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Ulhas

Ulhas Joshi  | Answer  |Ask -

Mutual Fund Expert - Answered on May 16, 2023

With over 16 years of experience in the mutual fund industry, Ulhas Joshi has helped numerous clients choose the right funds and create wealth.
Prior to joining RankMF as CEO, he was vice president (sales) at IDBI Asset Management Ltd.
Joshi holds an MBA in marketing from Barkatullah University, Bhopal.... more
SANTOSH Question by SANTOSH on May 12, 2023Hindi
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Sir, I have been investing in SIP for 6 years in the following schemes with an monthly sip of 5000 each. My question is should I continue with the scheme or any changes or correction is to be made in the same. 1) UTI Flexi Cap Fund (Formerly Known as UTI Equity Fund Direct Plan and Growth total investment amount as on todays date is 3,70,000/ 2) ICICI Prudential Blue Chip Fund Direct Plan Growth total investment amount Rs. 3,60,000/ 3) ICICI Prudential Nifty Next 50 Index Fund Direct Plan Growth total investment amount Rs. 1,15,000/ Intention to invest is for long term with good reasonable returns. Pls advise on the same

Ans: Hi Santosh, thanks for writing to me. You can continue investing in UTI Flexi Cap Fund and ICICI Blue Chip Fund as they are good funds. You can consider stopping investments in ICICI Prudential Nifty Next 50 Fund and begin investing the SIP amount in Nippon India Multi Asset Fund.
DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Users are advised to pursue the information provided by the rediffGURU only as a source of information to be as a point of reference and to rely on their own judgement when making a decision.
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Ramalingam Kalirajan  |9470 Answers  |Ask -

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Hello Hardik, Iam 40 Years and have started investing in SIP for the past 6 months.Below are my monthly investment 1. Parag Parikh Flexi Cap Regular Growth - 3500 2. Canara Robeco Small Cap Fund Growth - 3000 3. HDFC Retirement Savings Fund Equity Growth - 3000 4. NPS - 3500 I am planning for 18 Years of investment and aiming to slowly increase the SIP to achieve corpus of 2.5-3.0 Cr. Kindly review and advice. Regards, Ram
Ans: Hi Ram,

It's great to see that you've started investing systematically towards your long-term financial goals. Here's a review of your current SIP investments:

Parag Parikh Flexi Cap Regular Growth: This fund follows a diversified approach across various market caps and geographical regions, which can provide stability to your portfolio. It's suitable for long-term wealth creation.
Canara Robeco Small Cap Fund Growth: Small-cap funds can be volatile in the short term but have the potential to offer high returns over the long term. Ensure you're comfortable with the risk associated with small-cap investments.
HDFC Retirement Savings Fund Equity Growth: This fund is designed to provide wealth accumulation for retirement. It's aligned with your long-term investment horizon and retirement goal.
NPS: The National Pension System (NPS) is a retirement-focused investment option offering tax benefits. It's prudent to contribute to NPS alongside other investments for retirement planning.
To achieve your target corpus of 2.5-3.0 Cr over 18 years, consider periodically reviewing your SIP contributions and adjusting them based on changes in your income, expenses, and market conditions. Additionally, diversify across asset classes to manage risk effectively.

As your financial goals evolve, consider consulting with a Certified Financial Planner to ensure your investment strategy remains aligned with your objectives.

..Read more

Ramalingam

Ramalingam Kalirajan  |9470 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 17, 2024

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Hii i am investing in SIP since 1 year in ICICI prudential commodities Fund direct growth Rs200 monthly, Tata digital India und direct growth Rs150 Monthly, HDFC Technology Fund direct growth Rs100 monthly, ICICI prudential Technology direct plan growth Rs100 monthly, Nippon India Pharma fund direct growth Rs300 monthly, Nippon India small cap fund direct growth Rs300 monthly, axis nifty IT index fund direct growth Rs1000 monthly, ICICI prudential bluechip fund direct growth Rs250 monthly, Aditya Birla Sun Life digital India fund direct growth Rs100 monthly, ICICI prudential NASDAQ 100index fund direct growth Rs300 monthly, HDFC transportation and logistics fund direct growth Rs200 monthly so I invested in above SIPs Total monthly i invest Rs3000 so please give me some suggestions or modifications if required
Ans: Your Current SIP Portfolio
You have been investing ?3,000 monthly across various SIPs for a year. Your chosen funds focus on technology, healthcare, commodities, and other sectors. This shows a good start towards disciplined investing.

