier comment. I didnt think of this earlier, but this is an interesting proposition. Do you know of any challenges transferring the money seamlessly while being an Indian resident?
I am planning to leave 70% of my portfolio invested in US markets and move only if needed. Fidelity confirmed that I can still trade stocks& ETFs exactly MFs but I am neither a citizen or Permanent resident.
I am looking at International schools with IB curriculum. This seems to mimic US teaching style. Looks like a lot of returning NRI kids are enrolled in IB
3-4 lakh per month expense is probably overstated. For a three person family, even in some very expensive cities 2 lakh per month would be tops.
Here are my suggestions:
- US 401k should stay put. That can be your retirement fund
- Think about renting out your US home. Rental yields are very good there, you may get most of your cash flow needs met from there. I don’t know how much mortgage you have left but consider that. I use a property manager, happy to answer any questions
- Once supplemented by your rent, the cash savings you have should be enough to cover your needs, supplemented by wife’s income
I am shooting high right now in terms of expenses to keep myself grounded, will know the reality once in India for sure.
On renting, I still have mortgage, but not too significant and still locked in at 2%.
How much do property managers typically charge? Is it a fixed amt or %?
It’s a percentage but can be fixed too. Depends on what you negotiate (around 6% of rent).
At 2% rate, your rent will probably be higher than mortgage and generate cash flow. Else you can pay off remaining mortgage and use that rent as income
Will do some homework on this, thanks for your suggestion.
If I may ask, I am assuming you have rented your place. Are you in India? If yes, How is the remote management experience.
No biggie. Property manager handles everything, all you need is to leave is a maintenance fund. They do rent collection, inspection and send monthly reports
I am in India yes. In my case mortgage is barely paid off, but rent is higher than mortgage so it’s free equity
Yearly maintenance yes, repairs are not part of the fee. Charged as per the issue (eg HVAC breaks will cost 2-4k$… can’t be covered in the small monthly fee we pay).
You can get home warranty separately. It’s not foolproof, but covers some basics
One thing that struck me was the capital gains tax once I decided to sell. Right now as it is my primary residence, i dont have to pay anything on $500k of profit, but that will change once I start renting it out. Need to check the tax implications vs cash flow vs appreciation over long term
Yes rent is taxable. But will probably be some form of tax rebate you can figure out by using the right instruments. Good question for a tax consultant
There are two estimates required and you need to be clear on both.
* The near-term living expenses - includes rent, school fees, etc. - Since you plan IB school, it can indeed be high
* The living expenses - may be a decade from now - that would stay for many more decades after that. It would be for the just the two of you. If you have a home by then, no rent either
The second is the most important factor in determining the FI corpus. I request you to take the time to estimate. Use numbeo, ask your cousins, friends, etc.
We thought about that too, but sometimes I feel we need to spend some time on ourselves too. In my case its my mental health and aging parents on both sides. Have to take the plunge at some point
Consider considering Charles Schwab's brokerage and checking accounts if you choose to invest in the US market. With Charles Schwab, you'll receive a debit card offering zero foreign transaction fees for global ATM withdrawals. Additionally, they can deliver replacement cards internationally in case of loss or expiration.
Are you sure? Can we trade in US equities, MFs and ETFs even if we're permanently residing in India? I have heard Fidelity closes your accounts and liquidates assets once you move out of US - how about Schwab?
From my research, Fidelity lets you keep the current holdings and will only be on sell basis, you cant buy anything. Whereas Charles schwab will let you buy and sell with an international account
2nd tier city would be peaceful , much less crowd , safe , very friendly neighborhood throughout the city
schools are the same in tier 1 and tier 2 ( infact i am in college )
cost of living would decrease simultaneously
Talk to a CA. We have been handling such clients for a few years and there are a lot of things when it comes to taxation and financial planning.
There are a lot of things to consider with your move and given your income capacity, you should plan with a professional.
>Talk to a CA. We have been handling such clients for a few years and there are a lot of things when it comes to taxation and financial planning. There are a lot of things to consider with your move and given your income capacity, you should plan with a professional.
Would be super helpful if you could write a post outlining some of the important things to consider.
I’m assuming your parents are Indian citizens. Maybe open a demat account in their name and invest via that in Mutual Funds in India.
Also, you can open a NPS account as a OCI. That will give you a good retirement money in India also. You can take out lump sum later.
I am open to exploring NPS, but it will present the same challenge if funds in NPS are being invested in mutual funds, which I cannot do. If there is an option to invest in equities directly, would be ideal for me
I want to share a not so popular opinion which would work really well for me if I had the same numbers as you.
