Are you always at a loss while planning your finances? Are you aware of the investment options available in the market?

How best can you plan your finances?  What are the crieria for evaluating an investment option?

Are mutual funds profitable investment options? When and how should one buy mutual funds?

In an hour-long chat on rediff.com, financial planning expert Irfan Rupani replied to many such readers' queries. Here is the transcript:

irfan says, good afternoon everyone, lets begin!

manoj asked, is it good time to save in mutual funds
irfan answers,  at 2008-07-02 13:00:29yes, it is. an sip investment is always advisable, especially in a scenario like the present one. if you have an existing sip, you can consider making lumpsum investments in a staggered manner.

balavijayakumar asked, Sir, I have invested my very hard earned money of Rs.1 Lakh in MFs like Sundaram Paribas Select Focus, SBI [Get Quote], DSP, UTI and Reliance [Get Quote], all in Growth options during December last year and early January. Now, since the market is in downward trend, I fear regarding my investment. Please suggest what should be done?
irfan answers, hi, if you can provide a bit more information of the funds you have invested in, we can advise you better. AMCs like Sundaram and DSP ML are well-managed ones. so long as you have a 3-5 year investment time frame, it should be okay.

nadu asked, sir what about fidelity tax saver and principal personal tax saver fund if i invest 15000 each now your opinion please???
irfan answers, hi, at personalfn, we like fidelity tax saver fund on account of its processes.

justformanoj asked, Is it good time to save in Mutual funds for tax planning. If yes in which type of mutual funds
irfan answers, hi, yes it is a good time to invest in tax-saving funds so long as your risk appetite permits the same. we had recently dealt with this in an article: http://www.personalfn.com/detail.asp?date=6/24/2008&story=5

novice asked, dear irfan, if i had to invest 10k pm in sip what should i do?
irfan answers, hi, your risk appetite, investment objective and investment time frame will play an important part. you can write to info@personalfn.com for guidance in this regard

Ragoth asked, what is your advice on unit-linked insurance plans in terms of portfolio choices?
irfan answers, hi, before opting for a ulip, we recommend that you first take a term plan (which is the cheapest form of life insurance) for an adequate cover. while buying a ulip, make sure you understand the cost implications and are willing to make a long-term commitment. don't fall for the 3-yr investment policy spread by insurance agents.

ulla asked, Hi, I have monthly SIP in HDFC [Get Quote] equity 1000, dspml tiger Rs2000, sbi contra Rs1000, icici service ind Rs.1000. Pls give your suggestion on my MFs. SBI & ICICI [Get Quote] SIPs are going to end in next 2 months. Pls suggest me whether should i continue the SIP again or not? and also is it the right time to continue SIP or wait for few more months?
irfan answers, hi, barring hdfc equity, all your investments are in thematic funds. these are typical high risk high return investments. they tend to rise and fall sharply vis-a-vis markets. can't comment on what is likely to happen over the short-term.

sona asked, Reliance Vision Fund - Equity - Diversified, Reliance Diversified Power Sector Fund, DSP ML Tiger Fund - Equity, Fidelity Equity Fund, Birla Sun Life - Equity Fund, Reliance Growth Fund , HDFC Top 200 Fund, how good or bad?
irfan answers, hi, we like hdfc top 200 and fidelity equity. also your portfolio suggests that you are missing out on AMC diversification. thematic funds like reliance div. power and dsp ml tiger will move in line with the underlying market trends of those themes.

Ramesh asked, Dear Irfan, Could you please suggest me if I can allocate a savings of 10K per month, which could be the right option to invest? MF/NAV's or Chitfunds?
irfan answers, hi, most chitfunds are unregulated and we advise against them. we believe investors are better off investing in mutual funds.

sandy asked, Sir , is it advisable to exit from a ULIP after 3 years and reinvest the amount eleswhere.
irfan answers, hi, you are likely to caught wrong-footed on account of the high charges in the initial years. the situation can only worsen in markets like the present one. like mutual funds ulips should also be invested with a long-term investment horizon. at the end we recommend you consult your insurance agent.

Kaushal Dhiman asked, Hi, I have never had the guts to get into stocks / mutual funds, although they seem to be very tempting. Looking at the market slow down, do you think, I should give it a try ?? I have always invested only in property. Kindly advice...
irfan answers, hi, both stocks and mutual funds should form part of your asset allocation along with property. by investing only in property, you are losing out on diversification at an asset class level. before investing in equities get a reality check on your risk appetite.

suneshkraj asked, what is career prospective of a MF advisor? please advice.
irfan answers, hi, you should do well for yourself so long as you put your client's interests above your own. being well-informed about the various developments in the financial space as also your client's needs and objectives is a prerequisite.

Anurudh asked, What Mutual Funds would you suggest if I have to invest 10K at this point of time with 2-3 years horizon?
irfan answers, hi, at personalfn, we recommend that equity investments must be made with a minimum 3-5 year investment time frame. if your risk appetite permits, we recommend that you start off with a well-managed diversified equity fund with a long-term track record.

