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Ramalingam

Ramalingam Kalirajan  |8322 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 27, 2024

Ramalingam Kalirajan has over 23 years of experience in mutual funds and financial planning.
He has an MBA in finance from the University of Madras and is a certified financial planner.
He is the director and chief financial planner at Holistic Investment, a Chennai-based firm that offers financial planning and wealth management advice.... more
Rohith Question by Rohith on Apr 04, 2024Hindi
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Namaste Kirtan Sir, I have Started SIP 2014 with one fund, but started really focusing on from last 2 years with multiple fund and also increased the top-up on few fund. New SIP Fund Details 1. Aditya Birla Sun Life Gold Fund - Gr : 2500 from Jan-2024 2. Kotak Business Cycle Fund - Gr : 2000 from Oct-2022 3. NJ ELSS Tax Saver Scheme - Gr : 3000 from Aug-2023 4. SBI Blue Chip Fund - Gr : 2500 from Jan-2024 Existing SIP Fund & TOP up 5. Baroda BNP Paribas India Consumption Fund - Gr : 1500 from Sept-2022 & Top Up from Jan-2024 6. Nippon India Flexi Cap Fund - Gr : 1500 Started from Sept-2022 & Top Up from Jan-2024 7. Tata Equity P/E Fund Gr : 2000 from July-2014 & Top Up from Jan-2024 Total of 20k SIP Can you just review my portfolio and guide us wither investment is on right fund. Thank you in advance Rohith Adiga

Ans: Rohith,

It's commendable to see your dedication towards building a diversified investment portfolio through SIPs. Reviewing your portfolio is crucial to ensure it remains aligned with your financial goals and risk tolerance.

Firstly, let me appreciate your proactive approach in diversifying your investments across multiple funds. This spreads risk and enhances potential returns. However, it's essential to periodically evaluate the performance of each fund and make adjustments as necessary.

Consider factors like fund performance, consistency, fund manager's track record, and investment objectives. Additionally, assess whether your portfolio reflects your risk appetite and investment horizon.

Remember, investing is a journey, not a destination. Stay informed, stay patient, and stay committed to your financial goals. Regularly review and rebalance your portfolio to adapt to changing market conditions and personal circumstances.

As a Certified Financial Planner, my role is to guide you on this journey, providing insights and recommendations tailored to your unique situation. Feel free to reach out for further assistance or clarification.

Wishing you success in your investment journey!
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

Ramalingam Kalirajan  |8322 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Apr 04, 2024

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Namaste Ramalingam Sir, I have Started SIP 2014 with one fund, but started really focusing on from last 2 years with multiple fund and also increased the top-up on few fund. New SIP Fund Details 1. Aditya Birla Sun Life Gold Fund - Gr : 2500 from Jan-2024 2. Kotak Business Cycle Fund - Gr : 2000 from Oct-2022 3. NJ ELSS Tax Saver Scheme - Gr : 3000 from Aug-2023 4. SBI Blue Chip Fund - Gr : 2500 from Jan-2024 Existing SIP Fund & TOP up 5. Baroda BNP Paribas India Consumption Fund - Gr : 1500 from Sept-2022 & Top Up from Jan-2024 6. Nippon India Flexi Cap Fund - Gr : 1500 Started from Sept-2022 & Top Up from Jan-2024 7. Tata Equity P/E Fund Gr : 2000 from July-2014 & Top Up from Jan-2024 Total of 20k SIP Can you just review my portfolio and guide us wither investment is on right fund. Thank you in advance Rohith Adiga
Ans: Your portfolio seems well-diversified across various fund categories, which is a positive approach. It's essential to regularly review your investments to ensure they align with your financial goals and risk tolerance. Consider the purpose of each fund in your portfolio and whether it complements your overall investment strategy. If any fund consistently underperforms or no longer fits your investment objectives, you may consider reallocating or replacing it. Additionally, monitoring market trends and staying updated on economic developments can help you make informed investment decisions. If you're unsure about any aspect of your portfolio, consulting a financial advisor can provide valuable insights tailored to your individual circumstances.

