I am buying MFs through icici direct It was till now mostly elss to save tax I want to invest in bulk ( no SIP ) now My questio is I gather icici would charge 1.5 % upfront for any buys and 1% on it every year then onwards so after 10 yars i...

I am buying MFs through icici direct It was till now mostly elss to save tax I want to invest in bulk ( no SIP ) now My questio is I gather icici would charge 1.5 % upfront for any buys and 1% on it every year then onwards so after 10 yars i gain say 15 % overall then , 11.5 % ( 1.5 +10 ) will already been charged by icici leaving me with 3.5% returns? Is this correct ? they never rwspond transparently abd give evasive replies

Ans: It's important to clarify the fee structure and its impact on your overall returns when investing through platforms like ICICI Direct. While they may charge an upfront fee and an annual fee for maintaining your investments, the impact on your returns may not be as significant as you've outlined.

Firstly, the upfront fee is typically a one-time charge applied at the time of purchase and is not deducted annually from your investment returns. Similarly, the annual fee (if applicable) is usually a percentage of the assets under management and is deducted from your investment periodically, rather than as a lump sum at the end of the investment period.

While fees can affect your returns, it's essential to consider the potential returns generated by your investments over time. If your investments perform well, they can potentially outweigh the impact of fees on your overall returns.

However, it's crucial to have clarity on the fee structure and its impact on your investments. If you're unsure about the fees charged by ICICI Direct or if you feel they're not being transparent, it may be beneficial to seek advice from a Mutual Fund Distributor (MFD) who can provide unbiased guidance and help you navigate the investment process more effectively. Working with an MFD can bring synergy to your investment journey and ensure you make informed decisions aligned with your financial goals.

Ans: Your commitment to steady SIPs is very good.
You track your performance with care.
You show patience and long-term thinking.
This discipline builds strong wealth.
Your long journey also shows deep faith in equity.
That faith will reward you over time.

Your SIPs run across large cap, large and mid cap, flexi cap, mid cap and small cap.
You also hold three lump sum funds in different areas.
Your spread is wide.
Your base is strong.
You also ask valid concerns about low-return funds.
And you want to place money in better performing places.
I will cover all these points step by step.

» Your Current Portfolio Shape

Your SIP covers five categories.
That reduces risk.
This protects you during market swings.
Your mix also supports long-term growth.
You have long-running SIPs.
They create deep compounding.
You also started some new SIPs recently.
These new SIPs need time.

Your lump sum part sits in three equity areas.
These areas offer stable and cyclical growth.
So your portfolio works like a full basket.
Some parts grow fast.
Some parts grow slow.
But together they create balance.

Your idea to review poor-performing SIPs is normal.
Most investors feel this at some point.
But decisions need clear analysis.
Not emotion.
Not short-term fear.
Not short-term disappointment.

» Why Some SIPs Show Low Returns Today

Three SIPs are worrying you.
They are small cap and mid cap oriented.
These categories behave differently.
They run in cycles.
Their gains rise sharply in some cycles.
They fall sharply in others.
This is normal for these categories.

Your SIP start dates are also very recent.
Some are only a few months old.
One is just around one year.
One is around one and half years.
Such short periods don’t show true performance.
They only show temporary market mood.

Small caps need long periods.
At least five years.
Sometimes seven years.
Sometimes even more.
Mid caps need patience as well.
New SIPs don’t show real power early.

Your low returns now do not mean poor fund quality.
They show only market phase.
Phases change.
Returns shift fast.
Small and mid caps often jump after weak phases.

So please don’t judge these new SIPs now.
Give them more time.
They started in a volatile cycle.
And that is the only reason returns look low.

» Should You Shift These SIPs to Your Stronger Funds?

You are thinking to move these SIPs into your stable performers.
Your stable performers include large cap, long-running flexi cap, large and mid cap, and long-running small cap.
They show strong long-term returns.
They also have long histories with you.

But shifting now can break your asset mix.
If you move money away from mid and small caps, your portfolio will tilt heavy to large caps.
This reduces long-term return potential.
Large caps are stable but slow.
Small and mid caps add speed in long-term compounding.
If you remove them now, the future growth reduces.

Also, shifting at low returns locks your loss temporarily.
This reduces your recovery scope.
Equity demands patience.
Shifts should happen only for category change or goal change.
Not due to early low return.

Your existing stable funds are strong.
But your new SIPs are young.
They must complete a cycle.
Give them time.
Let them build track record.
Let them grow into their natural cycle.

