Will these mutual funds help me to create Rs 1 crore for my son’s education?

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I am 45 years old. I am investing Rs 12,000 per month in mutual funds through SIP:

Mirae Asset Emerging Bluechip Fund: Rs 2,000
Kotak Standard Multicap Fund: Rs 2,000
Kotak Emerging Equity Fund: Rs 4,000
SBI Bluechip Fund: Rs 2,000
SBI Small Cap Fund: Rs 2,000

I want to increase my SIP investments from Rs 12,000 to Rs 25,000. I will continue my investments for the next 10 years. I need Rs 1 crore for my son's study. My risk profile is medium. Please help.
-Naveen Kumar Singh


We typically ask long-term investors with moderate risk profile to invest in multi cap schemes. If they want to diversify and reduce the overall risk, we ask them to invest a part of their money in large cap funds.

  • 5.33%Annualized Return for 3 year
  • >3 years Suggested Investment Horizon
  • 2.8 YearsTime taken to double money
  • 5.91%Annualized Return for 3 year
  • >3 years Suggested Investment Horizon
  • 3.9 YearsTime taken to double money
You are currently investing in a large & mid cap scheme, multi cap scheme, mid cap scheme, large cap scheme, and small cap scheme. You have too many schemes in your portfolio, and most of them do not match your risk profile. Large & mid cap schemes, mid cap schemes, small cap schemes are not suitable for moderate risk-takers. They are highly risky and volatile. That is why these schemes are recommended only to aggressive investors with a very high risk appetite and ability to tolerate volatility.


You need to invest in one or two good multi cap schemes like Kotak Standard Multicap Fund to take care of your long-term goals. For more such schemes, see: Best multi cap mutual funds to invest in 2020

Note, multi cap schemes are facing a crisis of sorts after the recent changes made by Sebi. As per new norms, multi cap schemes must invest at least 25% of their corpus in each large cap, mid cap, and small cap stocks. An investment mandate of 50% in mid and small cap stocks would make these schemes highly risky, not suitable for moderate investors. These schemes are likely to undergo some changes in the next few months, as mutual funds have time until January to comply to the new rules.

Assuming an annual return of 12% on your investments, you would be able to create a corpus of Rs 27.88 lakh if you invest Rs 12,000 for the next 10 years. If you invest Rs 25,000, you would be able to create around Rs 58 lakh at the end of 10 years. We have not included your current investments in the calculations as you have not shared details of them.
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Do not choose random numbers like Rs 1 crore for your long-term financial numbers. Due to the impact of inflation, you would find that the corpus will not be enough to take care of the goal. For more, read: Why Rs 1 core will not ensure happy retired life

Always find out the current cost of the goal and provide for annual inflation to reach a realistic target. Once you know your target, you can find out how much you need to invest every month to achieve it.

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