Greetings, my age is 44 years & apart from liabilities of loan, I sometimes feel like investing in MF, but looking at current scenario & people around me who have invested in MF have turned negative or are less than their investment in 3-years.

I need advice on investing in MF which should be balanced (tax saver can also do) in returns with horizon of 12-15 years looking ahead the responsibilities (daughter marriage & higher education) & expenses thereon.

A bigger chunk of my salary goes into loan repayment, approximately Rs 91435/month which is 55 per cent of my net income, so need advice as to really look at MF or wait as the liabilities are higher. 

These liabilities are towards my two home loans (rented with an income of Rs 8800 & one of the property is under construction) & a car loan.

Ans: This is fine; we can review it post 1 year

Ans: Rs. 2500 in each

1. Axis ESG Equity fund – Growth
2. UTI Flexi Cap fund – Growth
3. PPFAS Flexi Cap – Growth
4. DSP Quant Fund – Growth

Ans: It's excellent that you're considering diversifying your investments beyond fixed deposits. Given your investment horizon of 5 years for buying a house and your long-term savings goals, you can consider the following allocation:
Equity Investments: Allocate a significant portion of your monthly investment towards equity for long-term wealth creation.
Debt Investments: Allocate a portion towards debt instruments for stability and capital preservation, suitable for your house purchase goal in 5 years.
Tax-Saving Instruments: Invest in tax-saving options like ELSS to fulfill your tax-saving requirements.
Retirement Planning: Consider long-term retirement-focused investments like PPF or NPS.
Emergency Fund: Maintain a liquid emergency fund for unforeseen expenses.
Regular Review: Regularly review and adjust your investments to align with changing financial goals and market conditions.

Ans: It's fantastic to see your proactive approach towards investing and planning for your financial future. At 37, you're at a pivotal stage where strategic investments can pave the way for substantial wealth accumulation. Let's delve into your current investment strategy and explore avenues to optimize returns while aiming for your target of ?3 crore in the next 10 years.

Commending Your Initiative

Firstly, kudos to you for taking the initiative to invest and secure your financial future. Your commitment to monthly investments showcases a disciplined approach towards wealth creation, which is commendable.

Evaluating Your Current Investments

Let's analyze your existing investment portfolio to gauge its potential to achieve your financial goals. You've allocated your investments across different avenues, including insurance and mutual funds, which reflects a diversified approach.

Assessing Investment Avenues

While your current investments exhibit diversity, let's explore additional avenues to enhance your portfolio's growth potential. Here's how we can optimize your investment strategy:

Equity Mutual Funds: Considering your investment horizon of 10 years, equity mutual funds offer the potential for higher returns. We'll focus on selecting funds with a strong track record of performance and reputable fund management teams.

Debt Mutual Funds: To balance risk, we'll allocate a portion of your investments to debt mutual funds. These funds provide stability to your portfolio and serve as a hedge against market volatility.

Systematic Investment Plans (SIPs): Leveraging SIPs allows you to benefit from rupee cost averaging and invest systematically over time, irrespective of market fluctuations.

Benefits of Actively Managed Funds

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

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

Dynamic Allocation: Actively managed funds have the flexibility to adapt to changing market conditions, enabling fund managers to optimize returns and mitigate risks.

Disadvantages of Direct Funds

Direct funds require investors to conduct independent research and select funds without professional guidance. This approach can be challenging and time-consuming, especially for investors lacking financial expertise.

Benefits of Regular Funds Investing through MFD with CFP Credential

Investing through a Certified Financial Planner (CFP) credentialled Mutual Fund Distributor (MFD) offers several benefits:

Personalized Advice: A CFP-certified MFD provides tailored investment advice based on your financial goals and risk tolerance, ensuring your portfolio aligns with your objectives.

Access to a Wide Range of Funds: MFDs offer access to a diverse range of mutual funds, enabling you to build a well-rounded investment portfolio tailored to your needs.

Final Words

As you embark on this journey towards wealth creation, remember that consistency, patience, and prudent decision-making are key. By diversifying your investments, leveraging the expertise of certified professionals, and maintaining a long-term perspective, you're well-positioned to achieve your financial aspirations.

Warm Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in