So shifting is not needed now.
Holding is better.
This protects your asset spread.
This protects your future upside.

» What You Can Do Instead of Shifting

– Keep the SIP amounts running in all categories.
– Do not stop a SIP only because returns look low.
– Give new SIPs time to settle.
– Keep your existing strong funds as anchors.
– Let the new SIPs grow slowly with the cycle.

This approach keeps your long-term path strong.
Your risk stays balanced.
Your return potential stays high.
Your peace remains intact.

» Your Large Cap SIP

Your large cap SIP shows stable long-term return.
Large caps protect you during market shocks.
They give consistent strength.
This SIP can stay as it is.
Your amount here is healthy.

Large caps will never give small cap-style jumps.
But they give backbone strength.
You already enjoy that.
So no change needed here.

» Your Large and Mid Cap SIP

This category is good for balanced growth.
It gives both stability and speed.
Your return is strong due to long holding period.
This SIP is a pillar in your mix.
You can continue this SIP.

This category sometimes outperforms large caps.
Sometimes mid caps inside it push growth.
So it gives a smooth growth curve.

» Your Long-Term Flexi Cap SIP

A flexi cap fund adjusts allocation based on market cycles.
This gives natural balance.
Your return shows good long-term compounding.
This SIP is valuable for long-term wealth.
Keep this running as well.

Flexi cap gives freedom to move across market caps.
This helps during tough cycles.
This helps during opportunity cycles.

» Your Earlier Small Cap SIP With Good Return

Your long-running small cap SIP is solid.
The return shows full cycle benefit.
This proves that small caps need time.
You have seen both low and high phases.
And it rewarded you well.
This is the best example for your new SIPs.

This SIP also gives high long-term power.
Small caps grow faster when held long.
This SIP should continue.
It strengthens your return potential.

» Your Three New SIPs With Low Returns

These SIPs look weak now.
But they are too new.
They cannot show long-term truth yet.
Please wait.
Please continue.
They will settle.
They will show their cycle strength later.

Stopping now may disturb your mix.
Stopping now may cut your chance for higher future returns.

So I advise to continue them.
Let them complete three to five years.
Then review again.

» Your Lump Sum in PSU Theme

Your PSU-themed lump sum works like a cyclical idea.
It grows well during reform cycles.
It grows during strong government policy cycles.
You hold it for a short time now.

The return is decent for a short period.
But this category is not stable always.
It moves in waves.
So you must keep moderate expectations.
Don’t expect smooth returns here.
Hold it medium term.
Do not add more now.
Let it run on its own.

Review after three years.
Keep it as a satellite portion of your total.

» Your Lump Sum in Flexi Category

This fund gives broad market coverage.
Your return is good.
Flexi cap works well when markets shift directions.
Hold this for long term.
It suits broad-based wealth creation.

No need to redeem.
No need to shift.
Let it stay and grow steady.

» Your Lump Sum in Emerging Category

This category grows when domestic and global cycles favour growth-oriented companies.
Your return is strong.
This shows the category is working well.

Hold it for long term.
Do not disturb it.
Allow more compounding.
It can support high capital appreciation.

» Why Active Funds Give Better Scope Than Index Funds

Index funds track the market.
They cannot beat the market.
They cannot avoid weak companies inside the index.
They cannot manage risk actively.
They cannot adjust during market shocks.
They cannot shift between sectors based on cycle.

Active funds can do all these.
Active funds can remove weak stocks.
Active funds can allocate more to strong sectors.
Active funds can reduce risk quickly.
Active funds can capture opportunities early.
Active funds give better long-term power.
So your active fund choices are suitable.

» Why Regular Plans Are Better Than Direct Plans

Regular plans come with guidance.
They give you clarity.
You get support in reviews.
You get a Certified Financial Planner’s view.
You get timely corrections.
You get emotional support in volatile cycles.

Direct plans give no such support.
Direct plans leave you alone during tough times.
Direct plans become risky without guidance.

So regular plans are better for your long-term journey.

» Cash-Flow Comfort and Mental Comfort

Your SIP size is strong.
Ten thousand rupees across many categories builds big wealth.
But make sure it fits your cash flow.
You should not feel pressure.
Your SIP should feel natural.
Not heavy.
Not stressful.

Mental comfort is important.
If you worry too much about short-term returns, you may take wrong actions.
Please see equity as a long-term partner.
Short-term pain is normal.
But long-term gain is powerful.

