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Ramalingam

Ramalingam Kalirajan  |7159 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 30, 2024

Ramalingam Kalirajan has over 23 years of experience in mutual funds and financial planning.
He has an MBA in finance from the University of Madras and is a certified financial planner.
He is the director and chief financial planner at Holistic Investment, a Chennai-based firm that offers financial planning and wealth management advice.... more
Rohan Question by Rohan on Jan 25, 2024Hindi
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Hi I am 22 Years Old and My Salary is 27k Monthly .I am Investing 12k per month 4k in Small cap , 4.5 k in flexi cap and 3.5 k in index sensex fund. Please suggest if I need any changes

Ans: It's impressive to see your commitment to investing at such a young age! Your allocation across small-cap, flexi-cap, and index funds reflects a balanced approach to wealth accumulation. However, as life evolves, so should your investment strategy. Consider periodically reviewing your portfolio to ensure it aligns with your goals, risk tolerance, and market conditions. Consulting a Certified Financial Planner can provide valuable insights and guidance to optimize your investments for long-term growth and financial security. Remember, investing is a journey, and adapting along the way is key to achieving your financial aspirations.
DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.
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Ramalingam

Ramalingam Kalirajan  |7159 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 18, 2024

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Am 34 yr old, I hav 60k income monthly & EPF 4k monthly. Am investing in PPF 2k, maxlife insurance Savings plan - 5k, UTI flexi cap fund - 2k, SBI contra- 0.5k & nippan India small cap- 0.5k since from year. Pls suggest any changes are required or else can i continue
Ans: You are on the right track by investing regularly and diversifying your portfolio. Your disciplined approach to saving and investing is commendable. Let’s assess your current investments and suggest any necessary changes.

Evaluating Your Current Investments
PPF Contribution: Investing ?2,000 monthly in PPF is a good choice for stable, tax-free returns. PPF is a safe investment with government backing.

EPF Contribution: Your EPF contribution of ?4,000 per month is a secure and tax-efficient way to build a retirement corpus.

Max Life Insurance Savings Plan: The ?5,000 investment in a savings plan combines insurance and savings. However, the returns on such plans are often lower compared to pure investment products. Ensure you have adequate life cover through term insurance.

UTI Flexi Cap Fund: Investing ?2,000 in a flexi cap fund offers good diversification across large, mid, and small-cap stocks, providing a balanced risk-reward ratio.

SBI Contra Fund: The ?500 investment in a contra fund can be beneficial as it follows a contrarian investment strategy, buying stocks that are currently out of favour but have growth potential.

Nippon India Small Cap Fund: Small cap funds, though risky, can offer high returns over the long term. Your ?500 investment here adds to your growth potential.

Suggested Changes for Optimal Growth
Review Insurance Plan: Consider whether the Max Life Savings Plan meets your financial goals. Pure term insurance combined with higher returns from mutual funds might be more efficient. Term plans offer high coverage at a lower premium.

Increase SIP in Diversified Funds: You might consider increasing your SIP amount in diversified funds like the UTI Flexi Cap Fund. This fund balances risk and return by investing across different market capitalisations.

Balanced Asset Allocation: Ensure your portfolio has a good mix of equity and debt. You may consider investing in a balanced or hybrid fund, which provides exposure to both equities and debt, offering growth with reduced risk.

Regular Monitoring: Review your portfolio periodically to ensure it aligns with your financial goals. Market conditions and personal circumstances can change, necessitating adjustments.

Emergency Fund: Ensure you have an emergency fund covering 6-12 months of expenses. This fund should be easily accessible and can be kept in a savings account or liquid fund.

Additional Recommendations
Health Insurance: Ensure you have adequate health insurance coverage. This protects your savings from unforeseen medical expenses.

Retirement Planning: Given your age, consider long-term retirement planning. Increase contributions to retirement-specific investments like PPF and EPF. You could also look at the National Pension System (NPS) for additional retirement savings.

Tax Planning: Maximise your tax-saving investments under Section 80C and other relevant sections. This optimises your tax liabilities and increases your disposable income.

