Rudolf: I am 46 years old and want to build a portfolio of Rs 2 crores.
First of all, thank you for taking the time to review questions from viewers. I would be really grateful if you could review my investment portfolio. I invest Rs 64,000 rupees every month in a direct mutual fund and my plan is to continue this for the next 10 years. Thank you!
Previously, I used a broker for my investments but now I have stopped using their services and kept those funds as they are.
Currently, I am investing in the following mutual funds through the Coin app:
ICICI Pru Bluechip - Rs 12,000
Mirae Asset Emerging Bluechip - Rs 4,000
Axis Mid-cap - Rs 5,000
HDFC Mid-cap Opp - Rs 5,000
Axis Small-cap - Rs 6,500
Quant Active - Rs 6,500
Parag Parikh Flexi-cap - Rs 8,000
UTI Nifty 50 - Rs 6,000
Navi Nasdaq - Rs 6,000
Tata Digital Industries - Rs 5,000
Please check the overlap ratio of each fund in your portfolio when you add.
The lesser the overlap ratio, the better it is for your investments.
There is no meaning in buying the same underlying stocks through different funds.
If you find it difficult to decide the overlap ration or allocation, you can consult with financial planner or a professional mutual fund distributor who will be able to suggest and review periodically.
Anonymous: I have Rs 10 lakh in FD which I want to move into MF.
Please suggest some fund for lump sum amount to invest for 5-7 years.
FD is a risk-free asset but will not beat inflation. Also, it is not tax efficient.
Debt mutual funds have low risk. Again, this also will not beat inflation. Tax deferment is possible.
Equity funds have high risk. This will surely beat inflation in the long run. Tax efficient.
Instead of lump sum, you may consider an STP (systematic transfer plan) in actively-managed diversified equity funds, if you have the right financial planner/ professional mutual fund distributor.
If you want to do it yourself, then you can settle for conservative index funds.
Subho: I am 43 years old. I have a monthly SIP of Rs 35k going on.
I have started investing in mutual funds via SIP from the year 2013.
Total mutual fund current market value is Rs 1.9 crores.
I plan to invest 35 k per month more for 7 to 8 years when I want to leave job and do something else.
Can you tell me what will be my corpus in 7 to 8 years down the line, taking both current valuation plus what I am going to continue investing?
Also, I have another Rs 1 crore total in other investments like voluntary provident fund, EPF, PPF and ESOPs from my company and pension fund.
Here i do a monthly investment of around Rs 80k via mostly through company for tax savings.
So what will be my total corpus after 7 to 8 yrs?
Also, is it good for retirement considering my current monthly expense is Rs 1 lakh?
You are on the right track Subho.
Longevity has increased. Post-retirement risk free interest rate has come down. Inflation has gone up.
So when planning for retirement corpus, back-of-the-envelope calculations won't work.
You need to project your financial life from now to retirement and retirement to life expectancy.
If it is not possible for you to do that, then approach a financial planner who will be able to create a financial roadmap.
What are long-term capital gains and short-term capital gains?
You get short-term capital gains if you redeem your equity fund units within one year.
These gains are taxed at a flat rate of 15 per cent, irrespective of your income tax bracket.
You get long-term capital gains by selling your equity mutual fund units after holding them for over one year.
These capital gains of upto Rs 1 lakh a year are tax-exempt.
Any long-term capital gain exceeding this limit attracts LTCG tax at 10 per cent without indexation benefit.
Munim: Hi, I am 45 years old.
I have invested in Mutual Funds through lump sum and the invested corpus is Rs 33 lakhs (market value of Rs 32 lakhs as on date).
Have 4 LIC policies of 25 years plans (cumulative annual premium of Rs 1.1 lakhs and 10 years left for maturity).
Loans and liabilities are around Rs 35 lakhs (home loan and others).
Present monthly expense is Rs 1 lakh.
How much corpus would I require to live leisurely after 60 (life expectancy of 80) without compromising on lifestyle and increased medical needs?
I expect to work till 60 but with the present uncertainties going on, may be next 15 years would go on making the liabilities nil.
Am I on track Sir?
If not, what do I need to invest more (lump sum) and how many years of growth should the investment get to give me the required returns?
LIC policies -- review them and decide whether to retain or surrender. Most of the endowment policies deliver an IRR of around 5 per cent.
MFs -- Please review the schemes with a good MFD or RIA.
Please consult a certified financial planner for the corpus calculation.
In most of the cases, a CFP will be capable of completing all the three for you.
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Any use of the information/any investment and investment related decisions of the investors/recipients are at their sole discretion and risk. Any advice herein is made on a general basis and does not take into account the specific investment objectives of the specific person or group of persons. Opinions expressed herein are subject to change without notice.