mutual: I am 50 years old; in which mutual funds to invest in order to build up a “good” corpus in 8 years?

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I am 5 years old
0 and wants to start investing in mutual funds to build a good body by the age of 56-58. I can invest 10,000 to 12,000 Rs per month. I also invest Rs 4,500 per month in NPS and Rs 10,000 in PPF. How do I proceed?

Dev Ashish, Founder, StableInvestor and Sebi Registered Investment Advisor responds: It sounds like your new plan is about increasing your retirement corpus, and rightly so. I think the monthly Rs 4,500 in NPS goes to the additional Rs 50,000 tax benefit for level 1 accounts. Assuming Active mode is chosen and you plan to have at least 50-60% equity (or as much as allowed due to age allocation restrictions after 50) you will have accumulated around Rs 5-7 lakh. But keep in mind that this NPS corpus may need to be used in part to purchase an annuity later. The Rs 10,000 monthly PPF is expected to accumulate around Rs 8-12 lakh in 6-8 years assuming average interest rates over the remainder of the term will be lower than the current 7.1%. The actual corpus in both PPF and NPS would be higher because you would already have existing investments in both. For your MF investments, assuming a 10-12% return, you can expect a corpus of Rs 12-13 lakh or Rs 18-20 lakh if ​​you invest Rs 12,000 per month for 6 and 8 years respectively. Although I do not know your risk appetite, but with some assumptions, I suggest that you choose only two funds in which to invest. You can have an index fund (based on Nifty / Sensex) and a flexi-cap fund. Or you can just go for two index funds based on Nifty / Sensex and Nifty Next50. These pure equity funds should suffice. Note that in the following years, it would be prudent to reduce your exposure to equities (after reviewing your overall asset allocation) to help you smoothly cross the retirement threshold without having to worry too much about the risk of bad sequence of returns. If you are unsure of how to handle the crossover, please contact a Sebi Authorized Investment Advisor.

I am 25. My EPF deduction per month is Rs 6,000. I have a level 1 NPS with a 75% equity allocation and I invest Rs 50,000 per year. I have a PPF where I invest Rs 1,000 per month and an LIC (Jeevan Labh) policy with an annual premium of Rs 70,000. I have only invested in ELSS funds on a lump sum basis for the past four years for tax savings. I am now running SIPs in several equity mutual funds. Please let me know if my portfolio is suitable for a 20-25 year horizon. I have personal health insurance and term insurance. The SIPs are as follows: Rs 5,000 each in Axis Growth Opportunities Fund, Mirae Asset Tax Saver, Parag Parikh Flexi Cap, Mirae Asset Mid Cap, Canara Robeco Small Cap Fund and Motilal Oswal NASDAQ 100 FoF. I also plan to add Axis Flexi Cap Fund.

Vidya Bala, co-founder of PrimeInvestor.in, says: “You have just under 20% debt, which makes it an aggressive allocation. If you can handle the volatility, that’s fine. Otherwise, add short-term debt funds. small cap and that also makes the portfolio a bit aggressive. If you plan to add more, use index funds such as UTI Nifty 50 or Axis Nifty 100 to provide exposure to large caps. The funds you hold are fine. Canara Robeco Small Cap does not have a sufficient track record for us to be able to provide an opinion. ”


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