The Economic Times
English EditionEnglish Editionहिन्दीગુજરાતી
| E-Paper
Search
+

    Will these mutual funds help me build a corpus for my retirement?

    Synopsis

    If you have any mutual fund queries, message on ET Mutual Funds on Facebook. We will get it answered by our panel of experts.

    iStock
    I have been investing in HDFC Equity Fund, DSP Small Cap Fund, Nippon India Small Cap Fund (Rs 2,000, Rs 1,000, Rs 2,000 respectively) for past eight years. I also started SIPs in Axis Long Term Equity, Axis Bluechip Fund (Rs 5,000, Rs 3,000 respectively) for past one year. I am investing for the long term. Please advise if it is enough to cover my retirement.
    PS: I have also been investing Rs 5,000 in NPS for past one year.
    --Karthika Pathy

    Ashish Modani, founder, SLA Financial Solutions, responds:
    With changing economic landscape, disruptive technology and advanced medical facilities, many individuals would be facing shorter working life and longer retired life. I do not know your age, expected retirement age, and current expenses, so it's not possible for me to calculate your expected retirement corpus.

    I have noticed two things from your question

    One, there is no element of debt in your planning. Equity is a great long-term asset but all long-term investment should not be in equity. Build debt in your portfolio by adding PF/PPF. You should also invest in Gold. Keep investing some portion in Sovereign Gold Bond as well.
    Things You should consider
    • Annualized Return
      for 3 year: 9.05%
    • Suggested Investment
      Horizon: >3 years
    • Time taken to double
      money: 4.10 Years
    HDFC Equity Fund-Growth ★★★★★
    Things You should consider
    • Annualized Return
      for 3 year: -2.2%
    • Suggested Investment
      Horizon: >3 years
    • Time taken to double
      money: 3.0 Years

    Two, you have also added two funds from Axis Mutual Fund. More often, schemes are chosen on the basis of their recent performance. Do you know that in 2017, Axis Funds were one of the worst performing funds in their category. Those days, investors never used to prefer Axis funds, rather used to withdraw their money.

    Since you want to invest for the long haul, it is important that you know that you will never be able to have the best funds all time during your investment horizon. Rather, getting the best funds is more a matter of chance than any intelligence. Focus on asset allocation. This is why I have advised you to have a proper mix of debt and equity. As long as you are far away from retirement, have a major portion in equity and as you are nearing your retirement, reduce your level of equity.

    Do not try to chase return by eyeing the best schemes, do not try to maximise return and do not try to time the market. Keep things simple and remain disciplined throughout the tenure of your investments.I would also advise you to have a financial advisor. Remember, the journey to retirement is long and full of ups and down. A financial advisor by your side would be a great help.



    (If you have any mutual fund queries, message us on ET Mutual Funds on Facebook. We will get it answered by our panel of experts.)

    Also Read

    4 Comments on this Story

    FININVEST Mutual funds35 days ago
    Dear KP, glad to know that u r planning for retirement the most neglected financial goals of indians.
    keep on adding a good debt scheme sip as ur income grows
    Kishorerita Shivani35 days ago
    MFS ARE TAKING EVERY ONE FOR A RIDE THE DIVIDEND PAID IS DEDUCTED FROM THE CAPITAL INVESTED AND WHEN DIVIDEND IS PAID NAV COMES DOWN CHECK THE INVESTMENT MADE 5 YEARS BACK WHEN SENSEX WAS 27000 AND THE NAV AT THAT TIME. CHECK THE NAV WHEN SENSEX IS 34000 FIND THE VALUE OF INVESTMENT TODAY ADD TO THIS THE DIVIDEND RECD IN LAST FIVE YEARS THE VALUE OF PRESENT INVESTMENT PLUS DIVIDEND RECD IN 5 YEARS IS LESS THAN THE ORIGINAL INVESTMENT HDFC IS THE GREATEST CULPRIT IN MANUPILIATING THESE FIGURES THEY MAKE WINDFALL PROFITS AT EXPENSE OF THE INVESTOR ADITYA PURI IS THE GREATEST CROOK HE CHEATS INVESTOR'S TO GET HIMSELF HEFTY BONUSES
    Praveen Muthaiya36 days ago
    Thanks. It will very useful For me
    The Economic Times