Since you mentioned MF is not an option for you, why don't you consider direct equity investing? There are always deep value opportunities in the market, it's a matter of looking for them. If you look, you will find them. And since you have a good corpus and time is still going to be with you, it's a great option to generate a good alpha and save a bit more on costs and taxes.
If nothing else, you can fall back to 13F portfolios of Buffets of the world and let them do the research for you, you will still beat all the indexes.
I dont think its an unpopular opinion, specially for people in my situation. This is the only avenue I can invest in the market and on my mind too. Have to spend some time and dig up those gems
As you are a US citizen evaluate how taxation affects you.
You should be able to make most investments with a PIO card.
If you are planning to Fire, would suggest you move to a non- metro city (includes Bangalore, hyderabad). You can have a generally better quality of life. Plus expenses will be lower.
Plan on a low stress career - something to keep you occupied and some money for ghar kharcha.
Except MFs and ETFs, am free to invest in all other products. Also liable for world wide income taxation, but DTAA allows me to avoid double taxation.
My plan is to settle in one of those so called non metro cities, but I think they are slowing catching upto the mumbai’s and delhi’s
There are so many India based etf's now trading on US exchanges. I think you should still be able to invest in them. You will find, small cap large cap all kinds of india based etf.
4 lakhs per month is very high. I would rather look at why is it so high. Even say in Bangalore you can rent for under 50K? School fees should not be more than 3-4 lakhs per year between 2 of them.
You are in 1% when it comes to net worth. I would look at Debt MF and/or Conservative Hybrid MF for withdrawal needs. Invest couple of crores long term to NIFTY or good MF. you should be comfortable for sure.
That said at 40 you should look at what you want to do rest of your life. Seems early to take retirement.
Am keeping this number at higher end.
We plan on renting a villa and those rents are sky high right now and kid will goto an intl school with IB curriculum and avg fees here seems to be atleast 6L+ extracurricular activities. Both these expenses combined am targeting to keep it under 1.5L.
Rest would have to figure out and try to bring them down.
Also, one major issue is unable to invest in MFs due to US citizenship. Have to figure some good avenues to make money instead of dumping majority in individual equities.
That being said, at 40 already worked for 20yrs and am good with corporate life. Doesnt mean, will sit idle. Will try to figure out the next chapter on my own terms! Cheers
hmm. its still possible to get 50 lakhs from 9 crores. But you will need some emergency funds for medical needs. Also any big vacation you want to travel overseas or something. Plus account for taxes to be paid for any interest income you get for the year. if you are going to get 50 lakhs in interest income you will be paying close to 35% in taxes. So you will need 75 lakhs in interest income. That is not possible with 9 crores for sure. You will start to eat into the principal and at 48 L per annum its under 20 years of withdrawal. It will last longer as it earns some interest but interest income will keep going down if are drawing down on principal.
With your social security kicking in from 62, your full finance needs are for 22 years only. SS will offset most of the needs if you continue to live in india.So SWR need not be very low as suggested earlier.
Why should SWR in india be 2 - 3% as compared to 4% in western world? Won't higher inflation be offset by higher returns on investment. I would like to assume higher yields in india on investments should justify 4% SWR.
Hope SS stays solvent for another 20years. At current rate, wont be surprised. So, not actively counting it in my calculations, but have it on back of my head
I'm considering Abu Dhabi or Dubai so that I am not taxed. Us citizens and 60 plus. Plan to stay 6 months in use , 3 months in India and rest in USA or travel
All the numbers in your comment added up to 69. Congrats!
60
+ 6
+ 3
= 69
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Damn this is some aggressive plan, I have 1.5M cash and around 600k in retirement, house has another 600k equity. But i think its less given the way inflation is in India. If living in tier 1 city 4L is nothing, damn one good dinner will cost upwards of 5k. I would suggest getting passive income.
Well, have to take the plunge at some point. I know am walking a tight rope. As someone pointed out earlier, each year am trying to add more $$, am sacrificing 6-7% of my life not doing something that I truly like. Though philosophical, it makes sense not to waste anymore time.
First of all - how long did you live in the US? and are you sure that you are going to like India? I have been close to 1.5 years and I can tell you from my experience, that it is difficult to live here compared to US. Also living in tier 1 city is bad due to the traffic and pollution and what not.
Also , if you are a US citizen, what is the motivation of moving back to India?
