How Sahil plans to achieve financial independence by efficient tracking

Published: April 27, 2023 at 6:00 am

Hi, this is Sahil. This is the way I track my personal finance-related metrics. This should be helpful for DIY investors and should help them to focus on what and how to measure.  

About this series: I am grateful to readers for sharing intimate details about their financial lives for the benefit of readers. Some of the previous editions are linked at the bottom of this article. You can also access the full reader story archive.

Opinions published in reader stories need not represent the views of freefincal or its editors. We must appreciate multiple solutions to the money management puzzle and empathise with diverse views. Articles are typically not checked for grammar unless necessary to convey the right meaning to preserve the tone and emotions of the writers.

If you would like to contribute to the DIY community in this manner, send your audits to freefincal AT Gmail dot com. They can be published anonymously if you so desire.

Please note: We welcome such articles from young earners who have just started investing. See, for example, this piece by a 29-year-old: How I track financial goals without worrying about returns.

Join over 32,000 readers and get free money management solutions delivered to your inbox! Subscribe to get posts via email!
🔥Enjoy massive discounts on our robo-advisory tool & courses! 🔥

Now over to Sahil. It is quite rate to see someone track their portfolio as meticulously as Sahil does.

How much do you earn, spend and invest?

1. Firstly, every person should know what they earn (post-tax) every month and the monthly salary growth rate. Secondly, how are you spending and/or investing from the salary? Salary can either be 1) Spent on expenses 2) Paid off an EMI, and/or 3) Saved/Invested. Here’s how I track these.

  • I am using a dated graph as I don’t want to share the latest numbers.
  • The black line shows my 12-month moving average post-tax earning for any respective month (scale on the vertical right axis, redacted to ensure privacy). My salary has grown decently in the last 4-5 years and can be seen here. I take 12 months rolling/moving average to smoothen any spikes.
  • The blue portion is the % of earnings that go to investments, red portion is % of earnings gone to EMI payments and the yellow is % spent. Again 12-month moving average. From Apr’17-Mar’18, (See the first bar graph) I spent ~25% on investments, ~60% on EMIs and the remaining ~15% on expenses. Now, given EMIs are over, I can save/invest more than I spend.
  • Ideally one should expect continued growth in the black line, an increase in the blue bar height meaning you are saving a bigger chunk of your salary, and thirdly, <35% spent on expenses.
Tracking earning and spending
Tracking earning and spending

2. In extension to the above, I also track the 3-year CAGR for your moving/rolling average salary, expenses, and investments. It gives you further evidence of how you are doing both earning and spending-wise. An increase in the height of the yellow bar as above might indicate that you have a lifestyle creep and your expenses CAGR is higher than your salary CAGR. This happened with me in FY22, primarily due to one-time events. My expenses CAGR is back to being lower than my salary CAGR in FY23.

  • 3-year rolling Salary CAGR (FY23): X% (redacted for privacy)
  • 3-year rolling Savings CAGR (FY23): X%+13%
  • 3-year rolling Expenses CAGR (FY23): X%-15%

3. I also started tracking expenses in various buckets. But it is too tedious and doesn’t seem to give many insights. I think whenever I’m closer to my FIRE, I’ll start tracking this again to pinpoint expenses during FIRE better.

Asset Allocation and Where to Invest?

Next part- Asset Allocation or where do I save or invest? I don’t maintain a separate emergency fund and have a unified portfolio. It is easier for me to calibrate and measure. I added REIT and Gold (SGB) last year, so not sure where I will take it. REIT taxation changes have made it more complicated. Overall, my target is to reach 50-55% in equity, 10-15% in REIT and 30-40% in Debt. Once I reach ~50% in equity, I’ll decide if I want to change my target asset allocation. My asset allocation as of today is as follows:

  • Savings and FD:~10%
  • Debt MFs: ~20%
  • Debt Illiquid (PPF + EPF + NPS-C/G): ~30%
  • Equity (MFs+ Stocks+ NPS-E):~36%
  • Gold (SGB): ~4%
  • REIT: ~5%

