Hello Sir, myself Venkatesh aged 35 working in PSU current monthly takehome salary is Rs.1.20lac investing Rs.1,50,000/- in PPF per annum, havings corpus in fixed deposits around Rs.30lacs, investing in Mutual funds through monthly SIP of Rs.8000/- in three funds from past 3years 1.Parag Parikh Flexi Cap Fund-Reg(G)- 3K 2. Mirae Asset Large Cap Fund-Reg(G)- 3K 3. Axis Focused 25 Fund-Reg(G)- 2K. Now i want to invest another Rs.15,000/- per month for 18-20years and also advise by what amount i can stepup my existing portfolio for better returns.

Ans: Rs 1,20,000 investment in equity oriented funds per month is required to create a corpus of Rs 3 cr in 10 years.

Both schemes of Axis and Mirae along with Kotak Nasdaq are good schemes to be continued

Debt funds will not be able to generate the kind of returns required to achieve the corpus

Ans: Dear Sukhvinder,

Thanks for asking about your financial goals. You have been investing INR 45,000 each month for the last three years and want to reach INR 3 crores in the next 10 years. Let's see if that's possible, considering your past investments.

Assuming you've earned an average return of 12% per year (which is a good estimate for a diverse set of investments), the amount you've already invested in the past three years should be around INR 21.6 lakhs. If you keep investing INR 45,000 each month for the next 10 years and continue to earn 12% per year, you'll have about INR 1.08 crores in 10 years. Adding the past investments to this amount, you'll have around INR 1.29 crores in total.

To reach your target of INR 3 crores, you'd need to earn around 23% per year, which is very high and not very likely. One way to get closer to your goal is to invest more each month. If you increase your monthly investment to INR 75,000 and still earn 12% per year, you could have around INR 1.80 crores in 10 years. Adding your past investments, you'll have about INR 2.01 crores in total. It's not INR 3 crores, but it's more realistic given the risks involved.

Your current investments include a mix of midcap, flexicap, large-cap, and hybrid funds, which is good. But it's important to keep an eye on how each fund is performing compared to others in the same category. If any of your funds aren't doing well, think about switching to better ones.

In the end, reaching INR 3 crores in 10 years might not be possible with your current investments and a 12% return. But by investing more each month and keeping your investments diverse, you can still build a good amount of savings. Make sure to review your investments regularly and make changes as needed.

Best of luck on your financial journey!

Warm Regards,
Hardik Parikh

Ans: Dear Venkatesh,

Thank you for sharing your financial details and investment strategy. Your disciplined approach towards saving and investing is commendable, and it's great to see your proactive efforts towards planning for the future.

Considering your current financial situation and goals, here's a suggested plan for investing an additional ?15,000 per month and optimizing your existing portfolio:

New Investment of ?15,000 per Month:

Given your investment horizon of 18-20 years, you have the opportunity to invest in equity-oriented mutual funds to potentially achieve long-term growth.
Since you already have exposure to flexi-cap, large-cap, and focused equity funds, you can consider diversifying further by investing in mid-cap or multi-cap funds to capture opportunities across different market segments.
Allocate the additional ?15,000 per month across 2-3 mutual funds to ensure proper diversification and mitigate risk.
Portfolio Step-Up:

Evaluate the performance of your existing SIPs in Parag Parikh Flexi Cap Fund, Mirae Asset Large Cap Fund, and Axis Focused 25 Fund.
Consider increasing your SIP contributions gradually over time to capitalize on the power of compounding and accelerate wealth accumulation.
Utilize the step-up SIP feature offered by mutual fund platforms to automatically increase your SIP amounts by a predefined percentage or fixed amount annually.
Review your portfolio periodically and adjust your SIP contributions as needed to stay aligned with your investment goals and risk tolerance.
Regular Review and Rebalancing:

Periodically review your investment portfolio and asset allocation to ensure that it remains aligned with your financial goals and risk tolerance.
Rebalance your portfolio as needed to maintain your desired asset allocation and optimize returns. This involves selling overperforming assets and reinvesting the proceeds into underperforming or undervalued assets.
Consultation:

Consider consulting with a qualified financial advisor who can provide personalized guidance tailored to your financial objectives and risk profile.
An advisor can help you assess your current portfolio, identify any gaps or areas for improvement, and recommend suitable investment options to achieve your long-term financial goals.
By following these steps and staying disciplined with your investment strategy, you can work towards building a strong financial foundation and achieving your financial aspirations.

Best regards,

Ramalingam, MBA, CFP
Chief Financial Planner