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I am 38 and I invest Rs 15,000 per month in mutual fund SIPs. Am I on the right track to build a corpus of Rs 1.5 crore in next 12-14 years?
I am 38 years old and invest Rs 15,000 per month through SIPs in four mutual funds (two large-cap and two flexi-cap funds). My goal is to build a corpus of Rs 1.5 crore in the next 12-14 years for my child’s higher education. Am I on the right track or should I diversify in mid- or small-cap funds for better returns? Also, how often should I review my portfolio?
Ravi Kumar TV Co-founder, Gaining Ground Investment Services: Your decision to invest systematically through equity funds for your child’s education is a good start. However, you are likely to fall short of the target corpus of Rs 1.5 crore with your current SIPs of Rs 15,000 a month over 12-14 years, unless the returns exceed 13% annually. Hence, you should consider increasing your monthly investment and also invest 20% in a good mid-cap or small-cap fund for higher growth potential over the next 10 years. You could replace one of your large-cap funds with a multi-cap fund, and one of the flexi-cap funds with a midcap or small-cap fund. Review your portfolio every year to check if it is progressing towards your financial goal, rather than reacting to short-term market fluctuations.
Also read | I want to build a corpus of Rs 1 crore in 10-12 years. Where should I invest?
I have invested in eight mutual funds through SIPs, all of which are direct (growth) plans: HDFC Mid Cap Opportunities Fund, Mirae Asset Large & Midcap Fund, SBI Blue Chip Fund, SBI Magnum MidCap Fund, UTI Nifty 50 Index Fund, Quant Multi Cap Fund, Parag Parikh Flexi Cap Fund, and Axis Small Cap Fund. I’m considering raising the amount allocated to these. Is it advisable to continue with these or should I look for new funds?
Ravi Kumar TV Co-founder, Gaining Ground Investment Services: Your current systematic investment plans (SIPs) are well-structured and offer good diversification across large-cap, mid-cap, small-cap, flexi-cap, multi-cap, and index categories, along with the fund’s investing style. Funds like Parag Parikh Flexi Cap, UTI Nifty 50 Index, and Mirae Asset Large & Midcap provide a strong foundation with a mix of long-term stability and growth potential. However, there is some overlap, particularly in the mid-cap space, with HDFC Mid Cap and SBI Magnum MidCap. You may consider continuing with just one to avoid redundancy. Quant Multi Cap, though aggressive and tactical, delivers returns only in momentum-driven markets, but comes with high short-term volatility. If you’re looking to increase your SIP amount, it may be more effective to add to funds like Parag Parikh Flexi Cap, Mirae Large & Midcap and HDFC Midcap Fund for longer periods. Overall, your portfolio is on the right track, and with a few tweaks, it can be optimised further for growth and stability.
Have a question for the experts? etwealth@timesgroup.com
I am 38 and I invest Rs 15,000 per month in mutual fund SIPs. Am I on the right track to build a corpus of Rs 1.5 crore in next 12-14 years?
I am 38 years old and invest Rs 15,000 per month through SIPs in four mutual funds (two large-cap and two flexi-cap funds). My goal is to build a corpus of Rs 1.5 crore in the next 12-14 years for my child’s higher education. Am I on the right track or should I diversify in mid- or small-cap funds for better returns? Also, how often should I review my portfolio?
Ravi Kumar TV Co-founder, Gaining Ground Investment Services: Your decision to invest systematically through equity funds for your child’s education is a good start. However, you are likely to fall short of the target corpus of Rs 1.5 crore with your current SIPs of Rs 15,000 a month over 12-14 years, unless the returns exceed 13% annually. Hence, you should consider increasing your monthly investment and also invest 20% in a good mid-cap or small-cap fund for higher growth potential over the next 10 years. You could replace one of your large-cap funds with a multi-cap fund, and one of the flexi-cap funds with a midcap or small-cap fund. Review your portfolio every year to check if it is progressing towards your financial goal, rather than reacting to short-term market fluctuations.
Also read | I want to build a corpus of Rs 1 crore in 10-12 years. Where should I invest?
I have invested in eight mutual funds through SIPs, all of which are direct (growth) plans: HDFC Mid Cap Opportunities Fund, Mirae Asset Large & Midcap Fund, SBI Blue Chip Fund, SBI Magnum MidCap Fund, UTI Nifty 50 Index Fund, Quant Multi Cap Fund, Parag Parikh Flexi Cap Fund, and Axis Small Cap Fund. I’m considering raising the amount allocated to these. Is it advisable to continue with these or should I look for new funds?
Ravi Kumar TV Co-founder, Gaining Ground Investment Services: Your current systematic investment plans (SIPs) are well-structured and offer good diversification across large-cap, mid-cap, small-cap, flexi-cap, multi-cap, and index categories, along with the fund’s investing style. Funds like Parag Parikh Flexi Cap, UTI Nifty 50 Index, and Mirae Asset Large & Midcap provide a strong foundation with a mix of long-term stability and growth potential. However, there is some overlap, particularly in the mid-cap space, with HDFC Mid Cap and SBI Magnum MidCap. You may consider continuing with just one to avoid redundancy. Quant Multi Cap, though aggressive and tactical, delivers returns only in momentum-driven markets, but comes with high short-term volatility. If you’re looking to increase your SIP amount, it may be more effective to add to funds like Parag Parikh Flexi Cap, Mirae Large & Midcap and HDFC Midcap Fund for longer periods. Overall, your portfolio is on the right track, and with a few tweaks, it can be optimised further for growth and stability.
Have a question for the experts? etwealth@timesgroup.com
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)