..Read more

Ramalingam

Ramalingam Kalirajan  |8322 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 18, 2024

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Sir my age is 32 years, I have started Sip since July 2023 my investment details are below Nippon small cap 2k Quant small cap 1k Tata small cap 1k Sbi small cap 2k ICICI prudential value 2k Quant mid cap 3k Sbi magnam mid cap 2k Sbi contra fund 3k Parag Parikh flexi cap 2k 25 years sip plan with step up, please review my portfolio,
Ans: Your proactive approach to investing in SIPs at a young age is commendable. This sets a strong foundation for long-term wealth creation. Your diversified portfolio reflects a good understanding of market opportunities and risks.

Evaluating Your Current Portfolio
Current Investments:

Your SIPs are spread across small cap, mid cap, and contra funds, with a flexi cap for additional diversification.
Each category serves a distinct purpose in your investment strategy.
Portfolio Composition Analysis
Small Cap Funds:

Growth Potential: Small cap funds offer high growth potential but come with higher risk.
Current Allocation: You have ?6,000 in small cap funds, which is quite aggressive.
Assessment: High risk, high return. Ensure you are comfortable with the volatility.
Mid Cap Funds:

Balanced Growth: Mid cap funds provide a balance between growth and stability.
Current Allocation: ?5,000 in mid cap funds. This is a good strategy to capture growth while managing risk.
Assessment: Moderately risky, suitable for long-term goals.
Value and Contra Funds:

Defensive Strategy: These funds invest in undervalued stocks, aiming for long-term growth.
Current Allocation: ?5,000 combined in value and contra funds.
Assessment: Less risky, suitable for market downturns.
Flexi Cap Funds:

Diversification: Flexi cap funds invest across market capitalizations, providing diversification.
Current Allocation: ?2,000 in flexi cap.
Assessment: Provides a safety net by diversifying across various market segments.
Recommendations for Optimization
Balancing Risk and Growth:

Reallocation Suggestion: Consider reallocating some funds from small cap to more stable options like large cap or balanced funds.
Reason: Reduces overall portfolio risk while still aiming for growth.
Introduction of Large Cap Funds:

Suggestion: Add a large cap fund to your portfolio.
Reason: Large cap funds provide stability and steady returns, balancing the high-risk small and mid cap funds.
Balanced Funds:

Suggestion: Include a balanced or hybrid fund.
Reason: These funds invest in both equity and debt, offering a balanced risk-reward profile.
Portfolio Step-Up Strategy
Regular Increases:

Implementation: Increase your SIP contributions annually as planned.
Reason: Step-up SIPs help in compounding your investments more effectively.
Importance of Professional Guidance
Engage a Certified Financial Planner (CFP):

Benefits: Personalized advice tailored to your financial goals and risk tolerance.
Reason: A CFP can help optimize your portfolio and ensure it aligns with your long-term goals.
Regular Monitoring and Review
Periodic Portfolio Review:

Frequency: Review your investment portfolio at least annually.
Reason: Ensures your investments stay aligned with your goals and market conditions.
Rebalancing:

Action: Rebalance your portfolio if any fund significantly outperforms or underperforms.
Reason: Maintains desired asset allocation and risk level.
Final Thoughts
Your disciplined investment in SIPs across diverse funds is a strong start. For optimal growth and risk management, consider introducing large cap and balanced funds into your portfolio. Regular reviews and professional guidance will keep your investments on track. Your commitment to a 25-year plan with step-ups shows foresight and determination, paving the way for substantial wealth creation.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |8322 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 28, 2024

Asked by Anonymous - May 27, 2024Hindi
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Please review my SIP portfolio - HDFC Retirement fund 10K pm ICICI Retirement fund 10K pm UTI Mutual Fund UTI Mid Cap Fund - Regular Plan 5k pm SUNDARAM LARGE AND MID CAP FUND - REGULAR GROWTH 5k pm Union Children's fund 10k pm Aditya Birla Sun Life Multi-Cap Fund Regular Growth 10k pm Samco Flexi Cap Fund - 10k pm Union Innovation and Opportunities Fund - Regular Growth - 10k pm Parag Parikh Flexicap 2k pm Parag Parikh Dynamic asset allocation fund 5k pm Bank of India Manufacturing and Infrastructure fund 10k pm ULIP Plan (midcap momentum fund) - 5k pm HDFC Large cap and mid cap - IDCW - 500 rs pm Intention is to invest and hold for 15 more years. What changes do I bring in?
Ans: Understanding Your Investment Goals
You have a well-structured SIP portfolio with a diverse range of mutual funds and plans. Your goal is to invest and hold for 15 more years, which is a commendable strategy for long-term wealth creation. The mix of funds you've chosen indicates a balanced approach towards growth and security.