2. Here is a bit more information on the instruments used:

  • Debt MFs are a mix of short-term (liquid/arbitrage/UST/Savings) and some medium-term/TMF Debt MFs. Short-term Debt MFs double up as emergency funds and rebalancing/ switching to equity, while medium-term/TMF were for locking the yields at the end of FY23. Given the change in tax structure in Debt MFs. I will likely rethink before adding more to it in FY24. 
  • I ensure that the illiquid part of the portfolio, i.e. EPF, PPF, NPS, doesn’t become too large (>30-35%) because what use is the money if we can’t take it out during times of need? This used to be higher earlier and is going down now.
  • I have NPS Tier-1. Currently, NPS is at 75% equity, and I intend to maintain it until I hit my target equity allocation. After that, it would be a nice tool to move between equity and debt in NPS to change asset allocation without paying any taxes. 
  • The equity portfolio is majorly driven by MFs (80%+), NPS-E and some Indian direct equity.
    • The target amongst the equity portfolio is to have ~65% India and ~35% US weight. I’m at ~15% US weight currently. A mix of PPFAS flexi cap and Motilal S&P 500 makes up the US weight. Given the change in tax rules, I will again rethink this and stop new investments in S&P 500
    • Target in the India portfolio is to have ~10-15% small cap, ~20-25% mid cap and remaining large/giant cap. I track it through value research. I have a 5% small cap and a 25% mid cap, so broadly inline.
    • MFs- PPFAS Flexi cap, Motilal S&P 500, SBI small cap, One mid cap, Edelweiss Balanced advantage. Though I also have some N50 and NN50, I will not go fully passive.
    • Stocks: 10 stocks. Likes of ITC, HDFC Bank and a few new-age companies
    • Gold exposure via SGB and REIT exposure via three listed REITs

I measure the standard deviation and rolling returns of each equity MF as a basket. I try to remove MFs which are not beating the indices in either return or risk. 

  • Here’s the two rolling 12 months average return of my equity MF against N50 TRI and NN50 TRI for several months. Just for clarity and explanation on how to read the below table: My Equity MF portfolio gave a 29.3% return from Jan-Dec’21 against ~26.2% return for NN50 TRI.
Rolling 12-month return and standard deviation of portfolio with benchmarks
Rolling 12-month return and standard deviation of the portfolio with benchmarks

I have been able to beat the indices both in return and volatility in FY22 but in FY23 only in volatility. I am fine with this result as I am happy with ~10% lower risk than Nifty50. Mind you, this is tough and not attributed to me but to the performance of chosen MFs


  • Equity MF: ~13.0% (Since 2014, Major investment since 2018)
  • Debt MF: ~6.0% (Since 2017)
  • NPS: ~11.5% (Since 2019)
  • SGB: ~17% (Since 2020)
  • REITs: (~3%) (Since 2021)
  • PF: ~8%
  • PPF: ~7.5% (Since 2015)

Money saved: No FnO, No trading, No LIC endowment/ULIP plan

Net worth (NW) and its measurement

1. All this saving, investment, asset allocation and fund selection is fine, but how do you bring it together?

  • An example: NW on 1-Nov-21: 100; Nov-21 salary: 10 and expenses: 6; NW on 1-Dec-21: 105. Now, NW has increased by 5 units in 1 month; 4 units (80%) can be attributed to salary savings, and the remaining 1 unit (20%) can be attributed to asset increase.
  • In last 1 year, my NW has increased by 40%+ and about 90% growth came through salary savings and the remaining only 10% through asset returns (capital gain + interest etc.). As we become older, majority growth should come from asset returns. Do note, in a year of negative/zero equity returns like FY23, asset returns could be negative as well, which has happened with me twice. 
  • Overall, till date, ~87% of my net worth is from human capital (salary-expenses) and only ~13% if from financial/asset returns.

2. I’m at 5-10 times (I don’t want to share the exact number) of annual expenses wrt the FIRE goal. I want to reach 30-40x in the next ten years.

Reader stories published earlier:

As regular readers may know, we publish a personal financial audit each December – this is the 2020 edition: How my retirement portfolio performed in 2020. We asked regular readers to share how they review their investments and track financial goals.

These published audits have had a compounding effect on readers. If you would like to contribute to the DIY community in this manner, send your audits to freefincal AT Gmail. They could be published anonymously if you so desire.

Do share this article with your friends using the buttons below.

🔥Enjoy massive discounts on our courses, robo-advisory tool and exclusive investor circle! 🔥& join our community of 5000+ users!
Use our Robo-advisory Tool for a start-to-finish financial plan! More than 1,000 investors and advisors use this!
New Tool! => Track your mutual funds and stock investments with this Google Sheet!
Follow Freefincal on Google News
Follow Freefincal on Google News
Subscribe to the freefincal Youtube Channel. Subscribe button courtesy: Vecteezy.
Subscribe to the freefincal Youtube Channel.
Follow freefincal on WhatsApp Channel
Follow freefincal on WhatsApp
Podcast: Let's Get RICH With PATTU! Every single Indian CAN grow their wealth! 
Listen to the Lets Get Rich with Pattu Podcast
Listen to the Let's Get Rich with Pattu Podcast
You can watch podcast episodes on the OfSpin Media Friends YouTube Channel.
Lets Get RICH With PATTU podcast on YouTube
Let's Get RICH With PATTU podcast on YouTube.

  • Do you have a comment about the above article? Reach out to us on Twitter: @freefincal or @pattufreefincal
  • Have a question? Subscribe to our newsletter with the form below.
  • Hit 'reply' to any email from us! We do not offer personalized investment advice. We can write a detailed article without mentioning your name if you have a generic question.