Concentration in Technology Sector
A significant portion of your investments is in technology-focused funds. Technology funds can offer high returns but also come with high volatility.

Sector-Specific Funds
You also have investments in healthcare, commodities, and logistics funds. Sector-specific funds can be very volatile as they depend on the performance of their respective sectors.

Diversification
Your portfolio lacks diversification. Investing too much in a single sector increases risk. Diversification helps in balancing risk and returns.

Importance of Broad Market Exposure
Diversifying across different market segments reduces risk. Balanced exposure to large-cap, mid-cap, and small-cap funds is crucial. This strategy ensures you are not overly dependent on one sector's performance.

Adding Stability with Debt Funds
Including debt funds can provide stability. Debt funds offer regular returns and reduce the overall risk in your portfolio. This balance is vital for long-term growth.

Benefits of Actively Managed Funds
Actively managed funds can outperform index funds due to professional management. Fund managers actively select stocks to maximize returns. This can be advantageous, especially in volatile markets.

Disadvantages of Index Funds
Index funds mirror the market index and do not aim to outperform it. They lack flexibility in changing market conditions. Actively managed funds, on the other hand, adapt to market changes, providing better growth potential.

Direct Funds vs. Regular Funds
Direct funds have lower expense ratios but require thorough research and monitoring. Regular funds, through a Mutual Fund Distributor (MFD) with a Certified Financial Planner (CFP), offer professional guidance and management. This can be valuable for optimizing returns and managing risks effectively.

Suggested Modifications
Reduce Sector-Specific Overweight

Reduce the number of technology and sector-specific funds. This will help in balancing the portfolio and reducing sector-specific risks.

Increase Broad Market Exposure

Allocate more funds to diversified equity funds. Large-cap and multi-cap funds provide stable returns and reduce overall risk.

Include Debt Funds for Stability

Add debt or hybrid funds to your portfolio. This will provide regular returns and reduce the volatility of your overall investment.

Suggested Allocation
Technology Funds: Choose one or two funds to maintain some exposure but reduce concentration.
Broad Market Funds: Increase investment in large-cap and multi-cap funds for stable growth.
Debt Funds: Allocate a portion to debt funds for stability.
Regular Monitoring and Review
Monitor your investments regularly. Review fund performance annually and adjust your portfolio based on your financial goals and market conditions.

Conclusion
Your dedication to investing through SIPs is commendable. With a few adjustments, you can achieve a balanced and diversified portfolio. This will help you meet your long-term financial goals with reduced risk.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |9470 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jan 20, 2025

Asked by Anonymous - Jan 07, 2025Hindi
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Hello I am investing ?500/month in SBI PSU direct plan and nippon India multi cap fund. Should I continue with these investments? In addition to the above I am planning to invest ?2000 in few more SIPs. Pls suggest new SIPs My horizon is 5 years. Thanks TPG
Ans: You are currently investing Rs 500/month in SBI PSU Direct Plan and Nippon India Multi Cap Fund. Let us evaluate their suitability:

SBI PSU Direct Plan
This fund primarily invests in public sector undertakings (PSUs).
PSU sector funds are highly sector-specific, making them risky for a small, regular SIP.
Returns depend heavily on government policies and economic conditions.
Nippon India Multi Cap Fund
Multi-cap funds invest across large-cap, mid-cap, and small-cap stocks.
They offer diversification and balanced risk compared to sector-specific funds.
This fund is suitable for your 5-year investment horizon.
Recommendation:
Continue investing in Nippon India Multi Cap Fund for diversification and growth potential.
Consider switching from SBI PSU Direct Plan to a more diversified and growth-oriented equity mutual fund.
Factors to Consider for New SIPs
Before selecting new SIPs, assess the following:

