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Omkeshwar

Omkeshwar Singh  | Answer  |Ask -

Head, Rank MF - Answered on Sep 15, 2022

Mutual Fund Expert... more
Pritam Question by Pritam on Sep 15, 2022Hindi
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I am 38 years old; I need your advice on how much corpus can be made with the following investments after 20 years; also please advise whether I need to stop/switch/step up any of the following mutual fund investments for next 20 years, below is my investment portfolio:

1. PPF every month 12500 (started on Apr 2017)

2. Sukankya Samriddhi Yojana every month 12500 (started on May 2018 but for FY 2018-19 only Rs 20000 was deposited, after that from Apr 2019 onwards, Rs 12500 is deposited every month)...this is for my 4 year old daughter

3. Mutual funds (Started in Nov 2019): Rs 20000 SIP monthly, following 10 funds: Rs 2000 each

3.1 Axis Bluechip Fund -Regular Plan - Growth, total amount invested so far RS 29000

3.2 Canara Robeco Blue Chip Equity Fund, total amount invested so far RS 29000

3.3 MIRAE ASSET EMERGING BLUECHIP REGULAR GROWTH, total amount invested so far RS 24000

3.4 HDFC Multi Cap Fund - Regular Plan - Growth Option, total amount invested so far RS 24000

3.5 HDFC Developed World Indexes Fund of Funds - Regular Plan - Growth Option, total amount invested so far RS 24000

3.6 ICICI Prudential NASDAQ 100 Index Fund - Growth, total amount invested so far RS 24000

3.7 L&T INFRASTRUCTURE FUND, total amount invested so far RS 29000

3.8 PARAG PARIKH FLEXI CAP FUND -REGULAR PLAN, total amount invested so far RS 29000

3.9 UTI NIFTY 50 INDEX FUND-REGULAR PLAN-GROWTH, total amount invested so far RS 24000

3.10 TATA DIGITAL INDIA FUND-REGULAR PLAN-GROWTH, total amount invested so far RS 24000

4. HDFC Life click 2 wealth Investment Rs 5000 monthly with discovery fund for 10 years (started in Nov 2019), total amount invested so far RS 45000

Ans: There sufficient diversification as far as asset allocation is considered.

In mutual funds the schemes are also fine, but too many!

The corpus that will get created by mutual funds in 20 years with monthly Investment of Rs 20000 is Rs 2.6 crore.

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  |10219 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 21, 2024

Asked by Anonymous - May 14, 2024Hindi
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Hello Sir, i am 34 yrs now and invested in mutual funds from more than 2 and half yrs and its current value is 2.5 lakh and ppf with value 3 lakh and stocks worth 2 lakhs. I am also invested in ulip for 1 lack per annum 5 years and its current value is 7.2 lakh. If i invest in mutual funds(10000 per month) till 55 yrs how much corpus will i get?
Ans: It's great to see your proactive approach towards investing and building wealth for your future. Your commitment to mutual funds, PPF, stocks, and ULIPs reflects a well-diversified investment portfolio.

Understanding Your Current Investments

Your investment portfolio comprising mutual funds, PPF, stocks, and ULIPs showcases a balanced mix of asset classes, indicating a thoughtful approach towards wealth creation.

Evaluating Mutual Fund Investment

By investing ?10,000 per month in mutual funds till the age of 55, you're adopting a disciplined savings approach that can potentially yield substantial returns over the long term.

Analyzing Expected Corpus

To estimate the corpus you may accumulate by the age of 55 through your monthly mutual fund investments, we need to consider several factors:

Investment Duration: With approximately 21 years left until you turn 55, your monthly investments have a considerable time horizon to grow.

Rate of Return: The expected rate of return on your mutual fund investments plays a crucial role in determining the final corpus. While past performance is not indicative of future results, historical data can provide insights into potential returns.

Systematic Investment Plan (SIP): Investing through SIPs allows you to benefit from the power of compounding by regularly investing fixed amounts over time.

Estimating Future Corpus

To provide an estimate of the corpus you may accumulate by the age of 55, we can use a conservative annual return assumption for your mutual fund investments.