Assessment of Current Portfolio
Your portfolio consists of various mutual funds, including retirement funds, mid-cap, large-cap, multi-cap, and sector-specific funds. This diversity helps in spreading risk across different sectors and market capitalizations. Investing Rs. 10,000 per month in each of the retirement funds is a sound decision, as these funds are designed to provide stability and growth over the long term.

Evaluating Fund Types
You have included mid-cap and large-cap funds, which offer growth potential and relative stability. Mid-cap funds are known for their high growth potential but come with higher volatility. Large-cap funds provide stability and consistent returns over time. Your investment in multi-cap and flexi-cap funds ensures flexibility in adjusting the portfolio according to market conditions.

Regular vs. Direct Funds
You have opted for regular plans instead of direct funds, which is beneficial. Regular funds come with the advantage of professional advice and management. A Certified Financial Planner (CFP) can help you make informed decisions and provide insights that are not easily accessible through direct funds.

Sector-Specific Investments
Your portfolio includes sector-specific funds like the manufacturing and infrastructure fund. These funds can provide high returns when their respective sectors perform well. However, they also come with higher risk if the sector faces downturns. Balancing these with more stable funds is a good strategy.

Child-Specific Investments
Investing in a children's fund is a thoughtful decision. These funds are designed to provide long-term growth and cater to future educational and other needs of your children. Ensuring a regular investment in these funds will secure your child's future financial needs.

ULIP and Retirement Funds
Your inclusion of a ULIP plan with a mid-cap momentum fund and various retirement funds shows a balanced approach. ULIPs combine insurance with investment, providing dual benefits. However, they often come with higher charges. Evaluating the performance and costs associated with ULIPs regularly is essential.

Reviewing Fund Performance
Regularly review the performance of your funds. Compare their returns with benchmark indices and peer funds. This helps in identifying underperforming funds and making necessary adjustments.

Risk Management
Your portfolio shows a balanced approach to risk with investments in large-cap, mid-cap, and multi-cap funds. Adding dynamic asset allocation funds helps in adjusting the portfolio according to market conditions, further managing risk effectively.

Recommendations for Portfolio Enhancement
Maintain Portfolio Balance: Ensure a mix of equity and debt funds to balance risk and return. Consider including more dynamic asset allocation funds if market volatility increases.

Monitor Sector Exposure: Regularly review sector-specific funds to avoid overexposure to any single sector. Diversify further if necessary.

Evaluate ULIP Performance: Regularly assess the performance and charges associated with ULIPs. Ensure they align with your financial goals.

Stay Informed: Keep yourself updated with market trends and seek professional advice from a Certified Financial Planner to make informed decisions.

Flexibility in Investments: Be open to adjusting your portfolio based on market conditions and life changes. Regularly rebalance your portfolio to maintain the desired asset allocation.

Appreciating Your Strategy
Your approach to long-term investment through SIPs is commendable. Regular investments and a diversified portfolio are key to achieving financial stability and growth. Your thoughtful inclusion of children's funds and retirement plans shows a strong commitment to securing your family's future.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Ramalingam

Ramalingam Kalirajan  |8322 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on Jun 16, 2024

Asked by Anonymous - Jun 16, 2024Hindi
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Hi sir. I am 38 years old have started SIP from 2024 jan. Following are the fund i am doing SIP. 1. Kotak ELSS 2. Quant ELSS 3.parag parikh flexi cap- regular 4.Nippon infrastructure growth-regular 5. SBI contra- regular 6.franklin india focussed equity fund-regular 7.Bajaj finserv multiasset alocation-regular 8.ICICI prudential silver ETF fund 9.ICICI prudential bharat 22 fof 10. HDFC small cap fund- regular My total monthly SIP amount 23000 INR. Kindy let me know if i have good portfolio diversification. Do i need to stop SIP in any kf above fund and start some other good fund. My motto is to get maximum return for next 10-15 years.
Ans: Assessing Your Investment Portfolio
Your investment portfolio is diversified, and that is commendable. However, let’s delve into the specifics of your funds to see if there’s room for optimization. Portfolio diversification is essential, but too many funds can lead to over-diversification, which might dilute returns.