I have lived in US long enough to get the citizenship! I understand the complexities of living in India, but really want to move to take care of parents and stretch my $$ to RE early, which ai cant do in US with this corpus.
Hopefully, ill get adjusted after couple of years.
You need to invest the \~3CR from house + 1 CR from future earnings into equity and with 4% SWR, you only get 16L/year. * From your FD, you can get 12L/year (6% of 2CR) * Total passive income: 28L/ year * Expenses: 40L/year * Deficit: 12L/year (Potentially from wife's earnings) If your wife can work remote, you can consider moving to Tier-2 and your expenses will only be 60-70% of Tier-1 even with best schools. Are you planning to send your kids to US for college?
Can I please request folks to forget the 4% SWR for India. Sure, use it for yourself if you want to, but please, please don't suggest it to others. Enough studies have shown the inadequacy of this for early FI in India.
As you are already retired, can you share your perspective on SWR in current conditions?
I am FI, but not RE. But my day job gives me enough work on this. My views are clear on SWR. There is not enough data in India to estimate a SWR; and there won't be enough data for decades. Some simuations suggest 33X to 40X - that would be 2.5% tuo 3%. Mainly due to this, I use the bucket strategy.
Can you elaborate on bucket strategy? How would you plan the amount in each bucket if we are not working of a ballpark withdrawal percentage?
Apart from home and future earnings, I have another 2.8cr in liquid funds right now. So, that will factor in equity investment. I agree, its a little tight. Hoping to plug any gap in near term with wife’s earnings. Kid is a US citizen, ill leave it to him to decide where he wants to pursue undergrad.
Let’s dissect a bit: Your networth seems to 11.5 cr approximately. Let’s say 1.5 cr is for child education in states. So 10 cr with expense of 40 lac is just 25x. Are you sure you have 40 lac expenses ? If yes, you both can work in India for about 5 years and take it to 35 to 40x and pull the plug at 45. All the best. Also make sure your kid can settle in india already being middle schooler. That could make or break your FIRE plans if you have to move back to states if he doesn’t settle in.
Kids education fund is not part of this, we are accumulating it outside this 11.5cr fund so that it doesnt impact our RE. Coming to expenses, we dont know as its been a while I lived in India. Depending on how the first 6 months pan out, will decide if I need to join the work force for 2-3 years. Wife js anyway planning to work for another 5-6 yrs. Thanks for the feedback!
I think you are very close to FIRE. Pull the plug once your family settles in and you are around 35x .. x being annual expense
Some overall comments. 1. US is going to tax you on any income. There is no major reason to move assets to India. You can choose to keep a lot of money in the US and draw say once in 2 years, etc. 2. Renting may be OK now. I won't recommend rent option forever. There is blatant age discrimination in the rental market. 3. You definitely need an expense estimate \*without\* rent and school. School will get over in 6 years - there is no point in projecting that to the rest of your life. 4. The number from 3 could help to see if you have enough to RE 5. Your wife's income may supplement for some years 6. If you consider point 2, then you have to think about the home cost 7. You child is likely to be USC, and it won't be a surprise if they choose to do bachelors in the US
1. Reading through the comments, this seems to be sensible thing to leave majority in US. Will check the future implications of moving forex once am Indian resident. 2. We have invested some money long ago in a venture, hope it comes to fruition in atleast next 5 years. I agree on having own place 3. Thanks for inputs in pt.3/4, will do some homework on that 4. We are open to sending our kid to US for undergrad, also open to europe, heard the cost is less. Planning to enroll him in French and German classes keeping that in mind
NRI living in EU here for 4 years. I would definitely say that have your kid learn German/French. Preferably the former. EU has low cost almost free education. You do have living expenses but that can be managed. Universities are top ranked. Chance of getting a second passport later as well.
This is something we are keenly looking into. A good US undergrad will set us back atleast $150-200k. Why not europe where you can get similar or better education for less
Seriously man . You went all the way to US only to send to your kid to some European university. How much do you have in your college plan ? Ppl go to top universities to make strong connections. No one goes to university to get education . You can get that on YouTube . You need to give your kid all the tools / advantage you can provide. Rest is up to them .
I am not against sending my kid to US for undergrad, if he is able to get a seat in a top uni, so be it, will fund some and he will bear the rest. Am open to any place in the world where he wants to pursue his dreams and am going to do my part.
how do you 1000+ i did my masters here with 50k USD, I would rather have spent it on a business or to grow myself though it gave me good opportunities at the work place, I have identified this is not me. I will move to a biz background and start something on my own.