Final Thoughts
Your current investment strategy shows a good start, but a few adjustments can optimise your portfolio for better returns and reduced risk. Consider reviewing your insurance plans, increasing SIPs in diversified funds, and maintaining a balanced asset allocation. Regularly monitor your investments and seek professional advice to stay on track with your financial goals. Your disciplined approach will help you achieve financial stability and growth.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |7159 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Aug 08, 2024

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I am 53 years old and my name is loganathan.my earnings per month rs.25000. I have invested 20% of salary in mutual funds. Large cap 10%, small cap rs.10%,flexi cap 10% and remaining liquity funds. Is it right way or need any changes sir.
Ans: Loganathan, you are 53 years old and earn Rs. 25,000 per month. You invest 20% of your salary in mutual funds. Your current allocation is as follows:
• Large Cap: 10%
• Small Cap: 10%
• Flexi Cap: 10%
• Liquidity Funds: Remaining
Your dedication to investing is commendable. Let's review and suggest improvements.
Large Cap Mutual Funds
Benefits
• Lower risk compared to small cap funds
• Stability due to investment in established companies
Recommendation
• Keep your large cap allocation.
• Ensure the fund has a strong track record.
Small Cap Mutual Funds
Benefits
• High growth potential
• Higher returns over the long term
Risks
• Higher volatility
• Greater risk compared to large cap funds
Recommendation
• Continue with small cap investments.
• Ensure it aligns with your risk tolerance.
Flexi Cap Mutual Funds
Benefits
• Flexibility to invest across market caps
• Diversification within a single fund
Recommendation
• Flexi cap funds are a good choice.
• They provide balance and flexibility.
Liquidity Funds
Benefits
• Low risk and high liquidity
• Ideal for emergency funds
Recommendation
• Maintain liquidity funds for emergencies.
• Ensure easy access to these funds.
Suggested Changes
Balanced Portfolio
• Consider reallocating your investments.
• Balance between risk and stability.
Increase Large Cap Allocation
• Large cap funds offer stability.
• Consider increasing allocation to 20-25%.
Adjust Small Cap Allocation
• Small caps are riskier.
• Reduce allocation to 5-10%.
Maintain Flexi Cap Allocation
• Flexi caps offer flexibility.
• Maintain current 10% allocation.
Increase Liquidity Fund Allocation
• Ensure sufficient liquidity.
• Increase allocation to 20-30%.
Additional Considerations
Diversification
• Diversify across different asset classes.
• Reduces overall portfolio risk.
Professional Guidance
• Consult a Certified Financial Planner.
• Tailored advice based on your goals.
Regular Review
• Review your portfolio regularly.
• Adjust based on market conditions and life changes.
Long-Term Focus
• Focus on long-term growth.
• Avoid short-term market fluctuations.
Retirement Planning
Importance
• Retirement planning is crucial at your age.
• Ensure you have enough savings for retirement.
Pension Funds
• Consider investing in pension funds.
• Provides regular income post-retirement.
Health Insurance
• Ensure you have adequate health insurance.
• Covers medical emergencies without impacting savings.
Emergency Fund
Importance
• Keep an emergency fund.
• At least 6 months of expenses.
Liquid Assets
• Maintain liquidity in your portfolio.
• Use liquid funds or savings account.
Tax Planning
Tax-Saving Investments
• Invest in tax-saving instruments.
• Reduces tax liability and boosts savings.
ELSS Funds
• Consider Equity Linked Savings Scheme (ELSS).
• Provides tax benefits under Section 80C.
Risk Management
Assess Risk Tolerance
• Understand your risk tolerance.
• Invest accordingly to avoid stress.
Diversify Investments
• Spread investments across various funds.
• Reduces risk and enhances returns.
Finally
Loganathan, your current investment strategy is good. However, slight adjustments can improve your portfolio. Increase your large cap and liquidity fund allocations. Reduce small cap exposure slightly. Maintain your flexi cap investments. Regularly review and consult a Certified Financial Planner for personalized advice.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

