I am 34 year old. I just want to start sip in mutual funds or elss. Please suggest funds for next 20 year to achieve 2 crore.

Ans: Starting SIPs (Systematic Investment Plans) in mutual funds or ELSS (Equity Linked Savings Schemes) can be an excellent way to build wealth over the long term. Here's a tailored approach for you:
1. Mutual Funds vs. ELSS: Both mutual funds and ELSS offer the potential for wealth creation, but they have different tax implications. ELSS investments come with a lock-in period of three years and offer tax benefits under Section 80C of the Income Tax Act. Mutual funds, on the other hand, offer flexibility but may not have the same tax advantages.
2. Asset Allocation: Given your age and the long-term investment horizon of 20 years, a diversified portfolio comprising equity and debt instruments would be suitable. Equity investments offer higher growth potential but come with higher risk, while debt investments provide stability and lower risk.
3. Equity Funds: For your SIPs, consider allocating a significant portion to equity funds, which have historically delivered higher returns over the long term. You can choose a mix of large-cap, mid-cap, and small-cap funds to diversify your equity exposure and manage risk.
4. ELSS for Tax Benefits: Since you have a long investment horizon, allocating a portion of your SIPs to ELSS can help you avail tax benefits while also participating in equity market growth. However, keep in mind the lock-in period associated with ELSS investments.
5. Regular Monitoring: It's essential to review your investment portfolio periodically, ideally annually, to ensure that it remains aligned with your financial goals and risk tolerance. You may need to rebalance your portfolio based on changing market conditions and your evolving financial situation.
Remember, consistency and discipline are key to achieving your financial goals through SIPs. Start with an amount that you can comfortably invest each month and gradually increase it over time as your income grows.

Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner
www.holisticinvestment.in