Dear Ulhas , Thanks for your suggestion and apologies for replying late. When you mentioned to do SIP in remaining 3-4 years , is it after 10-12 years in equity or is it 6-7 years in equity and then 3-4 years of other funds ? Also can you tell me how much should I step up every year in the SIP amount so that I can get a target corpus of atleast 4-5 Crs as retirement fund and same for child education as well. You suggested the division of amount in MF category , can you please suggest MF in these category , I know past performance in not indicative of future but still it gives an approx. Idea . Best Regards, Prateek

Ans: You've got a diverse portfolio with exposure to flexi-cap, focused equity, large cap, and mid-cap funds, which is a good start. Given your goals and current investments, consider increasing the SIP amounts gradually to keep pace with inflation. For your daughter's education and marriage, consider adding a child-specific mutual fund or a separate investment plan targeting these goals. For retirement, diversify into debt funds or balanced funds as you approach retirement age for stability. For the house goal, consider adding a short-term debt fund to protect the principal. Regularly review and rebalance your portfolio to align with your goals and market conditions. Consulting a financial planner would provide personalized guidance.

Ans: Current Investment Overview
Age and Monthly SIP
Age: 23 years
Current SIP: Rs. 3,600
Portfolio
Small Cap Funds
Mid Cap Funds
Index Funds
Financial Goals
Accumulate Rs. 1 crore in 3 years
Accumulate Rs. 5 crores in 10 years
Accumulate Rs. 25 crores by the age of 50 (27 years)
Calculating Monthly SIPs to Achieve Goals
Goal 1: Accumulate Rs. 1 Crore in 3 Years
Achieving Rs. 1 crore in 3 years with SIPs is quite ambitious due to the short time frame. This would require very high returns which are unrealistic and risky. Instead, consider a mix of equity and debt funds to achieve a more balanced growth.

Goal 2: Accumulate Rs. 5 Crores in 10 Years
For this goal, we assume an average annual return of 12%. You would need to invest significantly higher amounts compared to your current SIP.

Goal 3: Accumulate Rs. 25 Crores in 27 Years
Assuming an average annual return of 12%, you will need to increase your SIP gradually as your income grows.

Suggested Monthly SIPs
For Goal 1
Monthly SIP: Approximately Rs. 2.5 lakhs (unrealistic with a balanced risk approach; consider adjusting the goal or extending the time frame)
For Goal 2
Monthly SIP: Approximately Rs. 2.5 lakhs
For Goal 3
Monthly SIP: Approximately Rs. 2 lakhs initially, increasing annually as your income increases
Diversified Portfolio Recommendations
Balancing Growth and Risk
Equity Funds
Large Cap Funds: For stability and consistent growth
Mid Cap Funds: For higher growth potential with moderate risk
Small Cap Funds: For aggressive growth but with higher risk
Debt Funds
Short-Term Debt Funds: For stability and to balance the portfolio risk
Corporate Bond Funds: For better returns compared to traditional savings
Suggested Portfolio Allocation
Large Cap Funds: 40%
Mid Cap Funds: 30%
Small Cap Funds: 20%
Debt Funds: 10%
Additional Strategies
Increase SIP Amounts Gradually
Annual Increase: Increase your SIP amount by 10-15% annually to leverage your income growth.
Bonus and Windfalls: Invest any additional income, bonuses, or windfalls to boost your portfolio.
Regular Review and Rebalancing
Quarterly Review: Check the performance of your investments quarterly.
Rebalancing: Adjust your portfolio to maintain the desired asset allocation and manage risk.
Focus on Long-Term Goals
Discipline: Maintain investment discipline and avoid impulsive decisions based on short-term market movements.
Education: Stay informed about market trends and mutual fund performance to make informed decisions.
Final Insights
Achieving your financial goals requires disciplined investing, a balanced portfolio, and regular reviews. While some goals may need adjustments, consistent efforts and strategic investments will help you build substantial wealth over time.

Best Regards,

K. Ramalingam, MBA, CFP

Chief Financial Planner

www.holisticinvestment.in

Ans: You are 23 years old and investing Rs 3,600 per month in SIPs. Your portfolio includes small-cap, mid-cap, and index funds.

Financial Goals Assessment

Goal 1: Accumulate Rs 1 crore in 3 years.
Goal 2: Accumulate Rs 5 crores in 10 years.
Goal 3: Accumulate Rs 25 crores by age 50 (27 years).
Monthly Investment Requirement

To achieve these goals, the current SIP of Rs 3,600 per month is not enough. You will need to increase your SIP amount significantly. Consulting a Certified Financial Planner (CFP) will provide precise guidance on the required SIP.

Portfolio Diversification

Your current portfolio is heavily inclined towards small-cap, mid-cap, and index funds. These funds can be volatile. Including large-cap and flexi-cap funds will balance growth and risk.

Disadvantages of Index Funds

Index funds often track the market. They may not outperform it. Actively managed funds, managed by experts, can offer better returns and risk management.

Disadvantages of Direct Funds

Direct funds need continuous monitoring. Regular funds, managed by a CFP, can offer professional advice, better management, and less hassle.

Additional Strategies

Increase SIP Amount: Regularly review and increase your SIP as your income grows.

Seek Professional Guidance: A CFP can help you choose the right funds and strategies.

Diversify: Balance your portfolio with large-cap, mid-cap, and small-cap funds to reduce risk.

Final Insights

Your ambitious financial goals require a substantial increase in your SIP contributions. Diversify your portfolio to include large-cap and flexi-cap funds. Seek advice from a Certified Financial Planner for tailored strategies and better management.

Best Regards,

K. Ramalingam, MBA, CFP,

Chief Financial Planner,

www.holisticinvestment.in