..Read more

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Milind

Milind Vadjikar  |702 Answers  |Ask -

Insurance, Stocks, MF, PF Expert - Answered on Nov 26, 2024

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Hi Experts, I seek your guidance on my mutual fund portfolio. Below are the details: Total Portfolio Details: - Total Invested Amount: ?15,76,159 - Current Value: ?19,35,234 - Total Returns: ?3,59,075 (+22.78%) - XIRR: 20.75% Monthly SIP Contribution: ?1,18,000 Breakdown of monthly SIP contributions across funds: 1. Parag Parikh Flexi Cap Fund Direct Growth – ?30,000 2. SBI Large & Midcap Fund Direct Plan Growth – ?15,000 3. SBI Magnum Mid Cap Fund Direct Plan Growth – ?20,000 4. Nippon India Large Cap Fund Direct Growth – ?30,000 5. Nippon India Small Cap Fund Direct Growth – ?7,500 6. ICICI Prudential Technology Direct Plan Growth – ?10,000 7. Quant Small Cap Fund Direct Plan Growth – ?7,500 8. HSBC Small Cap Fund Direct Growth – ?5,000 9. Edelweiss US Technology Equity Fund of Funds Direct Growth – ?5,000 Can you suggest if I am on track to create 5 CR corpus in 10 years I have ?25 lakh invested in a Fixed Deposit (FD) in my mother’s account, earning an interest rate of 7.75%, to generate tax-free returns. Additionally, I’m planning to purchase a plot worth ?30–50 lakh in the next 1–2 years. Is it a good idea to keep the money in FD for now, or are there better short-term investment options I should consider to maximize returns while keeping the funds accessible for my future purchase? Looking forward to your suggestions! Thank you!
Ans: Hello;

Your monthly sip value adds upto 1.3 L however you have claimed it to be 1.18 L. (Maybe a typo).

Existing corpus(19.35 L) and monthly sip (1.3 L) won't reach 5 Cr in 10 years.

You have two options to make it happen:

1. Increase monthly sip amount to 1.9 L.

2. Top-up current monthly SIP of 1.3 L by minimum 10% each year for 10 years.

Both ways will lead you to a corpus of 5 Cr over 10 years.

You may consider money market mutual funds for parking your funds for a 1 year horizon. Returns may be comparable to FD returns but with flexibility to withdraw anytime. They typically have low to moderate risk.

Happy Investing;
X: @mars_invest

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Nayagam P P  |3928 Answers  |Ask -

Career Counsellor - Answered on Nov 26, 2024

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Is doing BBA + Law (Honors) from BITS Law is worth
Ans: Anju, prior to addressing the question, I would like to draw your attention to a recent article in 'The Times of India' which indicates that a majority of law graduates tend to favor employment in corporate settings over practicing in courts. Now, coming to your question, please note, BITS Law School's BBA + LLB (Hons) program is a 5-year program that combines business administration with legal studies. The program focuses on areas such as corporate law, intellectual property, business laws, and dispute resolution. The program offers a strong multidisciplinary approach, preparing students for careers in corporate law, legal consultancy, and management. Its strengths include a business + legal acumen curriculum, industry-driven curriculum, and a reputation for excellence in education and placement opportunities. However, it lacks the legacy and alumni network of top-tier law schools and can be expensive. Career opportunities include corporate and business law, management roles, consulting, entrepreneurship, academia/research, international arbitration, cyber and technology law, corporate governance, and intellectual property rights. The program is worth considering if you aim for a corporate or business law career, are comfortable with the cost and value of the BITS brand, and have excellent industry connections and internships. Build your profile well by the time you complete your BBA+LLB & improve your all other skills required. All the BEST for Your Prosperous Future.

To know more on ‘ Careers | Education | Jobs’, ask / follow Us here in RediffGURUS.

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DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Investment in securities market are subject to market risks. Read all the related document carefully before investing. The securities quoted are for illustration only and are not recommendatory. Users are advised to pursue the information provided by the rediffGURU only as a source of information and as a point of reference and to rely on their own judgement when making a decision. RediffGURUS is an intermediary as per India's Information Technology Act.

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