Join over 32,000 readers and get free money management solutions delivered to your inbox! Subscribe to get posts via email!

Explore the site! Search among our 2000+ articles for information and insight!

About The Author

Pattabiraman editor freefincalDr. M. Pattabiraman(PhD) is the founder, managing editor and primary author of freefincal. He is an associate professor at the Indian Institute of Technology, Madras. He has over ten years of experience publishing news analysis, research and financial product development. Connect with him via Twitter, Linkedin, or YouTube. Pattabiraman has co-authored three print books: (1) You can be rich too with goal-based investing (CNBC TV18) for DIY investors. (2) Gamechanger for young earners. (3) Chinchu Gets a Superpower! for kids. He has also written seven other free e-books on various money management topics. He is a patron and co-founder of “Fee-only India,” an organisation promoting unbiased, commission-free investment advice.
Our flagship course! Learn to manage your portfolio like a pro to achieve your goals regardless of market conditions! More than 3,000 investors and advisors are part of our exclusive community! Get clarity on how to plan for your goals and achieve the necessary corpus no matter what the market condition is!! Watch the first lecture for free!  One-time payment! No recurring fees! Life-long access to videos! Reduce fear, uncertainty and doubt while investing! Learn how to plan for your goals before and after retirement with confidence.
Our new course!  Increase your income by getting people to pay for your skills! More than 700 salaried employees, entrepreneurs and financial advisors are part of our exclusive community! Learn how to get people to pay for your skills! Whether you are a professional or small business owner who wants more clients via online visibility or a salaried person wanting a side income or passive income, we will show you how to achieve this by showcasing your skills and building a community that trusts you and pays you! (watch 1st lecture for free). One-time payment! No recurring fees! Life-long access to videos!   
Our new book for kids: “Chinchu gets a superpower!” is now available!
Both boy and girl version covers of Chinchu gets a superpower
Both the boy and girl version covers of Chinchu gets a superpower.
Most investor problems can be traced to a lack of informed decision-making. We have all made bad decisions and money mistakes when we started earning and spent years undoing these mistakes. Why should our children go through the same pain? What is this book about? As parents, what would it be if we had to groom one ability in our children that is key not only to money management and investing but to any aspect of life? My answer: Sound Decision Making. So in this book, we meet Chinchu, who is about to turn 10. What he wants for his birthday and how his parents plan for it and teach him several key ideas of decision-making and money management is the narrative. What readers say!
Feedback from a young reader after reading Chinchu gets a Superpower (small version)
Feedback from a young reader after reading Chinchu gets a Superpower!
Must-read book even for adults! This is something that every parent should teach their kids right from their young age. The importance of money management and decision making based on their wants and needs. Very nicely written in simple terms. - Arun.
Buy the book: Chinchu gets a superpower for your child!
How to profit from content writing: Our new ebook is for those interested in getting side income via content writing. It is available at a 50% discount for Rs. 500 only!
Want to check if the market is overvalued or undervalued? Use our market valuation tool (it will work with any index!), or get the Tactical Buy/Sell timing tool!
We publish monthly mutual fund screeners and momentum, low-volatility stock screeners.
About freefincal & it's content policy. Freefincal is a News Media Organization dedicated to providing original analysis, reports, reviews and insights on mutual funds, stocks, investing, retirement and personal finance developments. We do so without conflict of interest and bias. Follow us on Google News. Freefincal serves more than three million readers a year (5 million page views) with articles based only on factual information and detailed analysis by its authors. All statements made will be verified with credible and knowledgeable sources before publication. Freefincal does not publish paid articles, promotions, PR, satire or opinions without data. All opinions will be inferences backed by verifiable, reproducible evidence/data. Contact information: letters {at} freefincal {dot} com (sponsored posts or paid collaborations will not be entertained)
Connect with us on social media
Our publications

You Can Be Rich Too with Goal-Based Investing

You can be rich too with goal based investingPublished by CNBC TV18, this book is meant to help you ask the right questions and seek the correct answers, and since it comes with nine online calculators, you can also create custom solutions for your lifestyle! Get it now.
Gamechanger: Forget Startups, Join Corporate & Still Live the Rich Life You Want Gamechanger: Forget Start-ups, Join Corporate and Still Live the Rich Life you wantThis book is meant for young earners to get their basics right from day one! It will also help you travel to exotic places at a low cost! Get it or gift it to a young earner.

Your Ultimate Guide to Travel

Travel-Training-Kit-Cover-new This is an in-depth dive analysis into vacation planning, finding cheap flights, budget accommodation, what to do when travelling, and how travelling slowly is better financially and psychologically, with links to the web pages and hand-holding at every step. Get the pdf for Rs 300 (instant download)