I am a govt servent with cash in hand salary about INR 80,000/- my age is 34. And i have just started to invest in share market. I want to invest 50,000/- per month please suggest me.

Ans: Hello Rajshekhar,

Thank you for reaching out to me for advice on your investment plan. As a financial advisor, I understand your desire to invest 50 lakhs and generate a monthly income of 35,000 rupees. It's great that you have other sources of income amounting to 20,000 rupees per month.

Firstly, I would like to suggest that you diversify your investment portfolio across different asset classes, such as equity, debt, and gold, to minimize risk and maximize returns. While there are several investment options available in the market, I recommend considering SWPs (Systematic Withdrawal Plans) on mutual funds as an option to generate monthly income.

SWPs provide a steady stream of income while allowing you to keep your invested capital intact. They work by allowing you to withdraw a fixed amount from your mutual fund investment periodically. The withdrawal amount is based on the performance of the mutual fund and can be adjusted based on your income requirements.

It's important to note that while mutual funds can provide good returns over the long-term, they come with a certain level of risk. Therefore, it's crucial to invest in mutual funds that match your risk profile and financial goals.

I hope this advice helps you in planning your investments and achieving your financial goals. Good luck with your investment journey!

Ans: If you remain consistent, invest with a minimum 5 years’ horizon and do not get swayed by market fluctuations, equity will create wealth for you.

I would not recommend you to go in for any direct equity portfolio – as such it would be difficult to do so with Rs 5000 a month. I would recommend the allocation of following categories of funds for SIP for you, one fund per category (total 4 funds):-
1. Index Fund – 40%
2. Flexicap Fund – 20%
3. Large and Midcap Fund – 20%
4. Asset Allocator Fund – 20%

How to choose the fund? Go to any popular website which will give you comparison of various funds and simply choose a 5-Star fund, necessarily the best fund of the above categories. Then choose an investing platform and go ahead with investing.

Ans: Investing 50,000 per month for your retirement is a prudent decision. Here's a general approach you can consider:

Determine Investment Horizon: Since retirement is typically a long-term goal, it's essential to identify your investment horizon. Given your age of 34, you may have a retirement horizon of around 25-30 years.

Asset Allocation: Based on your risk tolerance and investment horizon, consider allocating your investment across different asset classes such as equity, debt, and potentially other assets like real estate or gold. A common rule of thumb for long-term goals like retirement is to have a higher allocation to equity for growth potential.

Equity Investments: Allocate a significant portion of your investment towards equity mutual funds. You can diversify across large-cap, mid-cap, and small-cap funds to spread the risk and maximize growth potential. Consider both diversified equity funds and sector-specific funds based on your risk appetite.

Debt Investments: Allocate a portion of your investment towards debt mutual funds for stability and regular income. Debt funds can provide capital preservation and generate steady returns over the long term. Consider options like dynamic bond funds, short-term funds, or gilt funds based on your risk profile.

Systematic Investment Plan (SIP): Consider investing through SIPs to benefit from rupee cost averaging and mitigate the impact of market volatility. SIPs allow you to invest a fixed amount regularly in mutual funds, regardless of market conditions.

Review and Rebalance: Regularly review your investment portfolio and rebalance it if needed to ensure it remains aligned with your financial goals and risk tolerance. Rebalancing involves adjusting your asset allocation based on market movements and changes in your investment objectives.

Consult a Financial Advisor: Consider seeking guidance from a certified financial advisor who can help you create a personalized investment plan tailored to your financial goals, risk profile, and investment horizon.

Remember, investing for retirement is a long-term commitment, and consistency, discipline, and patience are key to achieving your financial objectives.

Ans: Consider a diversified approach with a mix of large-cap, mid-cap, and flexi-cap mutual funds to spread risk across different market segments. Ensure funds have a track record of consistent performance and align with your risk tolerance and investment horizon. Consulting a financial advisor can provide personalized recommendations based on your financial goals and risk profile.