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Ramalingam

Ramalingam Kalirajan  |6266 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 01, 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
Asked by Anonymous - Feb 01, 2024Hindi
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Could you please advise how much monthly SIP should be invested to reach a goal of 50 Lacs in 3 years, consider moderate to high risk investment options in MF and pls advise the preferred portfolio

Ans: Achieving a goal of 50 lakhs in 3 years through mutual fund SIPs entails aggressive investing due to the relatively short time horizon. Given the moderate to high risk appetite, here's a suggested approach:

Large & Mid Cap Funds: Allocate around 40-50% of your SIP amount to large & mid-cap funds. These funds invest in a mix of large and mid-sized companies, offering growth potential with relatively lower risk compared to small caps.
Mid & Small Cap Funds: Dedicate around 30-40% of your SIP to mid & small-cap funds for higher growth potential. These funds invest in mid and small-sized companies, which can be volatile but offer the potential for significant returns.
Multi Cap Funds: Allocate the remaining 10-20% to multi-cap funds for diversification across market capitalizations. Multi-cap funds invest in companies across market segments, providing flexibility to capitalize on emerging opportunities.
Considering the aggressive approach and relatively short timeframe, you may need to invest a significant amount monthly. However, it's crucial to assess your risk tolerance and financial capacity before committing to higher SIP amounts. Consulting with a Certified Financial Planner can help tailor the portfolio and SIP amount to your specific goals and risk profile.
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  |6266 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 09, 2024

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Hello Dev, I am 32 years old and would like to start SIP for 5k per month to create retirement corpus of 1 crore. Also would like to generate 30 lacs in another 10 years for closing housing loan. Already have three MF SIP as below. Quant active fund 1000 Quant ELSS tax saver fund 500 ICICI prudential corporate bond fund 150 Kindly suggest in which MF should I invest further and also how much should I increase the SIP amount to achieve the above goals. Thank you.
Ans: It's great to see your proactive approach towards planning for your financial future. Your dedication to investing is commendable.
Starting an SIP with 5k per month is a wise decision to create a retirement corpus of 1 crore. Additionally, generating 30 lakhs in 10 years to close your housing loan is a smart goal.
Considering your existing SIPs in Quant Active Fund, Quant ELSS Tax Saver Fund, and ICICI Prudential Corporate Bond Fund, you have a good foundation. However, to diversify your portfolio and align it with your goals, you may want to consider the following suggestions:
1. Equity-oriented funds with higher growth potential can help you achieve your long-term goals. Look into diversified equity funds or multi-cap funds for exposure to various segments of the market.
2. Since your investment horizon is long-term, you can afford to take slightly higher risks for potentially higher returns. Adding more equity-oriented funds can help you achieve this.
3. To generate the required amount for your housing loan closure in 10 years, you may need to increase your SIP amounts gradually. Consider reviewing your financial situation periodically and increasing your SIP contributions accordingly.
4. As a Certified Financial Planner, I recommend staying disciplined with your investments and adhering to your financial plan. Regularly review your portfolio's performance and make adjustments as needed to stay on track towards your goals.
By diversifying your portfolio and gradually increasing your SIP amounts, you can work towards achieving your financial objectives effectively.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |6266 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 06, 2024

Asked by Anonymous - Apr 03, 2024Hindi
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I am 33 years old and I have created corpus of 40 Lacs. My current monthly SIP is Scheme Value Axis MF Bluechip 2000 Axis Small Cap 3000 HDFC MF World 2000 HDFC Retirement 2000 ICICI Floating interest 2000 ICICI India Oppor 2500 ICICI Value Discovery 4000 Mirae MF 2000 Nippon Small Cap 4000 NPS 5000 Parag Flexi cap 4000 PGIM Mid Cap 2000 Quant eTeck 2500 Quant Flexicap 3000 Quant Focussed 2000 Quant Multi cap 6000 Tata MF Retirement 2000 Along with this 12 gm SGB per year PF + VPF - 9662 per Month Recurring Deposit 1000 per month.
Ans: It's impressive to see the diligence you've put into building a substantial corpus at the age of 33. Your commitment to systematic investing through SIPs and other avenues reflects a strong financial discipline. Let's delve into your portfolio to ensure it's aligned with your long-term goals and risk appetite.

Axis MF Bluechip: This fund focuses on large-cap stocks, offering stability and growth potential. It's a prudent choice for core equity exposure.
Axis Small Cap: Small-cap funds like this have the potential for high growth but come with higher volatility. Ensure you have a long investment horizon and risk tolerance for this category.
HDFC MF World: International funds like this provide diversification benefits by investing in global markets. However, be mindful of currency risk and volatility.
HDFC Retirement: Retirement-focused funds aim to generate wealth over the long term while managing risk. Ensure this fund aligns with your retirement goals and risk tolerance.
ICICI Floating Interest: Floating rate funds can provide protection against interest rate fluctuations. They are suitable for investors seeking stable income with lower interest rate risk.
ICICI India Opportunity: This fund focuses on Indian equities across market caps, offering diversification within the domestic market.
ICICI Value Discovery: Value-oriented funds like this invest in undervalued stocks with the potential for long-term growth. They can complement growth-oriented funds in a portfolio.
Mirae MF: Mirae Asset Mutual Funds offer a range of equity and debt funds known for consistent performance and strong fund management.
Nippon Small Cap: Small-cap funds offer the potential for high returns but come with higher risk. Ensure you have a long-term investment horizon and risk tolerance for this category.
NPS: Contributing to NPS is a tax-efficient way to build a retirement corpus. It's great that you're prioritizing retirement savings at a young age.
Parag Flexi Cap: Flexi-cap funds provide flexibility to invest across market caps based on market conditions. They offer diversification and growth potential.
PGIM Mid Cap: Mid-cap funds focus on stocks of mid-sized companies, offering higher growth potential than large caps but with higher risk.
Quant eTeck, Flexi-cap, Focused, Multi-cap: Quant funds use quantitative models to select stocks. They offer a systematic approach to investing but require monitoring and adjustment.
Tata MF Retirement: Retirement-focused funds aim to provide wealth accumulation and income generation during retirement. Ensure this fund aligns with your retirement goals.
Sovereign Gold Bonds (SGB): SGBs offer a convenient way to invest in gold with sovereign guarantee and fixed interest. They serve as a hedge against inflation and currency fluctuations.
PF + VPF: Contributing to PF and VPF is a prudent way to build a retirement corpus while enjoying tax benefits and employer contributions.
Recurring Deposit: RDs offer a safe and stable way to accumulate savings over time. However, consider exploring other investment options for potentially higher returns, especially for long-term goals.