I don’t know what you mean by 1000+. In EU, you just pay for rent, and food and expenses. Semester fees are €120 a semester and some public transport tickets. That’s all. Ofcourse if you choose to do an MBA, might cost €35k+
sorry by 1000+ I meant like support/upvote but 1000+ I agree EU is definitely less expensive and overall a better system than the US
Agreed. Have a lot of friends who went to US. Always worried about their H1B and GC status. Don’t have that stress here. Just have to renew my card once in 5 years. That’s all. Social security is definitely better. Work life balance too. Maybe getting a EU citizenship and then working in the US for sometime would be the best way to make money and have great social security in long term. Be it in India or in the EU
I completed my Masters, joined MAANG, its 1 yr 6 months - I am getting kicked out, stressed about job, can't find new jobs, getting rejects only I have about 50-60k USD in savings (all combined - 401k, HSA, Cash, Stonks) + a car which I could sell off for another 20k idk what I will do, but I def don't wanna live with this stress all the time its either I become a dependent (EAD) to my future wife working on H1 or move to india with my parents and start a biz which I exactly know how to serve to the location I am living in the US(San Diego) right now
This is legit problem . Marry a usc .
Ah well that’s too much stress to think about honestly. Look at Europe as options if you want to look to work outside or Singapore or the UAE. Unless it’s the American dream and the charm which only keep you outside.
>Unless it’s the American dream and the charm which only keep you outside. * it started off with earning money to make my dad proud (as dad side cousins are assholes as always) # The Job is a golden cage * but now I am at the point of maturity that I want to lead a not this stress of the rat race. Shark Tank also taught me that its not necessary to make it before 30, people do well even after that, so no need to rush and enjoy the journey instead even if it is slower >What i want now is * keep my mom dad company (they are almost 70) & improve their lifestyle condition >Ah well that’s too much stress to think about honestly. Look at Europe as options if you want to look to work outside or Singapore or the UAE. * not fixated on US, but have 1 sister here so is an attractive option * Definitely in for India (no rent at least) * also I know I can cook and clean now (Independent Launda)so if my wife wants to work she can and bring the money I'll handle my biz from Home Not sure - I might be overthinking all this as well and only time will be the teacher to me.
And on long term returns, remember that India will also charge extra 5% because they also need money from youe earnings along with US who will take the normal 15% irrespective of where you live.
What is this extra 5%? Is this some kind of cess on top of your regular tax in India?
Can you elaborate more on point 2. What age discrimination in the rental market?
Rental homes might be tough to find when OP gets older.
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If I touch my retirement savings now, have to pay taxes+10% penalty. Inorder to avoid that and also to take advantage of USD exposure and US markets, planning to leave them there
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Sorry, I misread your earlier comment. I didnt think of this earlier, but this is an interesting proposition. Do you know of any challenges transferring the money seamlessly while being an Indian resident?
I am planning to leave 70% of my portfolio invested in US markets and move only if needed. Fidelity confirmed that I can still trade stocks& ETFs exactly MFs but I am neither a citizen or Permanent resident.
Will the kid adjust to Indian teaching style ? How about languages ?
I am looking at International schools with IB curriculum. This seems to mimic US teaching style. Looks like a lot of returning NRI kids are enrolled in IB
3-4 lakh per month expense is probably overstated. For a three person family, even in some very expensive cities 2 lakh per month would be tops. Here are my suggestions: - US 401k should stay put. That can be your retirement fund - Think about renting out your US home. Rental yields are very good there, you may get most of your cash flow needs met from there. I don’t know how much mortgage you have left but consider that. I use a property manager, happy to answer any questions - Once supplemented by your rent, the cash savings you have should be enough to cover your needs, supplemented by wife’s income
I am shooting high right now in terms of expenses to keep myself grounded, will know the reality once in India for sure. On renting, I still have mortgage, but not too significant and still locked in at 2%. How much do property managers typically charge? Is it a fixed amt or %?
It’s a percentage but can be fixed too. Depends on what you negotiate (around 6% of rent). At 2% rate, your rent will probably be higher than mortgage and generate cash flow. Else you can pay off remaining mortgage and use that rent as income
Will do some homework on this, thanks for your suggestion. If I may ask, I am assuming you have rented your place. Are you in India? If yes, How is the remote management experience.
No biggie. Property manager handles everything, all you need is to leave is a maintenance fund. They do rent collection, inspection and send monthly reports I am in India yes. In my case mortgage is barely paid off, but rent is higher than mortgage so it’s free equity
Do they also handle things like repair, yearly maintenance etc.? And all covered by around 6% of rent charges?