1. Investment Horizon
Your 5-year horizon is relatively short for pure equity investments.
Consider hybrid or balanced funds for lower risk and consistent returns.
2. Risk Tolerance
If you can tolerate moderate risk, opt for multi-cap or large-cap funds.
Avoid small-cap or sector-specific funds for short-term goals.
3. Return Expectations
Equity funds can provide higher returns over 5 years but may face market volatility.
Balanced advantage funds or hybrid funds offer stable returns with lower risk.
4. Tax Efficiency
Equity mutual funds are taxed at 12.5% LTCG above Rs 1.25 lakh.
Balanced advantage funds are more tax-efficient than debt funds for 5 years.
Recommended SIP Categories
1. Multi-Cap or Flexi-Cap Funds
These funds invest across all market capitalisations.
They balance risk and returns, making them ideal for medium-term goals.
Include one such fund in your portfolio for diversification.
2. Large-Cap Funds
Large-cap funds invest in well-established, stable companies.
They are less volatile and suitable for a 5-year horizon.
3. Balanced Advantage Funds
These funds dynamically allocate assets between equity and debt.
They provide stability and consistent returns for medium-term goals.
4. Aggressive Hybrid Funds
These funds invest primarily in equity with a smaller allocation to debt.
They offer better returns than pure debt funds with moderate risk.
Suggested Allocation for New SIPs
Monthly SIP Amount: Rs 2,000
Multi-Cap Fund: Rs 1,000/month.
Balanced Advantage Fund: Rs 500/month.
Large-Cap Fund: Rs 500/month.
This allocation ensures a mix of growth and stability. It is also tax-efficient and aligned with your investment horizon.

Tax Considerations
Equity Mutual Funds
Gains above Rs 1.25 lakh are taxed at 12.5% LTCG.
Avoid frequent withdrawals to minimise tax liability.
Balanced Advantage Funds
These funds are more tax-efficient than pure debt funds.
Their dynamic allocation reduces risk and improves post-tax returns.
Key Recommendations
Switch from SBI PSU Fund: PSU funds are sector-specific and not ideal for short-term goals.
Continue Nippon Multi-Cap Fund: This fund aligns with your horizon and provides diversification.
Add New SIPs: Invest in multi-cap, balanced advantage, and large-cap funds.
Review Regularly: Review your portfolio every 6 months with a Certified Financial Planner.
Avoid Sector-Specific Funds: These funds are too risky for a 5-year horizon.
Final Insights
Your disciplined SIP investments are a great start. By diversifying further with multi-cap and balanced advantage funds, you can optimise your portfolio for stability and growth. Ensure regular reviews and stick to your investment horizon for the best results.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

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

..Read more

Latest Questions
Ramalingam

Ramalingam Kalirajan  |9470 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 08, 2025

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Hi Sir, I am 55 years old. from next month onwards i am planning to invest in SIP for 5 years approximately 20,000 per month and 5,000 for shares. my questions is it good idea. if yes please advice me top 8 to 10 mutual fund. thank you sir
Ans: You are 55 years old and planning to invest Rs. 20,000 monthly in mutual funds and Rs. 5,000 in shares for the next 5 years. This is a sensible move if done with clarity and proper strategy. Below is a detailed guidance from a Certified Financial Planner’s perspective, keeping in mind your age, time horizon, and financial goals.

Assessing Your Investment Decision
Investing at 55 is absolutely possible.

It’s never too late to build wealth smartly.

Five-year horizon needs careful fund selection.

At this stage, capital protection is also important.

You must balance growth with safety.

You are doing the right thing by thinking long-term.

SIPs help in rupee cost averaging over time.

Investing monthly builds good discipline and control.

Suitability of Mutual Funds for You
Mutual funds give diversification across sectors.

You can start small and grow steadily.

SIPs avoid timing the market.

Mutual funds are professionally managed.

Ideal for salaried, retired, or business people.

You get access to equity and debt both.

Perfect tool to grow wealth systematically.

Suitable for your age and risk tolerance.

Flexible and transparent investment vehicle.

Direct vs Regular Plan – Choose Wisely
Avoid direct mutual funds unless you are a pro.

Direct funds give no support or handholding.

A wrong fund choice can hurt wealth creation.

Regular funds come with service from an MFD.

Choose a MFD with CFP certification only.

They help in rebalancing and portfolio review.

At your age, personalised advice is vital.

One wrong step may take years to correct.

The small cost in regular plans is worth it.

It pays for itself through better decisions.

Equity vs Index Funds – Which is Better?
Avoid index funds in your situation.