but it's essential to streamline your portfolio for better management and effectiveness. Having too many schemes can lead to overlap and complexity, making it challenging to track performance accurately.

Consider consolidating your investments into a more focused selection of funds that cover different asset classes and investment styles. This consolidation will not only simplify monitoring but also reduce administrative hassle and potentially lower costs.

Start by identifying the core funds that align with your investment objectives and risk tolerance. Aim for a diversified portfolio that includes equity, debt, and other asset classes based on your financial goals and time horizon.

Review your existing holdings and gradually consolidate them into a more manageable number of funds. Focus on quality over quantity, choosing funds with a proven track record, strong fund management, and consistent performance.

Consulting with a Certified Financial Planner can provide valuable insights and guidance on restructuring your portfolio for optimal efficiency and effectiveness. They can help you identify redundancies, eliminate underperforming funds, and reallocate resources to maximize returns while minimizing risk.

By consolidating your investments, you'll not only simplify your financial strategy but also enhance your ability to achieve your long-term financial goals more effectively.

..Read more

Ramalingam

Ramalingam Kalirajan  |6266 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 10, 2024

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Hello Sir, I would like to accumulate 33 lacs in 2 to 2.5 years. What are the SIP options? I am ok with moderate risk. My currently salary is 2.5 lacs per month and my monthly expenses of 1 Lac approximately.
Ans: Accumulating Rs 33 lakhs in 2 to 2.5 years is a significant goal. Given your monthly salary of Rs 2.5 lakhs and expenses of Rs 1 lakh, you have a good surplus to work with. Let's create a strategic plan to achieve your goal while maintaining a moderate risk profile.


It's impressive that you're proactive about your finances. Managing a high income and being able to save significantly shows your financial discipline. Let's leverage this to build your desired corpus.

Assessing Your Current Financial Situation
Monthly Savings Potential
With a salary of Rs 2.5 lakhs and expenses of Rs 1 lakh, you have a surplus of Rs 1.5 lakhs each month. This is a strong base for your investment plan.

Investment Horizon
You have a short investment horizon of 2 to 2.5 years. This requires a balanced approach, ensuring moderate risk while aiming for the desired returns.

Diversified Investment Strategy
Mutual Funds
Mutual funds offer diversification and professional management, making them suitable for achieving your goal within the given timeframe.

Systematic Investment Plan (SIP)
SIPs allow you to invest regularly, taking advantage of market fluctuations and averaging out the cost of investment.

Categories of Mutual Funds
Debt Funds
Debt funds invest in fixed-income securities. They offer lower risk and stable returns, suitable for short-term goals.

Hybrid Funds
Hybrid funds combine equity and debt investments. They offer a balanced approach, providing growth potential with reduced volatility.

Equity Funds
Equity funds invest in stocks and offer high growth potential. They come with higher risk but can be considered for part of your portfolio to boost returns.

Power of Compounding
Investing regularly in SIPs leverages the power of compounding. Even within a short period, compounding can significantly enhance your returns.

Disadvantages of Index Funds
Index funds passively track a market index. They may not outperform the market and lack flexibility to adapt to changing conditions.

Benefits of Actively Managed Funds
Actively managed funds have professional managers aiming to outperform the market. They provide better returns through strategic investments.

Direct Funds vs. Regular Funds
Direct Funds
Direct funds save on commission costs but require self-management. Without expertise, this can be challenging.

Regular Funds through CFP
Investing through a Certified Financial Planner (CFP) offers expert guidance, ensuring your investments are aligned with your goals and risk tolerance.

Risk Management
Diversification
Diversify your investments across different fund categories to spread risk and enhance potential returns.

Risk Assessment
Regularly assess your risk tolerance. Given the short investment horizon, it's crucial to balance growth and stability.

Tax Efficiency
Tax Planning
Optimize your investments for tax efficiency. Consult a CFP for personalized tax strategies, ensuring you maximize returns while minimizing tax liability.

Tax-Free Bonds
Consider tax-free bonds for stable, tax-efficient income. They offer guaranteed returns and are a safe investment option.

Creating a Detailed SIP Plan
Monthly SIP Allocation
Based on your monthly surplus, allocate funds to different SIPs. Consider a mix of debt, hybrid, and equity funds to balance risk and return.

Monitoring and Adjusting
Regularly review your SIP portfolio. Adjust allocations based on market conditions and your evolving financial goals.

Final Insights
Accumulating Rs 33 lakhs in 2 to 2.5 years requires a disciplined and strategic investment approach. Utilize mutual funds through SIPs, balancing your portfolio across debt, hybrid, and equity funds. Regularly review and adjust your investments with the guidance of a Certified Financial Planner. With dedication and the right strategy, you can achieve your financial goals and build a secure future.

Best Regards,

K. Ramalingam, MBA, CFP

Chief Financial Planner

www.holisticinvestment.in

..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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