» Risk Spread Across Your Portfolio

Your portfolio is spread well across five categories.
Large cap gives stability.
Flexi cap gives balance.
Large and mid cap gives smooth growth.
Mid cap gives speed.
Small cap gives high compounding.
PSU gives exposure to government-linked sectors.
Emerging category gives future growth trends.

This spread supports your long-term safety.
This gives you a full 360-degree structure.
This helps you handle all cycles.

» How to Review in Future

Review once a year.
Not every month.
Not every quarter.
One year gives clear signals.
Short periods give noise.

Check only category-level changes.
Do not react to short-term low returns.
Do not shift during weak phases.
Shift only when your goals or risk levels change.

» Finally

Your portfolio is strong.
Your commitment is strong.
Your categories are balanced.
Your lump sum part is fine.
Your weak SIPs only look weak because they are new.
They need time.
Do not shift them now.
Let all your SIPs continue.
This will build wealth in the long run.
You are on the right direction.
Stay steady.
Stay patient.
Stay invested.

Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

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

Ans: You have explained your income, goals, current assets, and future plans with great clarity. Your early planning spirit is strong. This gives a very good base. You can reach a peaceful retirement with smart steps in the next few years.

» Your Current Position

You are 40 years old. You plan to retire in 3 to 5 years. You earn Rs 2.3 lakh per month. Your wife also works but will stop working soon. You have one daughter aged 10. Your current monthly cost is around Rs 1.1 lakh. This cost will reduce after retirement because you will shift to your parental flat.

Your investment base is already good. You have saved in bonds, stocks, mutual funds, PPF, FD, and SIP. Your wife also has her own savings and rental income from a flat. All these create a good starting point.

This early base helps you plan stronger. It also gives room for more shaping. You are on the right road.

» Your Family Goals

You need Rs 75 lakh for your daughter’s higher education and marriage.

You want Rs 75,000 per month for family living after retirement.

You want to retire in 3 to 5 years.

You will shift to your parental flat after retirement.

You will have rental income of Rs 10,000 from your wife’s flat.

These goals are clear. They give direction. They allow a strong plan.

» Your Present Investments

Your investments include:

Rs 50 lakh in REC bonds maturing in 2029.

Rs 42 lakh in stocks.

Rs 17 lakh in mutual funds.

Rs 16 lakh in fixed deposits.

Rs 15 lakh in PPF.

Rs 1.3 lakh as monthly SIP.

Your wife holds:

Rs 30 lakh corpus.

A flat worth Rs 40 lakh with rent of Rs 10,000 each month.

Your combined net worth is healthy. This gives good power to build your retirement fund in the coming years.

» Understanding Your Expense Need After Retirement

You expect Rs 75,000 per month after retirement. This includes all basic needs. You will not have rent. That reduces cost. This assumption looks fair today.

Your cost will rise with inflation. So you must plan for rising needs. A strong retirement corpus must support rising cost for 40 to 45 years because you are retiring early.

An early retirement needs a large buffer. So you need safety along with growth. Your plan must include growth assets and safety assets.

» How Much Monthly Income You Will Need Later

Rs 75,000 per month is Rs 9 lakh per year. In future years, this cost can rise. If we assume steady rise, your future cost will be much higher.

So the retirement corpus must be designed to:

Give monthly income.

Beat inflation.

Support you for 40 to 45 years.

Protect your family even in market down cycles.

Allow flexibility if your needs change.

A strong retirement fund must support both safety and long-term growth.

» How Much Corpus You Should Target

A safe target is a large and flexible corpus that can support long years without running out of money. For early retirement, the usual thumb rule suggests a very high number. This is because you need income for many decades.

You need a corpus big enough to produce rising income. You also need a cushion for unexpected health costs, lifestyle shocks, and inflation changes.

Your target retirement corpus should be in a strong range. For your needs of Rs 75,000 per month and for goals like daughter’s education and marriage, you should aim for a combined retirement readiness corpus in the higher bracket.

A safe range for your family would be a very large number crossing multiple crores. This large range gives you:

Income safety.

Inflation protection.

Peace during market cycles.

Comfort in long life.

Room for daughter’s future.

Strong backup for health.

You are already on the way due to your existing assets. You will reach close to this range with systematic building over the next 3 to 5 years.