Equity Linked Savings Schemes (ELSS)
You have two ELSS funds. ELSS is excellent for tax-saving under Section 80C. They also offer the potential for high returns due to their equity exposure. However, investing in multiple ELSS funds can be redundant. Consider consolidating your ELSS investments into one well-performing fund to streamline your portfolio.

Flexi Cap Funds
Flexi cap funds are versatile as they invest across market capitalizations based on the fund manager's outlook. Your flexi cap fund choice is prudent as it offers flexibility and diversification within itself. This type of fund can balance risk and reward effectively, adapting to market conditions.

Sectoral and Thematic Funds
You are investing in an infrastructure growth fund. Sectoral funds can provide high returns but come with higher risk due to their concentrated exposure. Infrastructure is a promising sector but is also susceptible to economic cycles and regulatory changes. It’s wise to limit exposure to such sector-specific funds to avoid significant volatility in your portfolio.

Contra Funds
Contra funds invest in undervalued stocks and follow a contrarian approach. These funds can provide significant returns during market corrections when undervalued stocks rebound. However, they require patience and a long-term horizon, which aligns well with your 10-15 year investment goal.

Focused Equity Funds
Focused equity funds concentrate on a limited number of stocks. This strategy can yield higher returns if the selected stocks perform well but also increases risk due to lower diversification. Ensure that the focused equity fund aligns with your risk tolerance and long-term goals.

Multi-Asset Allocation Funds
Multi-asset allocation funds invest across asset classes like equity, debt, and gold, providing diversification and risk management. This fund type is suitable for balanced growth and risk mitigation. Including such a fund in your portfolio adds stability and reduces dependency on market performance.

Precious Metals Fund
Your investment in a silver ETF fund adds an element of commodity diversification. Precious metals like silver can hedge against inflation and currency fluctuations. However, precious metal funds can be volatile and might not perform consistently over time. Limit exposure to such funds to avoid excessive risk.

Fund of Funds (FoF)
The Bharat 22 FoF invests in a basket of stocks from the Bharat 22 index, providing diversification within a single fund. FoFs can offer easy access to diversified portfolios but come with higher expense ratios due to the layered fee structure. Ensure the FoF aligns with your overall investment strategy and cost considerations.

Small Cap Funds
Small cap funds invest in smaller companies with high growth potential. These funds can offer substantial returns but also come with higher risk due to market volatility. Given your long-term horizon, small cap funds can be a valuable addition for capital growth, but monitor their performance and risk exposure closely.

Regular vs. Direct Funds
You have chosen regular plans through a mutual fund distributor (MFD) with a Certified Financial Planner (CFP) credential. Regular funds have slightly higher expense ratios due to distributor commissions. However, the guidance and advice from a certified professional can be invaluable in navigating market complexities and making informed decisions. Direct funds, while cheaper, require a deep understanding of market dynamics and continuous monitoring, which might not be feasible for all investors.

Disadvantages of Index Funds
Index funds, which you haven't opted for, have the disadvantage of passively following a market index. They cannot outperform the market as they merely replicate index performance. In contrast, actively managed funds, like the ones in your portfolio, have the potential to outperform through strategic stock selection and market timing by experienced fund managers. Active management can add significant value, especially in volatile or bearish markets.

Portfolio Optimization Suggestions
Consolidate ELSS Investments: Streamline your ELSS investments into one well-performing fund to avoid redundancy and simplify tracking.

Review Sectoral Fund Exposure: Limit exposure to sectoral funds like the infrastructure growth fund to manage risk better. Sectoral funds should not form a large portion of your portfolio.

Focus on Core Holdings: Maintain a balanced mix of flexi cap, contra, and focused equity funds as core holdings for stable and diversified growth.

Limit Precious Metals and Sectoral Exposure: Keep your investments in precious metals and sectoral funds minimal to avoid excessive risk from market volatility.

Evaluate Expense Ratios: Regularly review the expense ratios of your funds, especially the FoFs, to ensure they are cost-effective relative to their performance.

Understanding Market Cycles and Patience
Investing for 10-15 years requires understanding market cycles and having patience. Markets will have ups and downs, and staying invested during downturns is crucial for long-term growth. Avoid the temptation to make frequent changes based on short-term market movements. Instead, focus on your long-term goals and stay committed to your investment strategy.

