Sir, im 37 yrs old married man with two children. I have around 40 lakh which i would like to invest for better future of my children along with getting some fund for self & wife during oldage. Please guide.
Ans: You have Rs 40 lakh to invest. Your main goals are securing your children’s future and ensuring financial stability for yourself and your spouse during old age. This is a significant amount, and it’s crucial to allocate it wisely to achieve these goals.
Allocating Funds for Children’s Future
Education Fund: Invest a portion in child education-specific mutual funds. These funds are actively managed and can help in building a substantial corpus over time. Regularly review the fund’s performance with a Certified Financial Planner.
Long-Term Growth: Consider investing in equity mutual funds for long-term growth. Equity funds, managed by professional fund managers, can potentially offer higher returns over time.
Securing Your Retirement
Retirement Corpus: Allocate a portion to retirement-focused mutual funds. These funds, actively managed, can help in growing your corpus while mitigating risk.
Systematic Withdrawal Plan (SWP): Once you retire, you can opt for SWP from your accumulated corpus. SWP provides a regular income, which can be beneficial in managing expenses during retirement.
Balancing Safety and Growth
Debt Funds: For a balanced approach, invest in debt funds. These funds offer stable returns with lower risk, making them ideal for preserving capital.
Diversification: Ensure your investments are diversified across different asset classes. This reduces risk and increases the chances of achieving your financial goals.
Regular Review and Adjustment
Periodic Review: Regularly review your investments with a Certified Financial Planner. Adjust the portfolio as needed based on market conditions and your changing financial needs.
Emergency Fund: Keep a portion of your funds liquid in case of emergencies. This ensures you are not forced to withdraw from your long-term investments.
Final Insights
Avoid ULIPs and Insurance-Based Investments: These often combine insurance with investment, leading to higher costs and lower returns. Instead, focus on pure investment products and separate term insurance for adequate coverage.
Active Management: Actively managed funds often outperform passive index funds, especially in the Indian market. Ensure your investments are in funds managed by experienced professionals.
Investing with a clear strategy can help you secure your children’s future and ensure a comfortable retirement for yourself and your spouse. Regular reviews and adjustments are essential for staying on track.
Best Regards,
K. Ramalingam, MBA, CFP,
Chief Financial Planner,
www.holisticinvestment.in