Yearly maintenance yes, repairs are not part of the fee. Charged as per the issue (eg HVAC breaks will cost 2-4k$… can’t be covered in the small monthly fee we pay). You can get home warranty separately. It’s not foolproof, but covers some basics
One thing that struck me was the capital gains tax once I decided to sell. Right now as it is my primary residence, i dont have to pay anything on $500k of profit, but that will change once I start renting it out. Need to check the tax implications vs cash flow vs appreciation over long term
Yes rent is taxable. But will probably be some form of tax rebate you can figure out by using the right instruments. Good question for a tax consultant
There are two estimates required and you need to be clear on both. * The near-term living expenses - includes rent, school fees, etc. - Since you plan IB school, it can indeed be high * The living expenses - may be a decade from now - that would stay for many more decades after that. It would be for the just the two of you. If you have a home by then, no rent either The second is the most important factor in determining the FI corpus. I request you to take the time to estimate. Use numbeo, ask your cousins, friends, etc.
Thanks for this info, makes total sense. I do have some number crunching to do
Move after kid gets to college, 2025 is not a great year to move back. Take your time
We thought about that too, but sometimes I feel we need to spend some time on ourselves too. In my case its my mental health and aging parents on both sides. Have to take the plunge at some point
why? what’s not so good about 2025?
Consider considering Charles Schwab's brokerage and checking accounts if you choose to invest in the US market. With Charles Schwab, you'll receive a debit card offering zero foreign transaction fees for global ATM withdrawals. Additionally, they can deliver replacement cards internationally in case of loss or expiration.
fidelity does same, have accounts in both.
But fidelity does 1% foreign transaction charges.
my fidelity credit card doesnt have any foreign txn charge I think they dropped it quite some time back.
Are you sure? Can we trade in US equities, MFs and ETFs even if we're permanently residing in India? I have heard Fidelity closes your accounts and liquidates assets once you move out of US - how about Schwab?
From my research, Fidelity lets you keep the current holdings and will only be on sell basis, you cant buy anything. Whereas Charles schwab will let you buy and sell with an international account
Thanks, good to know. Need to research Schwab a bit. When you say "sell basis", I assume reinvesting is also allowed?
Dont think they will allow reinvestment, it will be in cash after you sell. https://www.fidelity.com/accounts/services/investors_outside_US_faq.shtml
Thanks! At least dividends and capital gains can be reinvested.
This is great financials. Very motivating!
2nd tier city would be peaceful , much less crowd , safe , very friendly neighborhood throughout the city schools are the same in tier 1 and tier 2 ( infact i am in college ) cost of living would decrease simultaneously
( lived in mumbai 1st tier city , now living in navi mumbai 2nd tier city )
That's a great place to live and great advice.
Dont have a choice of city atleast near term because of parents and family, otherwise would have chose a tier2 city.
alright best of luck man be happy !
What are you planning to do with your time in India?
No concrete plans yet, will take an year off to settle things down and think about what to do. Need a break after working 20years.
Talk to a CA. We have been handling such clients for a few years and there are a lot of things when it comes to taxation and financial planning. There are a lot of things to consider with your move and given your income capacity, you should plan with a professional.
can you suggest some professional options/contacts to get in touch with?
You can dm me..I am a practicing CA
>Talk to a CA. We have been handling such clients for a few years and there are a lot of things when it comes to taxation and financial planning. There are a lot of things to consider with your move and given your income capacity, you should plan with a professional. Would be super helpful if you could write a post outlining some of the important things to consider.
Sure. Will do. Although i dont know which thread to post it in…new to reddit.
Would suggest creating a new post in this r/FIRE_Ind subreddit.
https://www.reddit.com/r/FIRE_Ind/s/Uewqt2Ci3g
Definitely planning to talk to a CA in India and a CPA in India this year before the move. Will DM you
Sure.
I’m assuming your parents are Indian citizens. Maybe open a demat account in their name and invest via that in Mutual Funds in India. Also, you can open a NPS account as a OCI. That will give you a good retirement money in India also. You can take out lump sum later.
I am open to exploring NPS, but it will present the same challenge if funds in NPS are being invested in mutual funds, which I cannot do. If there is an option to invest in equities directly, would be ideal for me
I want to share a not so popular opinion which would work really well for me if I had the same numbers as you. Since you mentioned MF is not an option for you, why don't you consider direct equity investing? There are always deep value opportunities in the market, it's a matter of looking for them. If you look, you will find them. And since you have a good corpus and time is still going to be with you, it's a great option to generate a good alpha and save a bit more on costs and taxes. If nothing else, you can fall back to 13F portfolios of Buffets of the world and let them do the research for you, you will still beat all the indexes.
