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Ramalingam Kalirajan |11135 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on Mar 17, 2026

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

Asked by Anonymous - Feb 18, 2026Hindi

Dear Sir, I am regular reader of your analysis. My question is that how we can beat inflation on our investment now a days. Neither share market. MF, or any asset class giving 12% constant return. Suppose, if I have 50000 surplus fund every month from feb 26 onwards then where we divide 50k fund to invest in various place to get at least 10 percent return on an average for next 5 years, thanks for your support as always to your readers

Ans: You are thinking in the right direction. Accepting that “12% constant return is not practical” itself is a very mature step. The goal now is not to chase return, but to design a system which can deliver around 9–10% on average with controlled risk.

Let me guide you clearly.

» Reality Check on Returns

– No asset class gives fixed 10–12% every year
– Equity gives good returns, but in cycles
– Debt gives stability, but lower returns
– Gold protects in uncertainty

So:
– Combination of assets is the only way to beat inflation

» Your Monthly Surplus Strategy (Rs 50,000)

You should not put full Rs 50,000 in one place. Divide it smartly.

Suggested structure:

– Rs 25,000 → Equity Mutual Funds (core growth)
– Rs 10,000 → Hybrid / Multi-asset funds (balance + stability)
– Rs 10,000 → Short-term debt / dynamic debt (stability + liquidity)
– Rs 5,000 → Gold (hedge + diversification)

This gives you:
– Growth + safety + balance

» Why This Allocation Works

– Equity portion (50%) drives returns
– Hybrid reduces volatility
– Debt gives stability and rebalancing power
– Gold protects in uncertain markets

Together:
– You can aim for 9–10% average over 5 years, not every year

» Important Behaviour Rule

– Do SIP every month without fail
– Do not stop when market falls
– In fact, increase SIP during corrections if possible

This is where most investors fail.

» Role of Actively Managed Funds

– Markets are not easy now
– Sector rotation, volatility, global factors are high

Actively managed funds help because:
– Fund manager adjusts allocation
– Can move between sectors
– Can protect downside better

This increases probability of achieving your 10% target.

» Rebalancing – Hidden Power

Every year:

– If equity grows fast → shift some to debt
– If market falls → shift some from debt to equity

This simple step:
– Controls risk
– Improves long-term return

» Time Horizon Understanding

– 5 years is a moderate horizon
– Equity can be volatile in short term

So:
– Do not expect straight-line returns
– Some years may be 5%, some 15%

Average matters, not yearly return

» Tax Efficiency Advantage

– Equity mutual funds:

Gains up to Rs 1.25 lakh → tax-free

Above that → 12.5%

– Debt funds: taxed as per slab

So equity-heavy allocation helps in post-tax return also

» One More Practical Insight

Instead of asking:
“Will I get 10% every year?”

Better question:
“Is my portfolio designed to beat inflation over time?”

Your plan above answers this correctly.

» Finally

You cannot control market returns. But you can control:
– Asset allocation
– Discipline
– Rebalancing

With your Rs 50,000 monthly investment:
– A balanced allocation like above can reasonably target 9–10% average
– More importantly, it will protect your capital and grow it steadily

This is how inflation is beaten in real life.

Best Regards,

K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in

https://www.linkedin.com/in/ramalingamcfp/

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