MF Query Board

I am 34 years old and want to build a corpus of ₹5 crore in 10-12 years. My risk profile is moderately aggressive.[EasyDNNnews:PaidContentStart] Please suggest mutual funds to invest in.- Manoj Yadhav


Assuming an annual return of 12 per cent on your investments, you need to invest around ₹1.55 lakhs every month to create a corpus of ₹5 crore in 12 years. If you can afford to invest such a sum every month, you can start investing in mutual funds that are in line with your risk profile. Moderately aggressive is a bit vague. We typically ask moderate investors to invest in flexi-cap funds. If you want to take aggressive bets, you can invest in Mid-Cap, Small-Cap, thematic schemes, etc. However, make sure you are investing as per your allocation plan. You should always maintain your asset allocation by periodically reviewing your mutual fund portfolio. As your risk profile is moderately aggressive, you could consider investing in a mix of equity and debt mutual funds. Here are a few suggestions for mutual funds to consider:

Equity Funds 

•  HDFC Equity Fund

•  ICICI Prudential Blue Chip Fund

•  SBI Blue Chip Fund.

Debt Funds

•  HDFC Corporate Bond Fund

•  Aditya Birla Sun Life Corporate Bond Fund

•  Franklin India Dynamic Accrual Fund.

It is important to note that mutual fund investments are subject to market risks. Please consult a financial advisor to determine the right mix of funds for your specific financial goals and risk tolerance. Additionally, it is advisable to regularly review and rebalance your portfolio to ensure it aligns with your goals and risk profile. 
 

The market outlook is depressing. Does it make sense to invest in ELSS this financial year? - Roshan Amin 
 

The time to reduce your taxes has just begun. Many investors in mutual funds who purchase equity linked savings schemes, also known as ELSS mutual funds, in order to reduce their taxable income under Section 80C ponder whether the risk is worthwhile. Many investors are closely examining this tax-saving option due to the uncertain market outlook and the gloomy economic outlook. Under Section 80C of the Income Tax Act, investments in ELSS mutual funds are eligible for tax deductions of up to `1.5 lakhs. Many people wait until the last three months of the financial year, from January to March, to complete their tax-saving investments. 

Mutual fund advisers claim that this year, investors are not overly excited about making ELSS investments. It might be a mistake, though, to base your investing choices on the current state of the economy and market emotions. Investors must keep in mind that equity mutual fund schemes, including ELSS funds, are being bet on because they have the potential to deliver superior returns over an extended period of time. It is expected that they could perform poorly in the interim or turn extremely volatile. Mutual fund advisors contend that if investors keep their goals in mind, choosing their tax-saving investments will be simple. Many investors, though, neglect to connect their tax-saving investments to a goal. 

Taxpayers should be aware that decisions about investments that reduce their tax liability are not made in a vacuum. Investments ought to be covered in your comprehensive financial plan. To claim tax deductions, for instance, you should only invest in tax-saving mutual funds if you won’t need the money for an extended period of time. Yes, the required lock-in period is only three years, but it would be erroneous to believe that you could sell your investments for a tidy profit and exit at the end of the lock-in period. What if you need the money right away to achieve a goal? 

Stick to a five-year bank deposit to save on taxes. After ELSS under Section 80C, this is the tax-saving product with the shortest lock-in period. Similar to this, even if you have a long-term goal, you should always stick to safer options like PPF if you can’t take the added risk. 

Finally, as you can see, ELSS can assist you in funding your long-term financial objectives as well as in tax savings. Do not decide how much to invest this fiscal year based on the single-digit returns they have provided over the previous five years. In a similar vein, avoid letting the poor economic climate affect your choice. Equity investments would typically provide double-digit returns for long-term financial goals.

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