I want to invest Rs. 7lacs to get Rs. 10lacs after three years. I want to prepay home loan after three years.I will need Rs. 10lacs for that. I am thinking about buying MF. Please suggest few good schemes and mix. Any other investment I should consider apart form MF? Current interest rate for home loan is 9.5%. After deducting interest tax benefit, effective interest rate is 7.75%. 7.75% is cheap interest rate and I don’t want to partial prepay my home loan now. Another reason is I will loose money on hand if I partial prepay it. If I buy MF, I will have some liquidity at least.
I got suggestion to invest in following MIP debt funds with low risk and approximately 10% return.
HDFC Monthly Income Fund ( LT )
Reliance Monthly Income Plan
I can take moderate/high risk, so suggestion was to use STP to few good balanced funds if I want better return (12%-15%). I am thinking of going STP way. Please suggest few good balanced fund.
Is above plan look OK?
Home and Home loan both are insured and I have kept aside enough money for emergency purpose.