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Ramalingam Kalirajan |10881 Answers |Ask -Follow

Mutual Funds, Financial Planning Expert - Answered on Jul 30, 2025

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

Question by Jyoti on Jul 07, 2025Hindi

My sister is 25 yr old and earned 30k per month. She want to make investment for gold of her marriage that will be in end of this 2025. What are the good investment for her?

Ans: Your sister’s early thought towards saving is truly great.
Planning ahead for a personal goal like gold for her wedding shows maturity.

She still has about 1.5 years.
This time can be well used to plan better returns.

She earns Rs. 30,000 per month.
Let’s try to allocate her income wisely towards her short-term goal.

? Understanding the Goal First

– Her goal is to buy gold before December 2025.
– It is a short-term and non-negotiable goal.
– The value of gold fluctuates.
– Gold prices generally rise over time.
– She should avoid taking too much risk.
– Liquidity is also important.

? Avoid Investing in Equity-Based Options

– She has only around 17 months left.
– Equity is volatile in the short term.
– It may not give stable returns by 2025.
– A market correction can spoil the plan.
– For short goals, safety is more important.
– So, equity mutual funds are not suitable.

? Choose Safe and Short-Term Oriented Options

She should go with low-risk and liquid investments:

– Bank recurring deposits for 12-15 months.
– Debt mutual funds with low duration.
– Post office monthly income schemes.
– Fixed deposits with flexible closure option.

These options offer:

– Capital protection.
– Predictable return.
– Easy liquidity before marriage.

? SIP in Low Duration Debt Funds

– Monthly SIP of Rs. 5,000 to Rs. 10,000.
– Choose low duration or ultra short-term funds.
– These are better than bank RDs in taxation.
– After indexation, returns may be tax-efficient.
– But gains will be taxed as per her income slab.
– She can redeem anytime before December 2025.

? Target Maturity Funds Can Also Help

– She may look at short-term target maturity funds.
– Duration should match her goal year.
– These funds invest in government and PSU bonds.
– No equity exposure, so less risk.
– Ideal if she wants better than FD returns.
– Redemption at maturity avoids exit load.

? Importance of Monthly Discipline

– If she saves Rs. 10,000 monthly, in 17 months, she’ll save Rs. 1.7 lakh.
– With modest returns, corpus may touch Rs. 1.8 to Rs. 1.85 lakh.
– This can help her buy gold comfortably.

? Don’t Buy Physical Gold Too Early

– Physical gold involves making charges.
– Prices can drop after she buys.
– Better to invest and buy closer to date.
– Avoid gold jewellery schemes with jewellers.
– They usually offer low or no returns.

? Digital Gold or Gold ETF Is Not Needed

– Digital gold has storage and trustee risk.
– Not regulated fully like mutual funds.
– Gold ETFs need Demat account.
– Not ideal for someone new to investing.

Also, ETF is like an index option.
As per current guidance, she should prefer actively managed funds.

? Should She Go for Direct Mutual Funds?

– Direct funds skip distributor commission.
– But they don’t offer advice or support.
– Wrong selection can impact her goal.
– Regular funds via MFD with CFP ensure right guidance.
– CFP helps her with the best fit for her timeline.
– Long-term cost of a wrong fund is high.

? Insurance Products Are Not Needed

– Insurance is not for investment.
– ULIPs and money-back plans offer poor returns.
– She should avoid LIC endowment policies.
– If she holds any such plans, she should surrender.
– Reinvest the proceeds in suitable debt mutual funds.

? Avoid Keeping Cash in Savings Account

– Savings account gives only 2.5% to 3% returns.
– Inflation will eat the value of her savings.
– She should move the idle funds into short-term debt fund.
– Auto-debit SIP makes saving automatic and easy.

? Use Emergency Fund Separately

– Marriage gold saving is a specific goal.
– She must not mix it with emergency fund.
– At least 3 months of income should be kept separately.
– This can be in liquid mutual fund or bank RD.

? Keep Reviewing the Goal Every 3 Months

– Prices of gold can change.
– Market returns may vary slightly.
– She should check the progress quarterly.
– Increase SIP if prices go too high.
– Don’t stop SIPs midway for any reason.

? Should She Consider Gold Mutual Funds?

– Gold funds mirror gold prices.
– No capital protection.
– Value may fall during redemption.
– She may not get the required quantity of gold.
– These are better for long-term diversification.
– Not suited for a short-term marriage goal.

? Focus on Safety More Than Return

– This is not the time to take high risk.
– Earning 6-7% return is enough now.
– Capital loss will hurt the goal.
– Her confidence in investing may go down.
– Better to reach the target safely.

? Final Insights

– Your sister is planning wisely at a young age.
– Keep the plan simple and goal-specific.
– Short-term debt funds are the best match.
– Regular SIP builds discipline and focus.
– Avoid equity and complex options now.
– Don’t choose direct funds or ULIPs.
– Stay in safe assets and track progress.
– Her smartness will surely shine at her wedding.

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

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