Index funds copy the market without analysis.

They can’t protect during market fall.

Index funds fall fully with the market.

No fund manager is watching over.

Actively managed funds perform better in India.

Skilled managers pick better quality stocks.

They shift allocation during market stress.

More suitable for your limited timeframe.

Choose actively managed equity funds.

Key Areas for Your SIP Investment
You should invest across three types of funds:

Large-cap for stability

Hybrid for balance

Flexi-cap or Multi-cap for growth

Avoid small-cap or sector funds at this stage.

Focus on consistency and fund manager quality.

Choose funds with 5+ years stable record.

SIPs should reflect your goals and risk level.

Use family MFD with CFP to create a roadmap.

Suggested Diversification of Rs. 20,000 SIP
Your Rs. 20,000 SIP should be split across:

1. Large Cap Funds (Rs. 4,000)

These are less volatile.

Ideal for short-term goals.

Focused on top 100 companies.

2. Large & Mid Cap Funds (Rs. 3,000)

Balanced exposure to safety and moderate growth.

Slightly higher return potential than large caps.

3. Flexi Cap Funds (Rs. 4,000)

Gives freedom to the manager.

Can switch between large, mid, and small.

Good for long-term returns.

4. Aggressive Hybrid Funds (Rs. 3,000)

Blend of equity and debt.

Safer than pure equity.

Suitable for your age.

5. Equity Savings Funds (Rs. 2,000)

Conservative equity product.

Combines equity, arbitrage, and debt.

Lower risk. Regular income.

6. Balanced Advantage Funds (Rs. 4,000)

Dynamic mix of equity and debt.

Adjusts to market conditions.

Helps control downside risk.

Rs. 5,000 Monthly for Shares – Caution Needed
Direct stock investment needs research.

Avoid random stock tips or YouTube advice.

Start with only 1 or 2 good quality stocks.

Choose only if you understand business.

Otherwise, prefer mutual fund route.

Stocks can be highly volatile in short term.

For 5 years, stability is more important.

Build stock exposure slowly if confident.

Important Tips Before You Start
Always keep emergency fund aside.

Minimum 6 months of expenses in FD or SB.

Don’t disturb mutual funds for emergencies.

If you have insurance-cum-investment products:

ULIP or traditional LIC

Consider surrendering them after review.

Reinvest into mutual funds.

Pure term insurance + MF is better.

Taxation of Mutual Fund Returns – Know This
Equity Funds

Profits after 1 year are LTCG.

LTCG above Rs. 1.25 lakh is taxed at 12.5%.

Short-term (before 1 year) gains taxed at 20%.

Debt Funds / Hybrid with

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Ramalingam

Ramalingam Kalirajan  |9470 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 08, 2025

Asked by Anonymous - Jul 06, 2025Hindi
Money
I am planning to invest 3 lakhs per month for next 3 years (1.5 lakhs in my name and 1.5 lakhs in my wife name), I am planning to go with flexi , mid and small cap with equal investment amount for all 3. Is it good idea. My risk acceptance is from high to medium. Also suggest me which mutual funds would be better
Ans: You are planning Rs.3 lakhs per month. That’s Rs.1.5 lakhs in your name and Rs.1.5 lakhs in your wife’s name. This monthly commitment for the next 3 years is solid. It shows strong savings discipline. You deserve appreciation for taking this big step.

But, to create real wealth, how and where you invest matters more than how much you invest. Your current idea of splitting into flexi cap, mid cap and small cap equally must be properly assessed.

As a Certified Financial Planner, let’s walk through a detailed 360-degree analysis of your plan. This will cover risk, allocation, structure, fund selection, and tax aspects.

Your Portfolio Idea at a Glance

You have chosen three equity categories:

Flexi cap

Mid cap

Small cap

And you plan to split the monthly Rs.3 lakhs equally:

Rs.1 lakh to each category

For 36 months (3 years)

You mentioned your risk level is between high and medium.

Now we’ll assess if this mix supports your goals and risk profile.

Understanding the Nature of Each Fund Category

Let’s understand how these categories behave. That will help shape better allocation.

Flexi Cap Funds:

Can invest in large, mid, and small caps.

Offer flexibility based on market conditions.

Tend to carry moderate risk.

Suitable for medium to long term.