Regular Review and Rebalancing
Regularly reviewing your portfolio and rebalancing it as needed is vital. As market conditions change, the allocation of your investments may drift from your original plan. Rebalancing ensures that your portfolio remains aligned with your risk tolerance and investment objectives. It also helps lock in gains and manage risks effectively.

Importance of Diversification
Diversification reduces risk by spreading investments across various asset classes and sectors. While you have diversified your investments, ensure that no single fund or sector dominates your portfolio. Proper diversification can enhance returns while mitigating risks, helping you achieve a balanced and resilient portfolio.

Role of a Certified Financial Planner
Working with a Certified Financial Planner (CFP) provides access to professional advice tailored to your financial goals. A CFP can help you make informed decisions, optimize your portfolio, and navigate complex market conditions. Their expertise ensures that your investments are aligned with your risk tolerance and long-term objectives.

Final Insights
Your current portfolio demonstrates a commendable approach towards diversification and long-term growth. However, streamlining your investments and focusing on core holdings can enhance returns and manage risks more effectively. Regular reviews and rebalancing, along with professional guidance from a Certified Financial Planner, will ensure that your investment journey remains on track towards achieving your financial goals.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in

..Read more

Latest Questions
Ramalingam

Ramalingam Kalirajan  |8322 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 07, 2025

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I am 50 + yr Engg Graduate and working in Pvt sector in NCR and having approx 10 yrs to retirement. # The Combined Family income (Including Dividend & Interest) : Rs. 22 Lac / Annum. # Yearly Expenditure : Rs.13.1 Lac / Annum (Includes Insurance Premium , fee , Rent etc); # I am Staying in Rent ; I am Have a old parental Flat at Lucknow (Vacant) which will be sold off inleu of a new Flat in next 4-5 years time (Present Value of Flat is approx Rs. 75 Lac ; ) # Term Insurance till age 62 yrs: Sum Insured : Rs. 1.70 Cr ; # Health Insurance Floater : Covered till Rs. 50 Lacs. Portfolio : * MF-SIP : 1.80 Cr.; Monthly investment in SIP: ~ 65000/-. [MF SIP Selection is self] * Combined PPF : Rs.40 Lac * Sukanya Samriddhi Yojana : Rs. 6.0 Lac * Share Value: Rs.50 Lacs * FD with Pvt Financial institutions : Rs. 43 Lac. * Cash in Hand : Rs. 4-5 Lacs Major Expenditure to be done: (a) Higher Studies of Daughter: Going for PG - 1st yr & maybe later Phd. (b) Marriage of Daughter. (c) Higher Studies of Son : Presently in Class IX. (d) Marriage of Son . (e) Buying a new House. Pls advise : 1. How much Corpus will I have in next 10 yrs.? 2. How much should be the minimum corpus I should have at the time of my retirement so that it can last maybe for 25 + years post retirement? 3. Will I be able to achieve the reqd corpus? 4. What is the Likely monthly expenditure post my retirement ? 5. Can I share my List of SIP Portfolio with you so that same can be restructured by you ? 6. Should I go for a Professional Financial Planner ? regards
Ans: You have already done a lot of planning. Your awareness and discipline are strong. This gives you a great advantage for your retirement and children’s future.

Understanding Your Present Financial Snapshot
 

You are above 50 years of age and have around 10 years to retire.

 

Your yearly family income is Rs.22 lakh. Expenses are around Rs.13.1 lakh.

 

That means you are saving close to Rs.8.9 lakh yearly. That’s a strong surplus.

 

Monthly SIP is Rs.65,000. You have a solid SIP discipline in place.

 

Current MF SIP corpus is Rs.1.8 crore. That’s a significant base.

 

PPF corpus is Rs.40 lakh. That’s a good stable portion of your savings.

 

Shares are worth Rs.50 lakh. FD value is Rs.43 lakh.

 

You have Rs.4–5 lakh in liquid cash. Sukanya balance is Rs.6 lakh.

 

You are staying on rent. You have an old flat in Lucknow worth Rs.75 lakh.

 

You want to sell the flat in 4–5 years. Use funds for buying a new flat.

 

Health insurance floater of Rs.50 lakh is excellent.

 

Term insurance of Rs.1.7 crore till age 62 is also strong.

 

Likely Corpus in Next 10 Years
 

Your existing investments are already close to Rs.3.7 crore.

 

With SIPs and expected growth, this corpus will rise steadily.

 

Assuming consistent investment, the corpus could cross Rs.6 crore in 10 years.