Considering historical market performance and assuming a moderate annual return rate, we can project the growth of your monthly investments over the next 21 years. By compounding your investments annually, we can calculate the future value of your mutual fund portfolio.

Benefits of Actively Managed Funds

Actively managed mutual funds offer several benefits over passive index funds or ETFs:

Professional Management: Skilled fund managers actively monitor market trends and adjust portfolio allocations to capitalize on growth opportunities, potentially leading to higher returns.

Risk Management: Actively managed funds employ strategies to mitigate risks and optimize returns, providing investors with a balanced risk-return profile.

Final Words

While it's essential to have a long-term investment horizon and a disciplined savings approach, it's equally crucial to regularly review and adjust your investment strategy as per changing market conditions and personal financial goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |10219 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 15, 2025

Money
sir I have invested Monthly since last 2years on the following Mutual funds Rs6000 in HDFC Top 100, In Invesco global consumer Rs. 5000, DSP ELSS Rs5000,PGIM Mid cap opportunity fund Rs.5000 axis Mutual Fund special situation Rs.2000, Hdfc mid cap Rs.5000, Quant mid cap 10000, Icici Prudential Manufacturing Rs.5000,Tata Infrastructure Fund Rs.5000,Invesco India PSU fund Rs.5000,Motilal Oswal Large and mid cap fund rs.5000, sbi energy opportunity fund rs 5000, Tata Digital fund rs 5000, Hdfc defense fund rs 5000, after 10 years how much Total corpus I will get . I want to make 3cr in next 10 years corpus for this where I have to invest and how much
Ans: You are investing Rs.77,000 monthly across various mutual fund schemes.

You’ve completed 2 years. You plan to continue for 10 more years.

You want to know two key things:

How much corpus can you expect after 10 years?

How to reach your target of Rs.3 crores?

Let us explore this in detail with a professional and 360-degree view.

I’ll write this in a simple tone with short sentences, as per your guidance.

Let’s begin.

Your Current Investment Summary

You are investing Rs.77,000 monthly in mutual funds.

You’ve done this consistently for the last 2 years.

You’re planning to continue for another 10 years.

Your current SIPs are spread across large cap, mid cap, sectoral, ELSS and global funds.

That shows discipline and commitment. Appreciate your long-term vision.

This strategy gives long-term compounding benefit.

Diversification across sectors also helps reduce some risk.

But too many funds may reduce effectiveness.

Expected Corpus in 10 Years with Current SIPs

If you continue Rs.77,000 monthly for the next 10 years…

And assuming average returns around 11% to 12% per year…

Your total corpus may become between Rs.1.60 crores to Rs.1.75 crores.

This is over and above the Rs.20 lakhs already invested in the last 2 years.

Including the existing corpus, your total may reach Rs.2.10 to Rs.2.25 crores.

This is a good base, but still short of Rs.3 crore target.

There is a gap of about Rs.75 lakhs to Rs.90 lakhs.

That gap needs to be addressed carefully.

How Much More is Required to Reach Rs.3 Crores

You need to increase your monthly SIP.

Increasing SIP by Rs.20,000 to Rs.25,000 monthly can help bridge the gap.

Even a 10% annual SIP step-up can accelerate growth.

But it must be sustainable and consistent.

Avoid large fluctuations in SIP values every year.

Ideal SIP Amount to Target Rs.3 Crores

For a target of Rs.3 crores in 10 years…

You may need to invest about Rs.95,000 to Rs.1,00,000 monthly.

You are already investing Rs.77,000. So only Rs.18,000 to Rs.23,000 more is needed.

If income grows yearly, increase SIPs by 10% annually.

This method works better than one-time increase.

Gradual increase suits most investors mentally and financially.

Assessment of Fund Category Mix

Your current funds include many sectoral schemes.

Sector funds carry higher risk and volatility.

Overexposure to such funds may reduce consistency.

You also have multiple midcap funds.

While midcaps give growth, they can fall sharply in downturns.

A balanced mix of large cap, flexi cap, and mid cap is better.

You may reduce sectoral funds and focus more on diversified categories.

Suggestion: Trim the Number of Funds

You have more than 12 mutual fund schemes now.

