Corpus building for retirement

POSTED BY RSG ON August 7, 2012 6:58 pm COMMENTS (3)

Hello,

I need some advice for my current financial and retirement planning. Below are my current investment –

Background – I am 31 years old alone earner (1.1L/pm) in my house. I have my wife, 1 kid and father in my family.

Term Insurance of 50L + accidental 50L extra = 12K/pa. I’m planning to buy another 50L for myself.

Medical Insurance for my family = 7K/pa

HDFC Life Sampooran Smridhi = 50K/pa for 5 years.

PPF – 1L/pa

2 Home Loans – EMI of 13K each = 26K/pm

Gold MF – 2K/pm

Post Office MIS – 3L

Had few FDs and RDs but they got matured or are getting matured in next 2 months.

I want to have around 3 crore in 20 years as my corpus for my retirement. As per my research, below are the funds I selected –

Hdfc Equity
IDFC Premier Equity fund
Dsp Black Rock Top 100

Can you please if they are good funds and will help me achiveing my target. I’m planning to invest 10K per month. I guess it’ll be not be sufficient to achive 3 crore target, can you advice how can i modify my existing investments and plan towards my target?

Thank you,
RSG

3 replies on this article “Corpus building for retirement”

  1. RSG says:

    Thanks Ramesh for your reply!

    If not PPF, which deft fund should i go for? Any suggessions please?

    I am going for 70:30 equity:debt ratio for now.

    Thank you,
    RSG

    1. Ramesh says:

      Based upon your ease to get new funds.

      In the same AMC which you have currently, IDFC SSI Medium-term plan A is a reasonable plan.

      If you can select any of the debt funds, then
      either Birla sunlife Dynamic Bond fund or Franklin Templeton Income Opportunities fund are good.

      And anything in growth option only, not dividend.

  2. Ramesh says:

    Your funds are good.

    But I find it very strange that you have so many instruments for tax saving. You need to think and see which are better options for you.

    I am against PPF, since you do not need that illiquid option, when you are already fulfilling your 80C requirement. In my opinion, minimize it and use more liquid and tax efficient debt MFs as the debt component of your portfolio.

    I do not know the role of HDFC Life policy and what that is doing for you.

    You also need to analyse the overall equity:debt ratio of your portfolio for your long term goals. Fixing an amount usually does not help much, because of the uncertain nature of future, so use that only as an approximate guide.

    Also, you can start slowly and with some years down the line, you can really get going into investments.

    Keep things simple. Then they are easier and clearer to analyse and modify.

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