Good core holding in any portfolio.

Mid Cap Funds:

Invest in mid-sized companies.

Can offer high growth.

But volatility is more than flexi caps.

Suited for long-term investors only.

Carry moderate to high risk.

Small Cap Funds:

Invest in smaller companies.

Very high growth potential.

But very volatile and risky.

Return may take 7 to 10 years to stabilise.

Not ideal for investors with only 3 to 5 year horizon.

How Your Current Plan Matches with Risk and Tenure

You are planning this investment for 3 years. You have medium to high risk appetite.

But small cap funds require 7 to 10 years. Mid cap needs at least 5 years. Flexi cap can work well from 3 years onwards.

So, a strict 33% allocation in each of the three is not ideal for you. It adds unnecessary risk in a short-term plan. Small caps, in particular, don’t suit your 3-year goal.

This could result in:

High volatility

Poor returns at the end of 3 years

Difficulty in redeeming without losses

Better Strategy Based on Your Situation

Here’s a more stable and practical approach:

Flexi Cap Funds: 50%

Mid Cap Funds: 30%

Small Cap Funds: 20%

This balances the return and risk better. You still get growth exposure without excessive stress. This structure fits your medium-to-high risk level and 3-year investment horizon.

If your investment plan extends beyond 3 years, say 7 to 10 years, then small cap can be increased. But for now, keep it moderate.

The Importance of Active Fund Management

You didn’t mention direct or regular fund choice. So let’s address that.

If you are considering direct funds, please note the following issues:

You get no help on portfolio review.

You may miss better-performing funds.

There is no support during volatility.

Fund underperformance may go unnoticed.

Tax planning becomes harder.

In contrast, investing through regular plans with a Certified Financial Planner ensures:

Professional fund selection

Periodic review and rebalancing

Guidance during volatile periods

Tax-efficient redemption

Goal-aligned asset allocation

This is critical when investing Rs.1 crore+ over 3 years.

Why Actively Managed Funds Are Better Than Index Funds

You did not mention index funds, but it’s important to clarify.

Some people wrongly suggest index funds for all investors. But there are key disadvantages:

Index funds blindly copy the index.

No control over bad or overvalued stocks.

No downside protection.

Same stocks are repeated in multiple funds.

Not aligned with investor’s risk profile.

In contrast, actively managed funds offer:

Professional research and stock selection

Ability to avoid poor performing sectors

Better performance in volatile markets

Focus on long-term winners

For serious wealth creation, active management is essential.

Include Some Debt for Safety and Balance

Your current plan has no debt component. This increases short-term risk.

Even with high risk tolerance, some debt helps by:

Providing liquidity during emergencies

Reducing portfolio volatility

Giving funds to buy equity during dips

Creating peace of mind

You can consider:

Short-term debt funds

Dynamic bond funds

Conservative hybrid funds

Aim for 20% to 25% allocation in debt. That means about Rs.60,000 to Rs.75,000 per month.

You can adjust your equity exposure accordingly. That still keeps Rs.2.25 lakhs to Rs.2.4 lakhs per month in equity.

Should Your Wife Invest Separately or Jointly?

You are investing Rs.1.5 lakhs each in your name and your wife’s name.

This is smart from a tax and planning angle. Keep her portfolio aligned with same asset allocation. Don’t treat her plan as separate. Instead, treat both portfolios as one unit.

Benefits of this approach:

Joint planning helps in asset allocation.

Easier to track overall progress.

Better tax optimisation.

Funds can be rebalanced between both when needed.

But make sure she is comfortable with the plan. Keep her informed and involved.

Tax Planning for Equity Mutual Funds

Latest mutual fund tax rules:

LTCG on equity funds above Rs.1.25 lakh is taxed at 12.5%.

STCG is taxed at 20%.

So, if you redeem within 3 years, you pay 20% tax on profits.

This affects small and mid cap gains more because of short-term nature.

That’s another reason to avoid high allocation to small cap now. Keep most of your investments in long-term suitable funds like flexi cap and mid cap.

Emergency Fund Should Be Separate

Don’t mix long-term investment with emergency needs. Keep 6 months of expenses in liquid funds.

This avoids selling equity funds during market falls. It gives you breathing space if needed.

Without this, you may panic and redeem your funds early. That causes loss of returns and peace.

