I am 40 Years old my annual income is 11-12 lakhs , SIP HDFC 4000, Kotak 4000, ICICI 4000, Parag Parikh 3000, Mahindra Manulife 3000, want to corpus of Rs.1 Cr in 10 yrs, pls suggest

Ans: Hello Value Investors. Please quantify your investment constraints.

Ans: Hello Value Investor. I can see over diversification with your current sip investments with 2.25L sip amount. I would suggest to concise your mf investments and reshuffle the portfolio. To achieve corpus of 5 cr in next 5 years, its advisable to increase your monthly contribution to 4-4.5L.

Ans: To accumulate a corpus of ₹1 crore in 10 years, you will need to invest around ₹44,000/- per month, assuming a return of 12% per annum.

However, it is important to note that this is just a rough estimate. Your actual investment returns may vary depending on a number of factors, such as the type of investments you choose and the market conditions.

Let’s evaluate the popular investments option available in India to invest :-

• FDs: Poor returns and heavy losses due to taxation. Ultimately ‘negative’ post-tax-and-inflation returns.

• Insurance Policies: It is not at all a good choice for investment purposes. It has a small insurance component that your child doesn’t need and has bad investment options clubbed with it.

• Provident Funds: Reasonable returns but returns of about 7-8% per annum are not adequate to beat the way inflation and education costs are rising.

• Mutual Funds: Only equity (stock) based investments can meet your long-term wealth creation goal with compounding effect and a small 10% tax will still ensure your money grows in net terms. Equity Mutual Funds with a SIP facility would meet the requirement in the best manner. However, do check whether your risk profile matches equity investments.