In a chat with Get Ahead readers on August 31, financial planning expert Vetapalem Sridhar answered these and several other queries related to financial planning for you and your family.

For those of you who missed the chat, here is the transcript.

Part II: How to become a crorepati using your savings

prashanth asked, I am a salaried employee... what wud be benificial for me to invest money.. in mutual fund?? which mutual fund is good in the market now?

Sridhar answers, See it is very difficult to predict which MFs will be the best performers in future. Wat u should look at is to pick a diversified equity MF with a long term horizon (say 5-7 yrs) to make gud returns. Some of the better fund houses r HDFC [Get Quote], ICICI [Get Quote], Templeton and SBI [Get Quote].

jacqueline asked, Good Afternoon sir, i am 34 years, unmarried, ten years of service. As of now my friends are insisting on me purchasing real estate. My take home salary as of now is Rs 12,000. I have no other loan. I have to cough up Rs 3 lakhs (cash and another 13 lakhs by loan. My tenure of service could well be for another 5 years (keeping in mind privatisation). The Rs 3 lakhs of cash is all of my 10 years PF and other savings. The other priority being marriage should i go in for investing in house property (considering the subsidy it offers for tax benefit.) kindly advise. Thanks in advance.

Sridhar answers, See ur annual salary is Rs 1.44L. So the tax liability will be minimal. It would be more advisable to invest into equity MFs with a long term horizon for ur case.

shipa asked, hello, am 24 working as a software engineer. my take home is Rs 14,000 and i have just started working. i want to buy a flat in the next one year. can you provide me some financial assistance?

Sridhar answers, Dear Shilpa for this u will have to approach a bank.

praveen asked, Hi my takehome salary is Rs 16,500 after my personal amount of Rs 3,375 . As of now i have only taken LIC [Get Quote], SBI Magnum Tax gain. So do you advise me to invest in further? I am planning to start SIP for HDFC equity fund and Reliance [Get Quote] Vision Fund of amount Rs 1,000 each month. So is it good? What else should i go for with my present salary?

Sridhar answers, Dear Praveen, I think u already have enough on ur hand now. It is definitely a gud idea to start a SIP in MFs. The funds mentioned by u r gud. Stick to ur current investments with a long term horizon to create wealth.

Aman asked, Hi, I have a land in Bangalore. I want to sell it and thinking to buy a flat in Pune to get tax savings etc. But pune has become very expensive. Do you think I should wait for some more time or selling land is a good idea? It has appreciated by 2 times in 3 years.

Sridhar answers, Dear Aman, I want to ask u a Q - wat is ur objective, saving tax or creating wealth? If it is creating wealth u will need to find out that inspite of investing in a expensive property in Pune would it help u make a better deal by saving on tax. The risk of property prices going high is already less in ur case as u r converting land into a flat. The only thing that u need to do is that the gap betn buying and selling should be minimal.

michael asked, Hello Sridhar, I want to retire early after 4 yrs at age 50 from my overseas employment. I have been investing all my savings for the past 20 yrs in stocks/funds which are now worth over Rs 1 crore. As there are no debt instruments, could you please advice the right portfolio I must hold now on long term basis for managing my wealth? I will need at least Rs 25K as monthly income on my retirement and also sufficient money in equity for growth.

Sridhar answers, Dear Michael, If the data provided is true, then I think u can retire today itself. Ur annual need is Rs 3L. If u have a portfolio of Rs 1 Cr, u just need to make around 3% in the first yr. Even if we assume a cost of living rising by 7% p.a. and u withdraw more each yr accordingly, u can retire today itself. To smoothen out ur withdrawals, the next 5 yrs money to be consumed should be put into safer (debt) instruments. the remaining can remain in good quality equity. As each yr goes by, convert part equity to debt so that u always have 5 yrs worth money to be consumed in safer investment avenues.

sridevi asked, Hello Mr Sridhar, I have a daughter who is 10 months old; I mainly want to save for her higher studies. We can save upto Rs 5,000 a month. Can you please let me know how and where to invest this to get good returns?

Sridhar answers, Dear Sridevi [Images], I have written a comprehensive article on investing for children's future. Plz go thro it. http://specials.rediff.com/getahead/2007/aug/07sli1.htm. This is a slide show, so click NEXT to read thro.

jaya asked, hello sir my yearly package is Rs 1,90,000 n my yearly ex is Rs 48,000. So plz suggest me how can i invest in mutual funds?

Sridhar answers, Dear Jaya, U seem to be doing real gud. U r saving almost 75% of ur earnings. Of the money u save first identify which part of this saving u will not need for the next 5 yrs or more. This is the money that should definitely go towards equity-oriented MFs. U can contact any MF agent or ur Banker to help u with investing in MFs.

Sanjay asked, Hi, We are a working couple with Rs 5,00,000 earnings per month and have 2 kids age 6 & 3 and wish to buy a piece of land around Delhi which will cost us Rs 30 Lacs. We have saved some amount by way of jewellery etc.. which will be about Rs 8 lacs and have to sell off this to make the down payment and rest all would be on loan. Do you think it is a wise decision to make an investment in this manner?