Hi am 35 years ,with income of 1.5lak per month..I have 15lak in shares , 7 lak in mutual fund as sip invested 3 to 4 thousand in each fund ( regular and index funds) ,7lak in gold bond , 16lak in gold, LIFE INSURANCE -pli of 20lak ( 6.7k /month) , ICICI PRUDENTIAL (1LAK/ YEAR), TATA AIA (4k/month), NPS 2lak( monthly 18k ),9lak in monthly income scheme which gets 5550 investing that into my daughter sukanya samruddhi yogana,FD of 5lak .....I need a corpus of 4 to 5 crore in next 10year ...I have monthly expenses of 20 to 30k please guide me
Ans: Assessing Your Financial Goals
Introduction
You have a strong income and diversified investments. Achieving a corpus of ?4-5 crore in 10 years is ambitious but feasible with strategic adjustments.
Current Investments
Shares: ?15 lakh
Mutual Funds (SIP): ?7 lakh
Gold Bonds: ?7 lakh
Physical Gold: ?16 lakh
Life Insurance (PLI): ?20 lakh (?6.7k/month)
ICICI Prudential: ?1 lakh/year
Tata AIA: ?4k/month
NPS: ?2 lakh (?18k/month)
Monthly Income Scheme: ?9 lakh (?5550/month reinvested in Sukanya Samriddhi Yojana)
Fixed Deposit: ?5 lakh
Monthly Expenses and Income
Monthly Income: ?1.5 lakh
Monthly Expenses: ?20-30k
Investment Strategy
Surrender Unnecessary Insurance Policies
Insurance policies like PLI, ICICI Prudential, and Tata AIA may not yield high returns. Consider surrendering these and redirecting the funds to higher-yield investments.
Enhance Mutual Fund Investments
Regular and index funds are a good start. Actively managed mutual funds can offer higher returns than index funds. Focus on diversifying across equity and debt funds.
Increase SIP Contributions
Increase your SIP investments gradually. Start with an additional 10-15% increase and review every 6 months.
Maximise NPS Contributions
NPS offers good returns and tax benefits. Continue the ?18k/month contribution and increase if possible.
Reinvesting Surrendered Insurance Funds
Mutual Funds
Redirect funds from surrendered insurance policies to mutual funds. Choose a mix of large-cap, mid-cap, and small-cap funds.
Equity Investments
With ?15 lakh already in shares, consider blue-chip stocks for stability and growth. Diversify across different sectors.
Debt Investments
Maintain a portion of your portfolio in debt instruments for stability. Consider debt mutual funds or fixed deposits.
Monitoring and Rebalancing Portfolio
Regular Reviews
Review your portfolio quarterly. Ensure your investments align with your risk tolerance and goals.
Adjust Allocations
Adjust your allocations based on market conditions. Increase exposure to equities in a growing market and shift to debt in volatile times.
Planning for Corpus Growth
Targeted Growth Rate
Aim for a balanced portfolio with an average return of 10-12% annually. Equity investments should drive growth, while debt instruments provide stability.
Reinvestment of Returns
Reinvest all returns and dividends. Compounding will significantly boost your corpus over time.
Achieving Your Goal
Projected Corpus
With disciplined investing and strategic adjustments, reaching ?4-5 crore is achievable. Utilize the power of compounding and regular contributions.
Avoid Real Estate
Real estate may not provide liquidity and returns comparable to equities and mutual funds. Focus on market-linked instruments.
Final Recommendations
Consult a CFP
Regular consultations with a Certified Financial Planner (CFP) will help fine-tune your strategy and keep you on track.
Stay Disciplined
Maintain your investment discipline. Avoid impulsive decisions based on market fluctuations.
Conclusion
Your financial foundation is strong, and with strategic adjustments, your goal of ?4-5 crore in 10 years is achievable. Focus on high-yield investments, regular reviews, and disciplined investing.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in