The advice given is based on the performance of the funds, the risk profile of the investor as well as his financial goals.
I. Chitra Rao is saving for her son’s education and her retirement. Here’s what the doctor has advised:
Goals
Portfolio recommendations
Portfolio check-up
- Investing in mix of equity, debt and hybrid funds for past 7-8 years.
- Holds too many overlapping funds. Needs to pare portfolio.
- Has not mentioned investments in fixed income and retirement schemes.
- Retirement goal of Rs 1 lakh per month is very ambitious. Must cut by 50%.
- SIPs have to be hiked by 10% every year.
Note
from the doctor
- Shift from debt funds to tax free PPF.
- Opt for maximum exposure to equity funds in NPS.
- Review investments and rebalance at least once in a year.
- Reduce risk when goal is near so that you don’t miss the target.
II. Remove laggard funds from portfolio
Sanjeev Guha is saving for his children’s education and retirement. Here’s what the doctor advised:
Goals
Portfolio recommendation
Portfolio check-up
- Investing in equity funds for past five years.
- Early start and regular investing have helped amass sizeable corpus.
- Present investments are fine but increasing SIPs every year will reach goals before time.
- Review mutual fund portfolio at least once a year. Change if any fund’s performance slips.
- Reduce risk when goal is near so that you don’t miss the target.
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.