 

This figure depends on SIP continuation, market returns, and investment review.

 

If you sell the flat in 5 years, you may get Rs.80–85 lakh or more.

 

That can also be redirected to another house purchase.

 

But remember, house is not an investment. It’s a utility asset.

 

It will not support retirement income unless sold or rented.

 

How Much Corpus Is Needed at Retirement?
 

Your current annual spending is Rs.13.1 lakh.

 

Post-retirement, this may reduce slightly. But not by much.

 

Assume 80% of current expenses will continue. That’s around Rs.10.5 lakh yearly.

 

Over 25+ years, this amount will rise due to inflation.

 

A safe minimum retirement corpus can be around Rs.5.5–6 crore.

 

This should cover lifestyle, healthcare, and emergency spending.

 

It also assumes a balanced investment portfolio post-retirement.

 

PPF, FDs, and some debt funds can give regular income.

 

Equity mutual funds should be continued partially for growth.

 

Can You Achieve the Required Corpus?
 

Yes, based on your present investments and habits, you are on track.

 

You must keep SIPs running without breaks for the next 10 years.

 

Increase your SIPs by 8–10% every year.

 

This single habit increases your total retirement corpus sharply.

 

Don’t withdraw from MF portfolio for house or other large expenses.

 

Use surplus from share sale or FD maturity for daughter’s or son’s needs.

 

Maintain separate goals. Don’t mix retirement and child-related funds.

 

Likely Monthly Expenses After Retirement
 

Your monthly spending may reduce, but not disappear.

 

House rent may go if you buy a flat. But other costs may rise.

 

Healthcare costs will rise as you age. So will travel and daily needs.

 

Monthly spending may be around Rs.80,000 to Rs.90,000 after retirement.

 

This will keep increasing due to inflation.

 

Plan for this by keeping a rising income source post-retirement.

 

Part of your MF portfolio must remain in equity to beat inflation.

 

Should You Restructure Your SIP Portfolio?
 

Yes. You can share your SIP portfolio. It should be reviewed in detail.

 

Fund selection must suit your goals, risk, and retirement timeline.

 

If SIPs are selected by self, mistakes may remain unnoticed.

 

Self-managed portfolios often carry duplication and poor diversification.

 

Review will ensure you hold right funds in correct proportion.

 

Regular rebalancing and fund replacement are also needed.

 

Avoid index funds. They copy the index. No expert decision-making involved.

 

Actively managed funds give better chances of outperformance.

 

A fund manager takes timely calls based on market data.

 

Direct Plans vs Regular Plans
 

Many people choose direct funds thinking returns will be more.

 

But direct plans give no advice, no monitoring, no fund review.

 

Wrong choices can erode gains, which you may not notice.

 

Investing through MFD with CFP support gives many advantages.

 

You get continuous guidance, strategy correction, and emotional discipline.

 

A small extra cost is worth it for safer long-term performance.

 

Use regular plans under a Certified Financial Planner to avoid mistakes.

 

Should You Hire a Certified Financial Planner?
 

Yes, it is the right time to do so.

 

You are close to retirement. No room for errors now.

 

One bad year or wrong withdrawal can hurt long-term stability.

 

A planner prepares a full retirement roadmap. Step-by-step.

 

Helps manage retirement income, investment allocation, and cashflow.

 

Plans for children’s education, marriage, and tax-saving.

 

Also prepares a Will, estate plan, and contingency system.

 

You have built wealth. A planner helps protect and grow it safely.

 

Other Action Points You Must Consider
 

Keep 6 months’ expenses in liquid mutual funds. That’s your emergency fund.

 

Keep track of new MF capital gains tax rules.

 

If equity MF gains exceed Rs.1.25 lakh in a year, excess is taxed at 12.5%.

 

If sold within one year, tax is 20% on profits.

 

For debt funds, all gains are taxed as per your income slab.

 

File taxes properly. Use Form 26AS and AIS to avoid mismatch.

 

Make a written Will. Register it if possible.

 

Update nominations in all mutual funds, FDs, and insurance.

 

Involve your spouse in all investment decisions. Keep them informed.

 

Retirement Income Management Strategy
 

Break your retirement portfolio into three buckets.

 

First: Emergency and liquidity. Use FDs and liquid funds here.

 

Second: Stable monthly income. Use PPF, debt mutual funds, and bonds.

