Sunday, October 04, 2009

How much money do you need to Return to India (R2I)?

Many of us decide to go to US to earn money. However, after being in US for a few years, we find it difficult to decide "How much money is enough to settle in India?". Yes! the cost of living in India has gone up significantly in the last decade.  So, you may be wondering "How much money should I have to Return to India (R2I)?" The right answer is "It depends".

I've made an attempt to capture the cost of living in Chennai (as of 2009). The expenses have of course, sky rocketed. Given below are the approximate expenses for a 5 members family (Husband, wife, kid, grand parents), leading a comfortable (but, not luxurious) life.

Settling costs (Rs. 60 Lakhs - Rs. 1.15 Crore)

Own House         - Rs. 50 lakhs - 1 crore 
                    (depending upon the location. These days, you can find great deals on real estates and rental properties in online websites such as Magic Bricks & MyDeals India)
Car               - Rs. 7 - 13 lakhs
Furnishing        - Rs. 3 lakh 

                    (bed, TV, refrigerator, A/C etc.,)

Monthly Expenses (~ Rs.27K per month)

Groceries                - Rs.8K
Vegetables/Fruits        - Rs.3K
Electricity              - Rs.1K
Gas Cylinders            - Rs.1K
Petrol/Diesel            - Rs.2K
Doctor Visits/Medicine   - Rs.1K
TV/Phone/Mobile/Internet - Rs.3K
Dining out               - Rs.3K
Recreation/Entertainment - Rs.3K
Wedding/Other Gifts/Toys - Rs.2K
Yearly Expenses (~ Rs. 80K per year)

Dresses for the family   - Rs.20K
Travel/Sightseeing       - Rs.25K
School expenses          - Rs.35K - 50K, per kid


- The above expenses do not include insurance payments, service/maintenance of items (car, A/C, refrigerator, washer etc.,). I'll update them when I get more details.
- In case you've decided to rent a house - renting a 3BHK house costs anywhere from 15K - 25K depending on the locality/facilities etc.,
- Some schools charge up to Rs.1 Lakh donation during the initial admission (Also read: Getting KG admission for a kid in school - the math behind it)

The money that you may need to settle in India is very subjective. It depends on your family size, life style, spending pattern, city in which you want to live etc., If you have spent 6 - 10 years in US and invested your savings wisely, you should be able to settle in India, very comfortably. At the end of the day, there is no end to the need for more money.

Related posts:

R2I Checklist
R2I - List of things to pack/bring from US
US to India Money Transfer Strategies
Cost to Company (CTC) - Peeling the Onion