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MF Portfolio Doctor: Why Bhatias need to focus on saving for critical money goals

The Portfolio Doctor assesses the health of the portfolio, examines the schemes and their suitability with regard to the goals and recommends corrective measures.

ET CONTRIBUTORS|
Updated: Sep 09, 2019, 10.00 AM IST
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Avoid direct equity investments unless you have the time and expertise to research.
Not many investors know whether they have invested in the right funds and if their fund portfolio is on track.

The Portfolio Doctor assesses the health of the fund portfolio, examines the schemes and their suitability with regard to the goals and, if required, recommends corrective measures. 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: Prateek Bhatia and his wife save for travel and retirement. Here’s what the doctor has advised them.

Goals
Bhatia-goals


Investor’s existing portfolio
Bhatia-portfolio


Portfolio check-up
  • Early start in equity funds gives distinct advantage.
  • Holds too many funds. Need to reduce clutter.
  • Not saving for any goal other than holidays and retirement.
  • Start saving for other critical goals (house, children, etc)
  • Avoid direct equity investments unless you have the time and expertise to research.

Note from the doctor
  • Don’t buy too many funds. Just 6-7 funds from 2-3 categories are enough.
  • 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: Vaibhavi Pawar is investing for her son’s goals and retirement. Here’s what the doctor has advised.

Goals
Pawar-Goals


Investor’s existing portfolio
Pawar-portfolio


Portfolio check-up
  • Started investing in equity funds recently. Investments in losses but goals far away.
  • Ambitious goals will require higher investments. SIPs to be hiked by 10% every year.
  • After education goals are met, direct SIPs for marriage goal and retirement.
  • Review portfolio at least once a year. Change if any fund’s performance slips.

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.
(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.)
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