This leads to portfolio overlap and confusion.

Fund performance becomes difficult to track.

Too many schemes also duplicate stocks.

Best is to keep only 5 to 7 well-selected schemes.

Choose those which consistently beat benchmarks over 5+ years.

Keep them from different categories for better balance.

Keep More in Diversified Equity Funds

Avoid high allocation to thematic or sector-specific funds.

Sectors like defence, infrastructure, digital, PSU are cyclical.

They don’t perform all the time.

For long-term wealth, diversified funds work better.

Flexi cap and multi-cap funds adapt better to market cycles.

You may retain 1 sectoral fund, but not more than that.

Over-diversification in sectors reduces stability.

Avoid Index Funds Completely

Index funds are passive. They copy market index.

They don’t aim to beat returns.

In India, active funds often outperform index funds.

Also, index funds fail in sideways or falling markets.

They don’t protect downside.

Expense ratio may be low, but so are returns.

With Certified Financial Planner and MFD, regular funds give better support.

Active funds have dynamic portfolio management.

Stick to Regular Mutual Funds Through MFDs and CFPs

Direct funds may seem cheaper. But they lack guidance.

Most investors make wrong entries and exits in direct funds.

They often get average or below-average returns.

With regular funds via MFD and CFP, advice is continuous.

Emotional handholding is equally important as returns.

CFPs also monitor rebalancing, asset allocation, and fund changes.

They help you stay on track in volatile markets.

Taxation of Mutual Funds Must Be Understood

Under new rules, equity fund LTCG above Rs.1.25 lakhs is taxed at 12.5%.

Short term gains (less than 1 year) taxed at 20%.

So, long holding period is good.

Avoid frequent switches or redemptions.

SIPs older than 1 year become tax efficient.

Maintain SIPs minimum 5 to 7 years for optimal results.

Strategy to Reach Rs.3 Crore in 10 Years

Increase SIP to Rs.95,000 to Rs.1 lakh monthly.

Stick to 5 to 7 diversified equity funds only.

Remove excess sectoral and overlapping schemes.

Add flexi cap, large and midcap, and ELSS for discipline.

Review performance once in a year with your CFP.

Step up SIPs by 10% annually, if income allows.

Reinvest all dividends and don’t withdraw midway.

Track fund consistency, not just recent returns.

Invest only through CFP-led MFD platforms for better behaviour tracking.

Avoid These Common Mistakes

Don’t stop SIPs in falling markets.

Don’t chase short-term top-performing funds.

Avoid direct mutual funds without proper tracking.

Don’t rely heavily on infrastructure, defence or PSU funds.

Don’t withdraw unless it’s an emergency.

Don’t compare portfolio with friends or relatives.

Monitor Investment Journey Yearly

Check corpus progress every 12 months.

Ensure you’re on track to Rs.3 crore.

Your CFP can use goal-tracking tools to assist.

Adjust funds if performance drops consistently.

Don’t panic over short-term falls.

Keep long-term mindset always.

Keep updating your KYC, FATCA, nominee details yearly.

Stay invested through all market cycles.

Behavioural Discipline is More Important Than Fund Selection

Even best fund can’t deliver if you stop SIPs halfway.

Behaviour matters more than timing or fund choice.

Investing monthly is already a big success.

Staying for 10 years multiplies your advantage.

Role of Emergency Fund and Insurance

Keep Rs.3 to Rs.6 lakhs as emergency fund.

Don’t touch mutual funds for short-term needs.

Have Rs.10 lakh health insurance and term insurance of Rs.1 crore minimum.

This protects your SIPs in emergencies.

Review insurance covers every 2 years.

Finally

You are already on a strong path with Rs.77,000 SIP.

Just increase it by Rs.20,000 monthly to target Rs.3 crores.

Avoid holding too many funds. Keep it focused and diversified.

Say no to index and direct funds.

Stick to regular plans with Certified Financial Planner support.

Remove excess sectoral allocation. Stay with core categories.

Review annually with your CFP. Adjust if needed.

Don’t lose focus in market corrections.

Rs.3 crores is very much achievable with these steps.

Stay consistent. Stay informed. Stay disciplined.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment

..Read more

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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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