Hello Sir, i am 34 yrs now and invested in mutual funds from more than 2 and half yrs and its current value is 2.5 lakh and ppf with value 3 lakh and stocks worth 2 lakhs. I am also invested in ulip for 1 lack per annum 5 years and its current value is 7.2 lakh. If i invest in mutual funds(10000 per month) till 55 yrs how much corpus will i get?

Ans: To estimate your corpus after 7 to 8 years, let's assume an average annual return on your mutual fund SIPs at 10-12% and a similar return on your other investments.

For Mutual Funds:

Future Value of Current Investments: Using the future value formula, considering an average return of 10-12%, your current 1.09 crore can grow to approximately 2.2 - 2.5 crores in 7-8 years.
Future Value of Additional SIPs: Investing 35k per month for 7-8 years, at an average return of 10-12%, you could accumulate around 50 - 60 lakhs from SIPs alone.
For Other Investments:

Future Value of Current Investments: Assuming an average annual return of 10-12%, your current 1 crore can grow to approximately 2 - 2.4 crores.
Future Value of Additional Investments: With 80k monthly investments for 7-8 years, at an average return of 10-12%, you could accumulate around 1.5 - 1.8 crores.
Total Corpus After 7-8 Years: Combining both, your total corpus could range from 5.2 - 6.2 crores.

Retirement Planning:
Considering your monthly expense is 1 lakh, with a corpus of 5.2 - 6.2 crores, you can generate approximately 40-50k per month (assuming a 7-8% withdrawal rate) post-retirement. This should be sufficient considering your current expenses, but inflation and unforeseen expenses should also be considered.

It's advisable to consult a financial advisor for a detailed plan tailored to your needs, considering inflation, tax implications, and other factors.

Ans: It is really great to see that you have started to plan for your post-retirement life and you have accumulated ample amount till now.

If you continue in the same way with a monthly SIP of Rs. 80,000, I am convinced that you will have enough corpus to support yourself throughout retirement.

Accumulated corpus in 8 years with monthly investment of 80,000 and present value 1.09 Crore will likely be 4.12 Crores. Rate of return considered for the calculation is 12% CAGR.

Assuming that you want to maintain your current monthly expense of ₹1 lakh in retirement, it is important to factor in inflation, which will erode the value of your money over time.

Since you have other avenues as well to support your expenses, this will help to create a heftier corpus.

Recommendations:
• Invest in a mix of equity and debt mutual funds to diversify your portfolio and reduce risk.
• Rebalance your portfolio regularly to maintain your appropriate asset allocation as per your requirement.
• Consult with a financial advisor to develop a comprehensive retirement plan.

Ans: You are on the right track Subho. Longevity has increased. Post-retirement risk free interest rate has come down. Inflation has gone up.

So when planning for retirement corpus, back-of-the-envelope calculations won't work. You need to project your financial life from now to retirement and retirement to life expectancy. If it is not possible for you to do that, then approach a financial planner who will be able to create a financial roadmap.

Ans: Current Investment Portfolio and Future Contributions

Your proactive approach to investing is commendable. With a monthly SIP of Rs. 35,000 since 2013 and a current market value of Rs. 1 crore 9 lakhs in mutual funds and SIPs, you've laid a strong foundation.

Planning to continue investing Rs. 35,000 per month for the next 7 to 8 years adds substantial potential to your corpus.
Estimated Corpus in 7 to 8 Years

With an average annual return of approximately 12%, your additional monthly investments can significantly enhance your corpus over the specified period.

Although exact projections require detailed calculations, leveraging the power of compounding through regular investments can substantially boost your overall wealth.

Total Corpus Including Other Investments

In addition to mutual funds, you've wisely diversified your portfolio with approximately Rs. 1 crore invested in avenues like Voluntary Provident Fund, EPF, PPF, ESOPs, and pension funds.

Factoring in the growth potential of these investments alongside your mutual funds, your total corpus after 7 to 8 years could be substantial.
Evaluation of Retirement Readiness

Considering your current monthly expenses of Rs. 1 lakh, it's essential to assess whether your projected corpus would adequately support your retirement lifestyle.

Based on your anticipated corpus after 7 to 8 years and your monthly expenses, you appear to be on track for a comfortable retirement. However, regular reviews of your financial plan are crucial to ensure alignment with your retirement goals.
Final Thoughts

Your disciplined approach to savings and investments, coupled with a diversified portfolio, positions you well for a financially secure retirement. Continuously monitor your financial plan and make adjustments as needed to stay on course.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

Ans: You are investing Rs.77,000 monthly across various mutual fund schemes.

You’ve completed 2 years. You plan to continue for 10 more years.

You want to know two key things:

How much corpus can you expect after 10 years?

How to reach your target of Rs.3 crores?

Let us explore this in detail with a professional and 360-degree view.

I’ll write this in a simple tone with short sentences, as per your guidance.

Let’s begin.

Your Current Investment Summary

You are investing Rs.77,000 monthly in mutual funds.

You’ve done this consistently for the last 2 years.

You’re planning to continue for another 10 years.

Your current SIPs are spread across large cap, mid cap, sectoral, ELSS and global funds.

That shows discipline and commitment. Appreciate your long-term vision.

This strategy gives long-term compounding benefit.

Diversification across sectors also helps reduce some risk.

But too many funds may reduce effectiveness.

Expected Corpus in 10 Years with Current SIPs

If you continue Rs.77,000 monthly for the next 10 years…

And assuming average returns around 11% to 12% per year…

Your total corpus may become between Rs.1.60 crores to Rs.1.75 crores.

This is over and above the Rs.20 lakhs already invested in the last 2 years.

