Govt employees should proceed investing in PF for accumulating wealth for retirement

I’m working in CBI as a stenographer (central govt. job) since 1999. My take-home wage for the month of Oct 2021 is ₹57,000 and my month-to-month expenditure is about ₹35,000. Although I’ve accomplished 21 years of service however couldn’t in a position to deposit good cash in any manner besides buying 2-3 small insurance policies like SIP of ₹2000 month-to-month since final 3-4 years, LIC coverage of ₹2 lakh and many others. Except these ₹7-8 lakh in GPF. How ought to go about investing my monies?

Now I’m to hold out the expenditure of training of my solely daughter who’s going for commencement subsequent yr then the expenditure of her marriage incoming 7-8 years. Except for these, I additionally need to buy a home however I do not need a lot cash for the above-mentioned expenditures. I’ve solely left 12 years of my service. It is, due to this fact, requested that please information/recommend me appropriate plans for earning profits to hold out the above-mentioned expenditures.

-Name withheld on request

We recommend persevering with together with your investments in GPF for accumulating the wealth to your retirement wants. However, your ongoing investments in LIC coverage will present the life cowl until the coverage time period together with maturity corpus.

For additional wealth creation to realize your targets, we recommend you put money into equity-oriented mutual fund schemes. Considering SIP funding of ₹22000 (month-to-month financial savings) for the remaining service time period and assuming 12% p.a. returns from fairness funds, you might be able to accumulate ~70 lakh roughly in 12 years. You might take into account a wholesome mixture of Large & Mid Cap, Flexi Cap & Value Funds in your portfolio for the investments. You can select Axis Growth Opportunity Fund & HDFC Large & Mid Cap Fund in Large & Mid Cap class, UTI Flexi Cap Fund & Parag Parikh Flexi Cap Fund in Flexi Cap class and IDFC Sterling Value Fund in Value class.

I’m 26 years outdated and my revenue is 30,000 per thirty days. I’m investing ₹1.5 lakh each year in PPF. Please recommend any mutual fund to put money into to gather a giant corpus in 15 years.

-Name withheld on request

It is a smart resolution to take a position ₹1.5 lakh p.a. in PPF. This won’t solely give you wealth creation but in addition the tax advantages yearly beneath part 80C of the Income Tax Act. Considering your early age, we recognize your resolution of investing in Mutual Funds. You can construct your portfolio via SIP funding in Mid Cap, Small Cap, Value and Flexi Cap Funds over a interval of 15 years. You can consider equally dividing your month-to-month SIPs into Mirae Asset Mid Cap Fund, Kotak Small Cap Fund, IDFC Sterling Value Fund and Parag Parikh Flexi Cap Fund.

Sanjiv Bajaj, Joint Chairman and MD, Bajaj Capital. 

(Queries and views at mintmoney@livemint.com)

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