Have You Considered Goal Planning?

You didn’t mention any specific goal. But it helps to define goals clearly.

You can consider:

Retirement planning

Child’s education or marriage

House purchase

Business expansion

Financial freedom

Each goal has a different time horizon. That affects fund selection and asset allocation. A Certified Financial Planner will help match funds to goals.

Why Reviewing Portfolio Annually Is Necessary

Don’t just invest and forget. Your Rs.1.08 crore planned investment (Rs.3 lakhs × 36 months) needs annual check.

Every year:

Review performance of all funds.

Remove consistent underperformers.

Rebalance equity and debt.

Adjust allocation based on market condition.

You may not have time or tools to do this. Hence, a Certified Financial Planner is essential here.

Avoid Over-Diversification

You don’t need 10 funds. Limit to 4 to 5 good ones.

One fund from each category is enough. This avoids overlap and makes tracking easier.

Too many funds:

Create confusion

Repeat same stocks

Don’t improve returns

Make review harder

ULIP, LIC, or Endowment Policies?

If you hold any LIC, ULIP or investment-cum-insurance policies, please check their IRR.

Most give low returns (around 3% to 5%). If you find them underperforming:

Consider surrendering them after lock-in.

Reinvest in mutual funds.

Separate insurance and investment for better results.

Investment Discipline is the Final Secret

Even best funds won’t work if you break your discipline.

Follow these steps:

Stick to monthly SIPs.

Don’t panic in market correction.

Avoid frequent fund switching.

Trust the plan created by a Certified Financial Planner.

Focus on long-term growth, not short-term gain.

Discipline will make your investment journey stress-free and successful.

Finally

You are doing great by committing Rs.3 lakhs monthly.

Your sector selection is fair but needs restructuring.

Limit small cap to 20%. Focus more on flexi and mid cap.

Add debt component to reduce stress.

Avoid direct funds. Go through a Certified Financial Planner.

Stay away from index funds. Use active funds for better performance.

Keep your wife’s investment aligned with yours.

Don’t skip emergency fund.

Review yearly with professional help.

Avoid overlapping funds.

Exit low-return insurance policies if any.

This approach ensures long-term wealth and emotional comfort. You don’t just need growth, you need safe growth.

Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment

...Read more

Ramalingam

Ramalingam Kalirajan  |9470 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 08, 2025

Asked by Anonymous - Jun 25, 2025Hindi
Money
Hi Sir I am 44 year old having EPF 32 lakh FD 34 lakh Mutual fund with SIP 70k amount 17 lakh one 3 bhk flat at Zirakpur(chandigarh) NPS 7 lakh .... Where should I have to invest now
Ans: Your savings journey reflects discipline and consistency. At 44, you are at a crucial phase where wealth protection is as important as wealth creation. Let's assess your current status and guide you toward smart next steps.

Existing Portfolio Assessment
Let us first understand how your portfolio stands:

EPF (Rs 32 lakhs)
This is a solid retirement base. EPF gives safe, tax-free growth. Continue contributing till retirement.

FD (Rs 34 lakhs)
It gives stability but low returns. Interest is taxable. Useful for emergencies or short-term goals, not ideal for long-term growth.

Mutual Fund (SIP Rs 70,000, total value Rs 17 lakhs)
This shows good investment habit. You have strong equity exposure through mutual funds, which helps in beating inflation.

NPS (Rs 7 lakhs)
Good for long-term retirement planning. Tax efficient. Conservative and disciplined by structure.

Flat in Zirakpur
While not treated here as an investment, it adds to your asset base. But no income or liquidity advantage unless rented or sold.

Now let’s move to the core: Where should you invest from now?

Wealth Creation Strategy Ahead
You have a good foundation. Next steps should ensure your money grows efficiently.

1. Reallocate from FD to Better Instruments
FD is earning low post-tax returns.

Move part of it (Rs 15-20 lakhs) to diversified mutual funds.

Choose actively managed funds. Avoid index funds.

SIP mode is best, but for lumpsum, use STP from a liquid fund.

Why not FD?
FD gives fixed returns but taxable. Over time, inflation eats into it.

2. Review Your Mutual Fund Structure
You invest Rs 70,000 per month. That’s powerful. But too many direct mutual funds or schemes can confuse.

