Sunday, October 4, 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


  1. Planning to R2I in early 2009. I find your site extremely useful. This particular post was the most useful. I was trying to get a feel for what my monthly expenses would be and this gives me a good starting point. Thanks a lot!

  2. Hello , thanks for this information . Very useful and makes anyone to think logically. It puts down the facts very nicely

  3. Dude, Too informative post... Thanks a lot...

  4. Saro
    Your articles are all informative and helpful.
    I have been a follower of R2I forums for 2 years now but your blog is one of best informative one.
    I am hoping to R2I in 1 year...(hopefully I will succeed).

  5. Saro, nice blog you have here. One comment on the expenses, when a pant is Rs.2k and a normal saree Rs.5k, how will Rs.20k be sufficient for Dresses for the family per year? And even if you buy one silk saree and one special wear dress for the kids, this is much more than the budget isn't it?

  6. Please treat these numbers as guidelines. It may vary based on your life style, spending pattern, and interests. (My estimates were based on twice a year shopping of dresses for my family. We don't exceed the 20K limit :))

  7. Hi Saro,
    Your blog is excellent and useful for others.
    Thanks very much.

  8. Hello, this blog helps not only the R2Is, but their family in India also.
    So, oru 'kal'lula (stone), rendu maangaai':).

    If you are a tamilian, you can understand the proverb, else, refer to your friend who is a tamilian.
    A very useful & informative blog.
    My heartfelt blessings to you & your family.

    A well wisher.

  9. We moved to America to be with our daughter's family and grandchildren. It is interesting for me (my husband passed away in America) to keep up with how things are changing in India. I look at shopping websites to get costs of things so that I can send a few money-gifts to relatives before festival times. Thanks for your various posts.

  10. Great ! That is a nice way of keeping track of costs in India.

    I'm glad that you found the website useful.

  11. Hi Saro,

    nice post...if possible can you update the expense lsit with todays market trend...i'm pretty sure lot changed since your posting.

  12. Sure ! I'll do it. In the mean time, you can safely add 10 - 20% to the numbers given here :)

  13. Nice Job ! informative blog !!

  14. I am settled in Bangalore. And this place is almost similar to Chennai's living cost. Both me and my husband work in a Software company and again our's is a 5 member house and we lead a comfortable living, but not a luxury life. Our estimate is almost matching with the one you made. Except that in India, generally everybody keeps a maid to clean the house and that cost is about 1500-2000 Rs. Also, in India, most of us live with parents, who of course are dependents, then their medical expenses is about min. 2500-3000 per month.

  15. I live in Bangalore, that is almost similar to Chennai's living cost. We both work in a S/w company, and we lead a comfortable life, but not a luxury life. Again, our's is a 5 member family. In such case, there are two more things which we could add to the list and its part of one's living style, A maid to help us clean the house - 1500-2000Rs in case of a 3 bedroom house. Also, since parents are dependent's their monthly medical expense comes to min. 2500-3000 buying basic BP, Diabetese and Calcium tablets.

  16. I agree with you Deepa ! Good input.

  17. Brother, I was thinking how much should I save for settling in India, now working in gulf, the informations what you have produced just what was in my mind (Should be same cost is same for all). Very good information exactly the same what i thought. But in this what is missing is futre savings for Kids College education, Kids marriage....We should also have to save for these calculation with 2 kids came to 125 lakhs.
    Monthly expenditure is 40000 rupees.

  18. Yes! 40K expense per month is reasonable for an above average or luxury life style with 2 kids.

    Parents spend about Rs.5 or 6 lacs these days to get admission into good engineering colleges. They spend about 1 lac a year of education for fees, travel & other expenses.

  19. Brother, Can you please also write similar one for approx. expenses in US after migration for potential aspires?

  20. Brother, Can you please also write similar one for approx. expenses in US after migration for potential aspires?

  21. Hi Saro,

    Great job. Can you also please create a similar one for an approximate expenses one might have to after moving to US? May be another article!


  22. Sure. I'll prepare one for the US expenses too.


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