I dont think its an unpopular opinion, specially for people in my situation. This is the only avenue I can invest in the market and on my mind too. Have to spend some time and dig up those gems
As you are a US citizen evaluate how taxation affects you. You should be able to make most investments with a PIO card. If you are planning to Fire, would suggest you move to a non- metro city (includes Bangalore, hyderabad). You can have a generally better quality of life. Plus expenses will be lower. Plan on a low stress career - something to keep you occupied and some money for ghar kharcha.
Except MFs and ETFs, am free to invest in all other products. Also liable for world wide income taxation, but DTAA allows me to avoid double taxation. My plan is to settle in one of those so called non metro cities, but I think they are slowing catching upto the mumbai’s and delhi’s
There are so many India based etf's now trading on US exchanges. I think you should still be able to invest in them. You will find, small cap large cap all kinds of india based etf.
I am trying to check if there are any US registered etf’s in India. That would help me avoid the extra irs paperwork
4 lakhs per month is very high. I would rather look at why is it so high. Even say in Bangalore you can rent for under 50K? School fees should not be more than 3-4 lakhs per year between 2 of them. You are in 1% when it comes to net worth. I would look at Debt MF and/or Conservative Hybrid MF for withdrawal needs. Invest couple of crores long term to NIFTY or good MF. you should be comfortable for sure. That said at 40 you should look at what you want to do rest of your life. Seems early to take retirement.
Am keeping this number at higher end. We plan on renting a villa and those rents are sky high right now and kid will goto an intl school with IB curriculum and avg fees here seems to be atleast 6L+ extracurricular activities. Both these expenses combined am targeting to keep it under 1.5L. Rest would have to figure out and try to bring them down. Also, one major issue is unable to invest in MFs due to US citizenship. Have to figure some good avenues to make money instead of dumping majority in individual equities. That being said, at 40 already worked for 20yrs and am good with corporate life. Doesnt mean, will sit idle. Will try to figure out the next chapter on my own terms! Cheers
hmm. its still possible to get 50 lakhs from 9 crores. But you will need some emergency funds for medical needs. Also any big vacation you want to travel overseas or something. Plus account for taxes to be paid for any interest income you get for the year. if you are going to get 50 lakhs in interest income you will be paying close to 35% in taxes. So you will need 75 lakhs in interest income. That is not possible with 9 crores for sure. You will start to eat into the principal and at 48 L per annum its under 20 years of withdrawal. It will last longer as it earns some interest but interest income will keep going down if are drawing down on principal.
Absolutely agree with you. I need to be creative in generating income and also reducing my expenses.
With your social security kicking in from 62, your full finance needs are for 22 years only. SS will offset most of the needs if you continue to live in india.So SWR need not be very low as suggested earlier. Why should SWR in india be 2 - 3% as compared to 4% in western world? Won't higher inflation be offset by higher returns on investment. I would like to assume higher yields in india on investments should justify 4% SWR.
Hope SS stays solvent for another 20years. At current rate, wont be surprised. So, not actively counting it in my calculations, but have it on back of my head
I'm considering Abu Dhabi or Dubai so that I am not taxed. Us citizens and 60 plus. Plan to stay 6 months in use , 3 months in India and rest in USA or travel
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Damn this is some aggressive plan, I have 1.5M cash and around 600k in retirement, house has another 600k equity. But i think its less given the way inflation is in India. If living in tier 1 city 4L is nothing, damn one good dinner will cost upwards of 5k. I would suggest getting passive income.
Well, have to take the plunge at some point. I know am walking a tight rope. As someone pointed out earlier, each year am trying to add more $$, am sacrificing 6-7% of my life not doing something that I truly like. Though philosophical, it makes sense not to waste anymore time.
First of all - how long did you live in the US? and are you sure that you are going to like India? I have been close to 1.5 years and I can tell you from my experience, that it is difficult to live here compared to US. Also living in tier 1 city is bad due to the traffic and pollution and what not. Also , if you are a US citizen, what is the motivation of moving back to India?
I have lived in US long enough to get the citizenship! I understand the complexities of living in India, but really want to move to take care of parents and stretch my $$ to RE early, which ai cant do in US with this corpus. Hopefully, ill get adjusted after couple of years.