Mutual fund investments: How to invest in mutual funds to build a 25-lakh corpus
I have a corpus of Rs 15 lakh after surrendering my LIC policy. I want to invest this amount for the goal of my daughter’s higher education. I have an investment horizon of four to five years. I would like to build a minimum of Rs 25 lakh corpus. Could you suggest some mutual funds? Can I invest some amount in mid- or small-cap funds for better returns?
Dev Ashish Founder, StableInvestor, and Sebi-registered investment adviser: With a starting capital of Rs 15 lakh, your investment needs to earn 10.8-13.6% to reach the target of Rs 25 lakh in four to five years.
While the goal for your daughter’s higher education is four to five years away, the fee payment will be staggered over three to four years, with later payments due after over seven years. If your risk appetite allows, consider investing a portion in equity to achieve your target. For a moderately aggressive risk profile, you may put 20-25% in equity savings/ conservative hybrid fund (lump sum); 35-40% in multiasset/aggressive hybrid fund (staggered); and 35-40% in flexi-cap fund (staggered).
Avoid mid- and small-cap funds due to the current market risks. Diversify investments and ensure you have a sufficient term life insurance policy to fully cover your daughter’s education goal.
I am 51 years old and earn Rs 52 lakh annually. I invest Rs. 1 lakh monthly in mutual funds and retirement plans, and am expecting Rs. 2 crore at the time of retirement, along with a Rs. 1 crore inheritance. I own a flat worth Rs. 1 crore in Pune, which yields Rs. 28,000 rent, after Rs. 5,000 maintenance. I have one year worth of home loan EMIs left to pay. My wife owns a flat in Navi Mumbai, which too is rented. Should I sell my flat and invest in balanced funds via an SWP, or hold
