AMA - personal finance

Unfortunately real estate investment is not easy. Depending on the area plots of lands could be subject to risks of squatters occupying and refusing to move. So you will need to invest in the right place and also get help of a property management agency. On the other hand buying a house that generates rent is a way to diversify cash flow. I don’t like the illiquidity of real estate so have stayed away from it. Only off late considered getting a house that’s also primarily for me to live there vs think of it as an investment.

What do you think is the right age and time to do real estate investment?

There’s no magic response here. It’s a function of age, financial needs and risk appetite. If you are younger(<50), have a good exposure to equity as an asset class. The split I have is 50% large cap, 25-30% small cap, 15-20% mid cap. For large cap - index funds / ETFs are good ideas - UTI nifty 50 index fund, Nifty bees are good options. The reason to prefer index funds for large caps is that index beats the performance of over 70%+ of actively managed funds. So rather than optimise for the fund, pick the index and stay invested for many years. For small and mid cap there’s still scope to pick active funds. Keep emergency funds across a few liquid funds - you will get upto 50k instantly per fund on redemption and will earn better returns than savings account.

Emergency fund is a short term thing to build. Better to allocate higher % of savings towards emergency funds in the first few months till you hit your target. But don’t make it 0 in the others - better to start the long term journey early