Stick to 4-5 actively managed funds across different categories.

If you are investing in direct plans, reconsider.
Direct funds offer no advisory support. If markets fall, you may panic and exit.

Invest through a Mutual Fund Distributor (MFD) who is also a CFP.
You get guidance, goal alignment, and peace of mind.

Why avoid index funds?
Index funds blindly copy the market. They don’t protect during market fall.
Actively managed funds by good fund managers do better in most Indian cycles.

3. NPS – Let it Continue
NPS gives long-term stability.

But don’t overdepend on it.

It forces annuity after 60.
That restricts flexibility in retirement.

Continue your NPS for tax savings and base corpus. But combine with mutual funds for freedom.

4. Build Emergency Fund (If Not Done)
Keep 6 months’ expenses as liquid cash.

Use liquid funds or sweep FDs.

This avoids breaking SIPs during emergencies.

5. Insurance Audit (If Not Already)
Do you have a term insurance?
If not, get Rs 1.5 Cr cover till 60-65 years.

Avoid ULIPs or endowment policies.
If you have any, surrender and reinvest in mutual funds.

Goal Planning – What’s Next?
Now let’s break the upcoming milestones:

A. Retirement – 55 or 60?
You already have:

EPF: Rs 32 lakhs

NPS: Rs 7 lakhs

MF: Rs 17 lakhs (and growing)

FD: Rs 34 lakhs

Continue investing Rs 70,000 monthly in mutual funds. Increase by 5-10% yearly.

With this, and your current savings, you can build Rs 4-5 Cr retirement corpus. That’s enough for a simple and secure life post-retirement.

B. Child’s Education / Marriage
Assuming she is around 10-15 years old now.

You will need Rs 30-50 lakhs in 8-10 years.

Create a separate mutual fund SIP for this goal.

Allocate Rs 20,000 monthly only for this purpose.

This keeps your goals separate and trackable.

C. House Maintenance / Upgrades
Avoid buying another real estate now.

It is illiquid, risky, and difficult to exit.

Focus on financial assets instead.

If you ever want to shift or upgrade, liquid mutual funds will help.

Final Insights
FD and EPF make your portfolio conservative.

Mutual funds bring growth. Continue SIPs and increase slowly.

Avoid direct and index funds. Use an MFD-CFP for guided investments.

Keep goals separate. Track education, retirement, and contingency funds distinctly.

Don't let past good performance make you lazy. Regular reviews are important.

If market falls, don’t stop SIPs. Stick to the plan.

Avoid buying more real estate. Keep liquidity as priority.

You are already ahead of many investors at 44. Keep it disciplined. Keep it simple. Keep it goal-linked.

Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment

...Read more

Ramalingam

Ramalingam Kalirajan  |9470 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jul 08, 2025

Asked by Anonymous - Jun 20, 2025Hindi
Money
Currently, I am investing in MF as below with XIRR 17.58% Mirae Asset Large & Midcap Fund Direct Growth Rs 2000 Mirae Asset ELSS Tax Saver Fund Direct Growth Rs 4000 ICICI Prudential Equity & Debt Fund Direct Growth Rs 4000 Canara Robeco ELSS Tax Saver Direct Growth Rs 4000 Canara Robeco Large Cap Fund Direct Growth Rs 2000 Quant Active Fund Direct Growth Rs 5000 Parag Parikh Flexi Cap Fund Direct Growth Rs 2000 Please suggest if any change is required. I am looking for retirement fund with minimum 4 CR and looking for my child education 2 CR.
Ans: Your Financial Goals

Retirement fund target: Rs 4 Crores

Child’s education fund target: Rs 2 Crores

You have not mentioned the time horizon for both.

For now, we will assume:

Retirement goal – 15 to 20 years away

Education goal – around 10 to 12 years away

These are long-term goals and require consistent and strategic equity exposure.

Current SIP Portfolio Review

Let’s assess your current monthly SIP of Rs 25,000:

Mirae Asset Large & Midcap – Rs 2,000
This category balances stability and growth. Keep allocation minimal.

Mirae Asset ELSS – Rs 4,000
ELSS funds have 3-year lock-in. Useful only if you need tax benefit.
Avoid more than one ELSS fund.