 

Third: Long-term growth. Keep some mutual funds in equity.

 

Withdraw only what is needed. Keep rest invested.

 

Review once a year with your planner.

 

Children’s Education and Marriage Planning
 

PG for daughter is immediate. Use FD interest or surplus cash.

 

Don’t disturb mutual funds meant for retirement.

 

PhD is long-term. Plan SIPs separately for that.

 

Son’s education is 4–5 years away. Start new SIPs today.

 

Marriage cost is hard to predict. But start a separate investment for that now.

 

Keep gifts, bonuses, or land sale proceeds for such events.

 

Don’t allow such costs to delay or reduce your retirement corpus.

 

Final Insights
 

You are in a strong financial position. That itself is an advantage.

 

But with multiple goals ahead, clear planning becomes important.

 

Don’t self-manage complex portfolios at this stage.

 

Avoid real estate dependence. Use it only for living, not investing.

 

Stay away from index and direct funds. They don’t give personal strategy.

 

Increase SIPs each year. Tag each goal separately.

 

Use a Certified Financial Planner to guide your retirement strategy.

 

Update nominations, Will, and insurance coverage.

 

Monitor your retirement portfolio closely, but don’t panic with market ups and downs.

 

Stay invested. Think long-term. Follow a guided, reviewed plan.

 

You can retire comfortably and fulfil all family goals with peace of mind.

 

Best Regards,
 

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

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Ramalingam

Ramalingam Kalirajan  |8322 Answers  |Ask -

Mutual Funds, Financial Planning Expert - Answered on May 07, 2025

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Dear sir, I am 46 yrs old investing in SIP of 25000 monthly last 4.5 Yrs in different companies mutual fund. I wants retire after 10 yrs and need a corpus of 5 crore. I have 2 children studying @ 6&8 grade. Invested in money back policy of 5-8 Lakh. 1C land purchased 2 yrs back. Comprehensive Health insurance is available for 5L yearly and Term insurance of 60L is available. Kindly let me know what sort of planning required.
Ans: It shows you are thinking ahead for your family and future. That itself is a great start.

Let’s break this down step by step.

 

Retirement Planning – 10 Years Away
 

You want Rs.5 crore in 10 years.

 

You are already investing Rs.25,000 monthly through SIPs. This is a good habit.

 

But just investing isn’t enough. The amount, fund selection, and review also matter.

 

Rs.5 crore is a big target. It needs a solid, focused investment plan.

 

You need to check whether Rs.25,000 per month is enough for this goal.

 

Based on typical growth rates, it may fall short. We need to increase SIPs gradually.

 

A Certified Financial Planner can help assess the exact shortfall. Then a step-wise plan can be made.

 

Your retirement plan should not depend on land. Land is not liquid. Selling it can take time.

 

Continue SIPs and increase it by 10% every year. That helps stay ahead of inflation.

 

Actively managed mutual funds should be selected. They give a better edge with expert fund manager decisions.

 

Index funds lack flexibility. They copy the index. No chance to beat the market.

 

With actively managed funds, the fund manager reacts fast to changes. That is an advantage.

 

Asset allocation should be reviewed every year. Rebalancing keeps the risk in control.

 

Keep a separate portfolio for retirement. Do not mix children’s education goal with this.

 

Children’s Education Planning
 

Your children are now in 6th and 8th grades.

 

In 6–8 years, you’ll need funds for their higher education.

 

Education costs are rising sharply. This cannot be ignored.

 

Start separate SIPs for their education goal now.

 

Do not depend on money-back policies for education.

 

These give low returns. Hardly beat inflation. Not suitable for education needs.

 

Surrender these policies. Reinvest the proceeds into mutual funds.

 

A Certified Financial Planner can guide on which policies to surrender and how.

 

Use mutual funds for better returns and flexibility.

 

Choose a mix of equity and balanced funds. This gives better growth with some safety.

 

Review this portfolio every year. Make changes if fund performance drops.

 

Never use retirement funds for education or other goals.

 

Keep clear boundaries between each financial goal.

 

Insurance Assessment – Life and Health
 

You have Rs.60 lakh term insurance. It is a good starting point.

 

But is it enough? Likely not.

 

A person at age 46 with children and a Rs.5 crore retirement goal needs more cover.

 

Term cover must be at least 12–15 times your annual income.

