The advice given is based on the performance of the funds, the risk profile of the investor as well as his financial goals.
CASE I: Anurag Jauhari and his wife are investing for multiple goals. Here’s what the doctor advised them.
Goals
Investor’s existing portfolio
Portfolio check-up
- Invests in mutual funds, insurance, small savings and NPS.
- Holds too many funds. Needs to consolidate. Insurance dragging down performance.
- Rs 50 lakh target for all four child goals is not logical. Cut to Rs 25 lakh; adjusted for inflation.
- All SIPs will have to be hiked by 10% every year to reach goals.
- Deploy cash in bank in liquid scheme or short-term debt fund to earn better returns.
Note from the doctor
- Don’t buy insurance as investment. Returns are too low.
- Review investments and rebalance at least once in a year.
- Reduce risk when goal is near so that you don’t miss the target.
CASE II: Deepak Yadav is saving for his child’s education and his retirement. Here’s what the doctor has advised him.
Goals
Investor’s existing portfolio
Portfolio check-up
- Started investing in equity funds last year.
- Goals are ambitious and will require regular hikes in SIPs.
- Retirement target of Rs 2 crore after 20 years is too modest. Will yield Rs 25,000 a month (current value).
- Has not mentioned PF, small savings, NPS. Could obviate need for more investments.
- Review investments and rebalance at least once in a year
Assumptions used in the calculations
Inflation
- Education expenses: 10%
- For all other goals: 7%
Returns
- Equity funds: 12%
- Debt options: 8%
Portfolios analysed by Raj Khosla, Managing Director and Founder, MyMoneyMantra
Write to us for help
If you want your portfolio examined, write to etwealth@timesgroup.com with “Portfolio Doctor” as the subject. Mention the following information:
- Names of the funds you hold.
- Current value of the investment.
- If you have SIPs running in any of them.
- The financial goals for which you invested.
- How much you need for each financial goal.
- How far away is each goal.