ICICI Equity & Debt Fund – Rs 4,000
Hybrid funds reduce volatility. But not ideal for aggressive long-term growth.

Canara Robeco ELSS – Rs 4,000
You already have one ELSS. Two ELSS schemes dilute focus.

Canara Robeco Large Cap – Rs 2,000
Large caps give stability. Allocation is fine.

Quant Active – Rs 5,000
High-risk, high-return style. Can keep limited exposure.

Parag Parikh Flexi Cap – Rs 2,000
Well-managed diversified fund. Suitable for long-term.

Key Observations and Suggestions

Too Many Funds
Seven funds for Rs 25,000 monthly is excessive.
It spreads your money too thin.
Each fund needs minimum size to show results.

Duplicate Categories
Two ELSS funds. Avoid duplication.
If tax saving is not your aim, ELSS is unnecessary.

Overuse of Direct Funds
Direct funds may look cheaper.
But they offer no human support during market crashes.
Investors make emotional exits at wrong times.
Regular funds via Certified Financial Planner and MFD provide personalised support.
Direct fund route is risky for goal-based investing without expert review.

Avoid Index or ETF Investing
Index funds just copy the index.
They cannot outperform.
During correction phases, they fall more and recover slower.
Active funds are better. Fund managers can protect and grow your money.
ETFs are just index funds traded like shares.
They offer no advisory support and involve price volatility.

Recommended Portfolio Restructure

Here is a simplified suggestion:

One Flexicap Fund (for core long-term growth)

One Midcap Fund (for long-term wealth creation)

One Hybrid Aggressive Fund (to reduce volatility in short-term)

Optional: One ELSS Fund (only if you need Sec 80C deduction)

This way, you manage risk and get better returns with less complexity.

How to Allocate Your SIPs Wisely

Flexicap Fund – Rs 10,000

Midcap Fund – Rs 7,000

Hybrid Aggressive Fund – Rs 5,000

ELSS Fund – Rs 3,000 (only if required for tax)

This structure gives direction, clarity and growth focus.

Review Your Fund Performance Periodically

Don’t judge a fund by 1-year returns

See rolling performance across 3, 5 and 7 years

Check fund house stability, manager consistency

Avoid switching funds too frequently

Are Your SIPs Enough for Your Goals?

For Rs 2 Cr education fund in 12 years, you need focused allocation

For Rs 4 Cr retirement in 20 years, SIPs need to grow gradually

Current SIP of Rs 25,000/month may not be enough for both

You may need to increase it by 10% every year

As income grows, increase SIPs. Also do lumpsum whenever possible.
Track the gap between required and actual corpus annually.

Secure Your Child’s Future Better

You already have SIPs and term insurance.

Add a dedicated child fund (not child ULIP or plan from insurer)

Choose pure mutual funds.

Invest regularly. Track goals yearly.

Avoid gold ETF for child’s future. It doesn’t match education cost inflation.

About Your Term Insurance

You didn’t mention coverage amount

For Rs 6 Cr of goals, ideal cover is 12 to 15 times your income

Keep your term cover separate from investment

Review the policy every 3 to 5 years

Final Insights

Restructure funds. Avoid duplication and unnecessary direct funds

Use actively managed regular funds via CFP and MFD

Build child’s education corpus with discipline

Retirement corpus target is realistic. Increase SIPs gradually

Track fund performance every 6 months.

Do not mix insurance with investment.

Avoid ETF and Index Funds for wealth building

Maintain asset allocation. Review annually

Keep emergency fund in liquid fund or short-term plan

What You Can Do Next

Consolidate your funds

Consult a Certified Financial Planner to create a personalised goal tracker

Shift to a guided MFD platform that gives you regular review

Reinvest ELSS redemption amount after 3 years in the new structure

Ensure you have health insurance too – not mentioned above

Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in
https://www.youtube.com/@HolisticInvestment

...Read more

DISCLAIMER: The content of this post by the expert is the personal view of the rediffGURU. Investment in securities market are subject to market risks. Read all the related document carefully before investing. The securities quoted are for illustration only and are not recommendatory. Users are advised to pursue the information provided by the rediffGURU only as a source of information and as a point of reference and to rely on their own judgement when making a decision. RediffGURUS is an intermediary as per India's Information Technology Act.

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