 

It should also cover children’s education and liabilities.

 

Top up your term insurance with an additional Rs.40–50 lakh at least.

 

Premiums are still manageable at your age.

 

Avoid ULIPs or money-back plans for life cover. They mix insurance and investment.

 

You have Rs.5 lakh health insurance. That is a positive step.

 

However, with rising medical costs, it is not enough.

 

Add a super top-up policy of Rs.10–15 lakh. It is cost-effective and gives added protection.

 

Ensure the entire family is covered under the policy.

 

Also keep some emergency fund in liquid funds for minor health expenses.

 

Emergency Fund and Contingency Planning
 

An emergency fund gives peace of mind.

 

It should cover at least 6 months of expenses.

 

Keep this in a liquid mutual fund or savings account.

 

Never invest emergency funds in equity or land.

 

Refill the fund if you use it anytime.

 

Existing Land Investment
 

You mentioned buying land two years ago.

 

It can be a personal asset. But not an investment.

 

Land does not generate regular income.

 

Selling land can take time. Liquidity is low.

 

Do not depend on land for your retirement or education goals.

 

Do not count land value in your net worth for investment planning.

 

Keep it as a reserve or personal utility asset only.

 

Money-Back Policies – Action Plan
 

You have Rs.5–8 lakh in money-back policies.

 

These offer low returns. Do not help in long-term wealth creation.

 

It is best to surrender these now. Don’t wait.

 

Reinvest that money into mutual funds through a Certified Financial Planner.

 

Use regular plans through MFDs. They offer continuous support and monitoring.

 

Direct mutual funds offer no guidance. That leads to mistakes and poor returns.

 

Regular funds give access to a CFP’s review and hand-holding.

 

Small cost difference, but better long-term results.

 

SIP Management – Next Steps
 

You are already investing Rs.25,000 monthly. That is commendable.

 

Increase it every year. This is called SIP step-up.

 

If your income rises, increase SIPs by 10–15% yearly.

 

This one habit helps you reach goals faster.

 

Choose 4–5 diversified equity funds. Review them every 6 months.

 

Use funds with consistent track records and experienced managers.

 

Avoid index funds. They are passive. No fund manager input.

 

Actively managed funds offer better opportunities.

 

Tax Planning – For Today and Tomorrow
 

Make use of Section 80C for tax savings. SIP in ELSS can help here.

 

Avoid locking too much in PPF or NSC. They are not flexible.

 

For capital gains tax, keep new rules in mind.

 

If you sell equity funds, gains above Rs.1.25 lakh are taxed at 12.5%.

 

If sold before 1 year, gains are taxed at 20%.

 

For debt funds, all gains are taxed as per your income slab.

 

Always check tax implication before switching or redeeming funds.

 

Goal-Based Investment Planning
 

Link each SIP to a specific goal.

 

One SIP for retirement.

 

One SIP for child 1 education.

 

Another SIP for child 2 education.

 

Do not combine goals. That leads to confusion later.

 

Clear goal tagging helps track progress.

 

A Certified Financial Planner can prepare this map for you.

 

Use colour-coded tracking for each goal.

 

Will, Nomination, and Estate Planning
 

Make a basic Will. Even if your assets are small today.

 

Nominate properly in every investment and insurance.

 

Review nominations every 2 years.

 

Teach your spouse the basics of your financial plan.

 

Keep one folder with all details – policies, accounts, mutual funds.

 

Inform your family where the file is kept.

 

Three Yearly Review System
 

Review your financial plan every year.

 

Do it with the help of a Certified Financial Planner.

 

Track SIP growth. Are goals on track?

 

Rebalance asset allocation if equity grows too much.

 

Check insurance covers every 2 years.

 

Update Will, nominations, and goals if needed.

 

Final Insights
 

You have taken important first steps. That shows awareness.

 

But awareness needs a plan to be successful.

 

Surrender low-yielding policies. Reinvest wisely.

 

Keep land aside. Do not count on it for goals.

 

Increase SIPs steadily. Choose only actively managed funds.

 

Use regular mutual funds through a Certified Financial Planner.

 

Protect family with higher life and health insurance.

 

Separate SIPs for each goal. Link every investment to a purpose.

 

Review your plan once every year. Adjust when needed.

 

Your dream of Rs.5 crore and children’s education is possible.

 

But you need focused, guided steps to reach there.

 

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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