Equity MF choices for reasonable and high-risk buyers

I’m 40 years outdated and earn ₹70,000 a month. I’ve two daughters, aged 2 and seven. Please counsel some good mutual funds for funding to satisfy their training and marriage bills, and the month-to-month SIP quantity for this.

— Name withheld on request

With 4 upcoming long-term monetary necessities, it’s crucial that you simply begin your funding journey instantly. 

You ought to make investments as a lot as you may—with the thumb rule being that you must make investments 20% of your month-to-month in-hand wage. That would come to ₹15,000 in your case. You can create two completely different portfolios—one for every daughter and make investments ₹7,500 in a three-fund portfolio every. Such a portfolio might develop to ₹18 lakh in 10 years and ₹38 lakh in 15 years. They can be utilized totally or to complement your training and wedding ceremony bills. 

When it involves the portfolio, please have a large-cap index fund (UTI Nifty Index), a flexi-cap fund (Parag Parikh Flexi cap), and a hybrid fund (ICICI Prudential Balanced Advantage). 

You can have the identical funds in each portfolios, however conserving them distinct will permit you to preserve monitor of every daughter’s requirement individually and plan your withdrawals appropriately.

I’ve been getting very poor returns from IDBI Equity Advantage, which I invested in six years in the past. Should I exit the fund instantly and make investments the proceeds in different funds? 

— Name withheld on request

You’re proper that the IDBI Fund has not executed effectively through the course of your holding. It can be a good suggestion to change out of that into higher funds. 

The fund you’re holding presently is a reasonable danger equity-oriented hybrid fund. If you wish to preserve your portfolio danger degree reasonable, you may think about shifting to ICICI Prudential Balanced Advantage Fund. Else, in case you are inclined in direction of larger danger, then think about a portfolio of Parag Parikh Flexi Cap Fund and SBI Small Cap Fund.

Srikanth Meenakshi is co-founder, PrimeInvestor

Subscribe to Mint Newsletters

* Enter a sound e mail

* Thank you for subscribing to our e-newsletter.