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Ramalingam Kalirajan |10881 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on May 29, 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

Question by Nicholas on Nov 27, 2023Hindi

My age is 43 and I an investing in below MF for last 5 years .I retire at 58 and I have a daughter of 3 .I target to accumulate at least 4-5cr by retirement for my daughters marriage and retirement. Will the below investment help me or should I I change my mutual funds? I can invest 40K a month totally in Mutual Funds. Axis Blue chip Fund -2500 per month Canara Robeco Blue Chip Equity Fund -5000 per month LIC MF LARGE AND MIDCAP FUND -3500 per month Fund Mirae Asset Emerging Bluechip Fund 2000 -2500 Per month Axis Small Cap Fund - 4000 per month SBI Contra Fund -3000 Per month Since last 1 year investing in HDFC Balanced Advantage fund -4000 per month Quant Absolute fund - 3000 per month Besides the above I also have a term life insurance of 1.25cr and also tax savings MF @6K per month ( for last 10 yrs)and LIC policy of 10Lacs.

Ans: Evaluating Mutual Fund Portfolio for Long-Term Goals
Your commitment to securing your daughter's future and planning for your retirement is admirable. Let's delve deeper into your current mutual fund portfolio, assess its alignment with your goals, and explore potential adjustments to optimize returns.

Understanding Your Goals
Your target of accumulating Rs 4-5 crore by retirement for your daughter's marriage and your own retirement underscores the importance of strategic financial planning. With approximately 15 years until retirement, it's crucial to ensure your investment strategy is robust and aligned with these objectives.

Assessing Current Investments
Your existing mutual fund portfolio comprises a diversified mix of large-cap, mid-cap, small-cap, and balanced advantage funds. While diversification is key to managing risk, it's essential to evaluate each fund's performance and suitability for your long-term goals.

Reevaluating Fund Selection
While your current fund selection demonstrates a thoughtful approach, it's prudent to reassess each fund's performance and potential for delivering optimal returns. Consider factors such as historical performance, fund manager expertise, expense ratios, and portfolio composition.

Surrendering LIC Policy for Better Returns
The decision to surrender your LIC policy and reinvest the proceeds into mutual funds can significantly impact your overall returns. With term life insurance coverage already in place, redirecting funds towards investments offering potentially higher returns is a strategic move towards achieving your financial goals.

Optimizing Portfolio Allocation
Allocate the surrendered LIC policy amount into high-performing mutual funds with a proven track record of consistent returns.
Assess the performance of each fund in your portfolio and consider replacing underperforming funds with better alternatives to enhance overall portfolio returns.
Focus on funds that align with your risk tolerance, investment horizon, and long-term financial objectives.
Regular Review and Rebalancing
Regularly reviewing your mutual fund portfolio is essential to ensure it remains aligned with your goals and risk appetite. Periodic rebalancing helps optimize returns and mitigate portfolio risk by realigning asset allocation as needed.

Conclusion
Your commitment to securing your daughter's future and planning for your retirement through strategic investments is commendable. By reassessing your mutual fund portfolio, surrendering underperforming assets, and optimizing allocation towards high-performing funds, you can enhance your chances of achieving your target of Rs 4-5 crore by retirement.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

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