Investment tips: In your 30s or 40s? Age-based asset allocation strategies to grow your money

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equity funds. “If you want to limit the risk associated with equity markets, investing in ULIPs could be considered," said Agarwal “As you enter your forties, you may begin to rebalance your portfolio to incorporate a somewhat greater proportion of more stable investments, such as bonds. While equities can still play a substantial role, the portfolio should become more balanced as retirement approaches to limit possible volatility," said Gupta.

You can also consider investing in real estate for a home or to generate rental income. An effort should be made to have a balanced portfolio - that is - having 40% equity and 40% debt funds. “Around 5% should be kept as emergency cash.

Around 5% should always be maintained to take advantage of new opportunities," said Ajay Agarwal. Before considering how to invest during the different stages of your life, it's helpful to understand the concept of asset allocation. Often we come across the term asset allocation.

What is it? To put it simply, it means, you have to distribute the money that you want to invest among different assets like gold, real estate, stocks and mutual funds, bonds, PPF, and EPF. The manner in which you will distribute all these assets is known as asset allocation. Stocks (equities) Bonds (fixed-income securities) Cash and cash equivalents Other asset classes include: Commodities Real estate “If you put all your money into one asset class (i.e., all your eggs in one basket), and that class tanks, you have no hedge to protect your capital.

Investing in a variety of asset classes provides diversification in your portfolio. Here is how to invest in your 30s and 40s," said Ajay Agarwal. Experts say that individuals may gradually shift from equity to debt investments