Palamon asked, WHAT ARE THE GUIDELINES ONE SHOULD FOLLOW IN CHOOSING A MUTUAL FUND? CAN YOU SUGGEST ONE FOR SOMEONE WITH A MODERATE RISK APPETITE?
irfan answers, hi, to know more please read our article: http://www.personalfn.com/detail.asp?date=6/6/2008&story=1

Ragoth asked, Is a 12% returns rate realistic over a 3-5 year period? What is the best way to achieve this?
irfan answers, hi, in a well-managed diversified equity fund, it is a realistic rate of return.

rupali asked, Dear Irfan, Hi! I've invested 1.5 lac in ICICI Pru - Dynamic Plan (20k), ICICI Pru - Power Plan (20k), ICICI Pru Infrastructure (35k), Tata - Equity Opp. Fund (20k), Sundaram - BNP Paribas Tax Saver OE (20k), JM - Basic Fund (15k), Reliance - Diversified Power Sector (20k). Does my portfolio requires any change? Further i'm planning to invest 50,000 more in my porfolio. What funds do you suggest? I've one 1 yr old and have at least 5 years of investment time with medium risk appitite
irfan answers, hi, your portfolio is not suited for a medium risk taking investor. there are too many thematic funds/aggressively managed funds. there is a case for including balanced funds and conservatively managed equity funds.

Mandar asked, Hi, Mr. Irfan, I have been investing Rs.25000/- as SIP (5000/- eachx 5 SIPs) in different MFs. Should I discontinue it in view of drastic collapse of market and restart later? Thanks for your time and advice. -Mandar
irfan answers, hi, assuming that you are convinced about the prospects of your investments, investing through an sip in these markets is a good idea. don't time the markets, instead stay invested for the long term.

uday1 asked, Hi Irfan, what do you feel about investing today in SBI Blue Chip (D) fund?
irfan answers, hi, we reviewed the fund not so long ago and its performance was not very encouraging. there is an article on our website on this fund.

kamal asked, gud afternun, irfan !!! well i am 26 and i have satrted investing in various plans . i invest 1000 in sbi contra and 100 in sbi growth and 2000 in R.D. i m still unmarried and a year after i will get married and responsibilities will be there. i m in my own home. i m getting a package of 3.50L. now seeking the future aspect what would you suggest me to invest in and how to invest seeking the inflation and salary ratio.,, So that i could earn 1 CRORE till i reach an age of 55 years.
irfan answers, hi, becoming a crorepati isn't as tough as it is made out to be, all you need is regular investments in a disciplined manner. visit our crorepati calc to know more: http://www.personalfn.com/asset/activitycentre/crorepati1.html

rrr asked, I have sundaram paribas,reliance regular saving,tata infrastructure,reliance diversified power sector,magnam contra,infotech fund.....Is it a well diversified investment
irfan answers, hi, unfortunately you have a very thematic/sectoral heavy portfolio. it will not qualify as a diverisified portfolio at all.

Raman asked, Hi,Irfan, I would like to know which MF is good at this time when the market is only sliding down each day. We have invested in HDFC Standard Life Insurance Pension Fund, however we are seeing the NAV going down, we have lost over 15%. Pl advise.
irfan answers, hi, you seem to have invested in a ulip and not a mutual fund. with regards to mutual funds, we can advise only after knowing about your investment objective and investment time frame. incidentally, the markets going down should be seen as a good time to make investments in a staggered manner for the long-term and not as a cause for concern.

arindam asked, I have been investing in HDFC Equity and Reliance Vision through SIP since 2006. Right now my portfolio is in RED. Could you kindly direct me what to do next. I am seriously tensed. Please help me.
irfan answers, hi, if you are a long-term investor (with a horizon of at least 3-5 years), you should do well.

Chavan asked, Hello Irfan, I am NRI for short time like 1-2 years, I would like to invest in MF and Equity for both long term and short term, please can you suggest which are the good options? recently, I have taken Rs.50000/- ULIP from ICICI Pru and the fund value drasticlly came doen to 35 K..so littel I secred..please suggest.
irfan answers, hi, don't opt for equities if you have a short-term investment horizon. we recommend debt-oriented investments like mips and fmps (based on your investment objective) for a 1-2 year horizon.

drsuresh asked, My loss so far is 30% in mutual funds investment.What shoudl i do now?Should i buy more funds at this current level or remain with the old ones
irfan answers, hi, if your existing funds are well-managed and can help you achieve your objectives, take this opportunity to add to them.

Nija asked, What is the best mutual fund at present ( Now) with tax saving under 80c
irfan answers, hi,there is no such thing as a best mutual fund. even within the segment of tax-saving funds there are aggressively managed funds and conservatively managed funds. you need to pick what is right for you.

animanee81 asked, Hi irfan Is it a good time to invest in MF
irfan answers, hi, i have replied to a similar query before, you can refer to it.

sunilM asked, Hi. From the past 6 months or so all equity linked funds and infrastructure linked funds are down. How long do you think it will take to stabilise. Do you think MF are still the best options?
irfan answers, hi, i cant comment on when it will stabilise, but the long-term outlook continues to be positive. for investors who can take the risk, this is a good time to invest.

vivekkompella asked, Hi Irfan, most of my MF investments were done 2 years back, all of them still show negative. how should i plan for tax savings this year
irfan answers, hi, even for tax-planning it is important to make a portfolio based on your risk profile. if you can take risk, it should be dominated by tax-saving funds and ulips. for conservative investors it should be dominated by nsc, ppf and tax-saving fds.

amit joshi asked, Dear Irfan, If you have to invest Rs. 15000 in a MF at this point of time keeping this investment for a period of one year which MF would you opt for..Thanks..
irfan answers, hi, it would be not be in equity fund for sure. rather i would look at fmps and short-term debt funds.

vpashya asked, Hi, I have 30k to invest, which MF do u recommend. Should I invest lumpsum or througn SIP?
irfan answers, hi, sips are always the preferred mode. but in times like these you can also consider investing lumpsum in a staggered manner over and above your sip.

upashua asked, Is Sundram Select focus fund good?
irfan answers, hi, its an aggressively managed large cap fund. if that is what you are looking for, its the right fund for you.

irfan says, hi thank you all for participating in the chat. we have run out of time. please feel free to write at info@personalfn.com with your queries.