Dear All, I am 36 working in a pvt Bank married and have a kid 3 years old, don't have any investment and savings due to family commitments.Now I want to start investing pls help/guide how and what to start with?

Ans: Starting your investment journey at 36 is a responsible and positive step towards securing your financial future. Here’s a structured approach to help you get started, considering your current situation and future goals.

Assess Your Financial Situation
Before investing, it’s crucial to understand your current financial standing. Calculate your monthly income, expenses, and any existing debts. This will give you a clear picture of how much you can invest monthly.

Setting Financial Goals
Set clear, achievable financial goals. These might include:

Emergency Fund: Cover 6-12 months of expenses.
Child’s Education: Plan for your 3-year-old’s future education costs.
Retirement: Secure your financial independence post-retirement.
Other Goals: House purchase, vacations, etc.
Building an Emergency Fund
Before starting any investment, create an emergency fund. This fund should cover at least 6 months of living expenses. It acts as a financial buffer against unexpected events like medical emergencies or job loss.

Life and Health Insurance
Ensure you have adequate life and health insurance. These insurances protect your family financially in case of any unforeseen events. A term insurance plan is advisable for life cover, and a family floater health insurance plan for medical emergencies.

Starting with Systematic Investment Plan (SIP)
SIPs are a disciplined way to invest in mutual funds. They allow you to invest a fixed amount regularly, helping you average out the cost of purchasing mutual fund units over time.

Suggested SIP Allocation
Given your goals and starting point, here’s a suggested allocation:

Equity Mutual Funds:

Suitable for long-term goals like retirement and child’s education.
Allocate about 70% of your investment here for higher returns.
Debt Mutual Funds:

Suitable for short-term goals and stability.
Allocate about 20% to balance risk.
Hybrid/Balanced Funds:

A mix of equity and debt.
Allocate about 10% for moderate risk and returns.
Suggested Fund Allocation
Large-Cap Fund: Focus on stability and consistent returns.

Monthly SIP: 3,000 rupees
Mid-Cap and Flexi-Cap Funds: Offer higher growth potential.

Monthly SIP: 4,000 rupees
Debt Funds: Provide stability and lower risk.

Monthly SIP: 2,000 rupees
Balanced/Hybrid Funds: Mix of equity and debt.

Monthly SIP: 1,000 rupees
Steps to Start Investing
Open an Investment Account:

Choose a reputable mutual fund provider or an online investment platform.
Start with SIPs:

Set up SIPs in the recommended funds.
Automate monthly investments to ensure consistency.
Monitor and Review:

Regularly review your portfolio’s performance.
Make adjustments based on your financial goals and market conditions.
Importance of Professional Guidance
Consider consulting a Certified Financial Planner (CFP). A CFP can provide personalized advice tailored to your financial situation and goals. They can help you choose the right funds, ensure your investments align with your goals, and make necessary adjustments.

Avoiding Common Pitfalls
Avoid High-Risk Investments: Don’t invest in high-risk assets without understanding them.
Stay Disciplined: Stick to your investment plan and avoid impulsive decisions.
Don’t Overlook Insurance: Ensure you have adequate life and health insurance.
Conclusion
Starting investments at 36 is a wise decision for securing your family’s future. By building an emergency fund, getting proper insurance, and investing systematically through SIPs, you can achieve your financial goals. Regular reviews and professional guidance will keep you on track.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in