Including the existing corpus, your total may reach Rs.2.10 to Rs.2.25 crores.

This is a good base, but still short of Rs.3 crore target.

There is a gap of about Rs.75 lakhs to Rs.90 lakhs.

That gap needs to be addressed carefully.

How Much More is Required to Reach Rs.3 Crores

You need to increase your monthly SIP.

Increasing SIP by Rs.20,000 to Rs.25,000 monthly can help bridge the gap.

Even a 10% annual SIP step-up can accelerate growth.

But it must be sustainable and consistent.

Avoid large fluctuations in SIP values every year.

Ideal SIP Amount to Target Rs.3 Crores

For a target of Rs.3 crores in 10 years…

You may need to invest about Rs.95,000 to Rs.1,00,000 monthly.

You are already investing Rs.77,000. So only Rs.18,000 to Rs.23,000 more is needed.

If income grows yearly, increase SIPs by 10% annually.

This method works better than one-time increase.

Gradual increase suits most investors mentally and financially.

Assessment of Fund Category Mix

Your current funds include many sectoral schemes.

Sector funds carry higher risk and volatility.

Overexposure to such funds may reduce consistency.

You also have multiple midcap funds.

While midcaps give growth, they can fall sharply in downturns.

A balanced mix of large cap, flexi cap, and mid cap is better.

You may reduce sectoral funds and focus more on diversified categories.

Suggestion: Trim the Number of Funds

You have more than 12 mutual fund schemes now.

This leads to portfolio overlap and confusion.

Fund performance becomes difficult to track.

Too many schemes also duplicate stocks.

Best is to keep only 5 to 7 well-selected schemes.

Choose those which consistently beat benchmarks over 5+ years.

Keep them from different categories for better balance.

Keep More in Diversified Equity Funds

Avoid high allocation to thematic or sector-specific funds.

Sectors like defence, infrastructure, digital, PSU are cyclical.

They don’t perform all the time.

For long-term wealth, diversified funds work better.

Flexi cap and multi-cap funds adapt better to market cycles.

You may retain 1 sectoral fund, but not more than that.

Over-diversification in sectors reduces stability.

Avoid Index Funds Completely

Index funds are passive. They copy market index.

They don’t aim to beat returns.

In India, active funds often outperform index funds.

Also, index funds fail in sideways or falling markets.

They don’t protect downside.

Expense ratio may be low, but so are returns.

With Certified Financial Planner and MFD, regular funds give better support.

Active funds have dynamic portfolio management.

Stick to Regular Mutual Funds Through MFDs and CFPs

Direct funds may seem cheaper. But they lack guidance.

Most investors make wrong entries and exits in direct funds.

They often get average or below-average returns.

With regular funds via MFD and CFP, advice is continuous.

Emotional handholding is equally important as returns.

CFPs also monitor rebalancing, asset allocation, and fund changes.

They help you stay on track in volatile markets.

Taxation of Mutual Funds Must Be Understood

Under new rules, equity fund LTCG above Rs.1.25 lakhs is taxed at 12.5%.

Short term gains (less than 1 year) taxed at 20%.

So, long holding period is good.

Avoid frequent switches or redemptions.

SIPs older than 1 year become tax efficient.

Maintain SIPs minimum 5 to 7 years for optimal results.

Strategy to Reach Rs.3 Crore in 10 Years

Increase SIP to Rs.95,000 to Rs.1 lakh monthly.

Stick to 5 to 7 diversified equity funds only.

Remove excess sectoral and overlapping schemes.

Add flexi cap, large and midcap, and ELSS for discipline.

Review performance once in a year with your CFP.

Step up SIPs by 10% annually, if income allows.

Reinvest all dividends and don’t withdraw midway.

Track fund consistency, not just recent returns.

Invest only through CFP-led MFD platforms for better behaviour tracking.

Avoid These Common Mistakes

Don’t stop SIPs in falling markets.

Don’t chase short-term top-performing funds.

Avoid direct mutual funds without proper tracking.

Don’t rely heavily on infrastructure, defence or PSU funds.

Don’t withdraw unless it’s an emergency.

Don’t compare portfolio with friends or relatives.

Monitor Investment Journey Yearly

Check corpus progress every 12 months.

Ensure you’re on track to Rs.3 crore.

Your CFP can use goal-tracking tools to assist.

Adjust funds if performance drops consistently.

Don’t panic over short-term falls.

Keep long-term mindset always.

Keep updating your KYC, FATCA, nominee details yearly.

Stay invested through all market cycles.

Behavioural Discipline is More Important Than Fund Selection

Even best fund can’t deliver if you stop SIPs halfway.

Behaviour matters more than timing or fund choice.

Investing monthly is already a big success.

Staying for 10 years multiplies your advantage.

Role of Emergency Fund and Insurance

Keep Rs.3 to Rs.6 lakhs as emergency fund.

Don’t touch mutual funds for short-term needs.

Have Rs.10 lakh health insurance and term insurance of Rs.1 crore minimum.

This protects your SIPs in emergencies.

Review insurance covers every 2 years.

Finally

You are already on a strong path with Rs.77,000 SIP.

Just increase it by Rs.20,000 monthly to target Rs.3 crores.

Avoid holding too many funds. Keep it focused and diversified.

Say no to index and direct funds.

Stick to regular plans with Certified Financial Planner support.

Remove excess sectoral allocation. Stay with core categories.

Review annually with your CFP. Adjust if needed.

Don’t lose focus in market corrections.

Rs.3 crores is very much achievable with these steps.

Stay consistent. Stay informed. Stay disciplined.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

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