» Why You Need This Larger Corpus

You will retire early. That means more years of living from your corpus. Your corpus must not fall early. It must grow even after retirement. It must give monthly income and long-term family protection.

This is only possible when the corpus is strong and well-structured. A weak corpus creates stress. A strong corpus creates freedom.

Also, your daughter’s future cost must be kept aside. This must be parked in a separate fund. This must not touch your retirement money.

A strong corpus makes these two worlds separate and safe.

» Your Existing Assets and Their Strength

You already have good diversification:

Bonds give safety.

Stocks give growth.

Mutual funds give managed growth.

FD gives stability.

PPF gives tax-free long-term savings.

This blend is already a good start. But you need to make the blend more structured for early retirement.

Your Rs 1.3 lakh monthly SIP is also strong. It builds your future fast. You should continue.

Your wife’s rental income is small but steady. This adds strength.

Your combined financial base can reach your retirement target if you refine your allocation now.

» Your Daughter’s Future Fund Need

You need Rs 75 lakh for your daughter’s education and marriage. You should keep this goal separate from your retirement goal.

Your current SIP and future allocations should create a dedicated fund for this goal. A long-term fund can grow well when managed actively.

Do not mix this fund with your retirement needs. Mixing leads to shortage in old age. Always keep this corpus ring-fenced.

» A Strong Asset Mix For Your Retirement Path

A balanced mix is needed. You need growth assets to beat inflation. You also need stable assets for income.

You must avoid index funds because they do not give flexibility. Index funds follow a fixed index. They cannot make active changes in different markets. They cannot move to better stocks when markets change. They force you to stay in weak sectors for long. They also do not help you in down cycles because they cannot protect you by shifting to safer options. This can hurt retirement planning.

Actively managed funds are better because:

They give active asset selection.

They give scope for better returns.

They give flexibility to change sectors.

They give downside management.

They give access to a skilled fund manager.

They support long-term planning more safely.

Direct plans also carry risk. Direct plans do not give guidance. They do not give behavioural support. They do not give market timing help. They do not give portfolio shaping. They leave all the judgement to you. One mistake can cost years of wealth.

Regular plans with guidance from a Certified Financial Planner help you shape decisions. They help you remain disciplined. They help you avoid panic. They help you decide allocation changes at the right time. This saves wealth in long-term.

» How Your Investment Journey Should Grow in the Next 3–5 Years

Continue your SIP.

Increase SIP when your income rises.

Shift part of your stock holding into planned long-term mutual funds to reduce concentration risk.

Build a defined daughter’s education fund.

Keep a part of your REC bond maturity amount for long-term.

Avoid locking too much into fixed deposits for long periods.

Build a safety fund for one year of expenses.

This will create a full structure.

» Your Rental Income Role

Your rental income of Rs 10,000 per month is small but steady. Over time it will rise. This income will support your monthly cash flow after retirement.

You can use this for utilities or health insurance premiums. This gives a cushion.

» Your Emergency Buffer

You should keep at least one year of essential cost in a safe place. This can be in a liquid account or short-term fund. This protects you in shocks.

Since you plan early retirement, a strong buffer is important. It gives peace even in low months.

» A Structured Retirement Approach

A complete retirement plan for you should include:

A clear monthly income plan after retirement.

A corpus that can grow and protect.

A rising income system that matches inflation.

A separate daughter’s future fund.

A health cover plan for your family.

A tax-efficient withdrawal plan.

A market cycle plan to protect you in tough times.

This holistic approach keeps your family strong for decades.

» What You Should Build by Retirement Year

Your aim should be to reach a strong multi-crore range in investments before retirement. You already hold a large amount. You will add more in the next 3 to 5 years through SIP, stock growth, bond maturity, and disciplined saving.

Once you reach your target range, you can start the shifting process:

Move a part to stable assets.

Keep a part in long-term growth assets.

Create a monthly income strategy.

Keep a reserve bucket.

Keep a child future bucket.

Keep a long-term growth bucket.

This structure protects you in all market conditions.

» Final Insights

Your financial journey is already strong. You have a good income. You have saved well. You have multiple asset types. You have a clear timeline. And you have clear goals. This foundation is solid.

In the next 3 to 5 years, your focus should be on growing your combined corpus to a strong multi-crore range, keeping a separate fund for your daughter, reducing risk in unplanned assets, and building a stable long-term structure.

With the present path and a disciplined structure, you can retire peacefully and support your family with confidence for many decades.

Best Regards,

K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

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