Please review my portfolio (I have given detail information)

POSTED BY Paresh ON January 16, 2013 6:56 pm COMMENTS (19)

Hi

I am 32 years old Software Engineer and big fan of jagoinvestor. I live in Indore with my wife, one daughter and parents.

Please review my portfolio and let me know if any change is required:

My monthly investments:

1. Rs. 5,500 in DSP Black Rock Top 100 Equity (G) (Current Units 1944)

2. Rs. 5,500 in IDFC Premier Equity Plan A (G) (Current Units 4275)

3. Rs. 5,500 in Reliance Regular Saving Equity (G) (Current Units 7100)

4. Rs. 5,500 in HDFC Top 200 (G) (Current Units 910)

5. Rs. 12,500 in Employee Provident Fund (Including my contribution and employer contribution) (Current value Rs. 5,50,000)

6. Rs. 3,500 in Public Provident Fund (Current value Rs. 1,20,000)

7. Rs. 2,000 in Swarna Nidhi Scheme by Tanishq (Tata) (Current value Rs. 30,000)

My plan is to increase SIP amount yearly by 8% (depending on my salary raise). I will continue my SIPs till my retirement (age 58). EPF will automatically increase with salary raise.

Insurance:

1. ICICI Pru iProtect Term Insurance of Rs. 50,00,000 (Premium Rs 6,786 yearly)

2. Kotak e-Prefer Term Insurance of Rs. 50,00,000 (Premium Rs. 6,786 yearly)

3. Metlife Term Insurance of Rs. 50,00,000 (Premium Rs. 6,900 yearly)

4. Tata AIG Accident Insurance (Accident Guard) of Rs. 36,00,000 (Premium Rs. 8,000 yearly) with weekly benifit

5. Tata AIG Accident Insurance (Income Guard) of Rs. 40,00,000 (Premium Rs. 4,5000 yearly)

6. Oriental Happy Family Floater Plan Healt Insurance of Rs. 5,00,000 (Premium Rs. 13,500 yearly) (My whole family including parents are covered)

7. Health policy given my Employer (parents are not covered) (Rs. 2,00,000)

Property:

1. Own House (Current value is Rs. 25,00,000)

2. Own Plot (Current value is Rs. 13,00,000) (Paying Rs. 6,500 EMI) (Once I will finish loan of Rs. 5,00,000 I will build Home on it to generate rental income)

3. Gold (Current value is around Rs. 5,00,000)

Emergency Fund:

1. FD in different Banks of Rs. 4,00,000

Goal:

1. Daughter higher education (year 2028) (Present cost is Rs. 20,00,000)

2. Daughter marriage (year 2036) (Present cost is Rs. 25,00,000)

3. Getting regular money (pension) to live current life style ( Present cost Rs. 25,000 monthly) (life expectancy 100 years)

I am planning to buy one policy for my Home (to cover earth quck, fire etc) and individual illness policy.

Please let me know if it is good portfolio. If not then what changes I should make.

Thanks

Paresh

19 replies on this article “Please review my portfolio (I have given detail information)”

  1. bharat shah says:

    a small addition to 3 above:

    3.you may think e gold over gold etf or gold fund units for buying small quantities (1-2-5-10gm, or so a month) , and physical gold /depositing in SBI Scheme) for bigger quantity.

  2. bharat shah says:

    @paresh
    nothing special to reply to your query , but like to bring to your notice two -three things about gold etf, which is already discussed in the discussion you quoted:

    1.by design, gold etf’s unit is not representing 1 gm or 0.5 gm gold( in case of quantum gold etf) as believed, but is getting reduced at rate @1%p.a. or a little less every year of previous year’s weight, irrespective of prevailing price of gold to meet the management expenses and profit margin by AMC( limited to 1% p.a. by law.). it translates into @20-22% weight loss in 25 yrs ,irrespective of prevailing price of gold then.
    2. gold price could increase, decrease , be stable on year to year basis.
    3. you may think e gold over gold etf or gold fund units.

  3. Dear Paresh, any idea which is comfortable to you, is good.

    Thanks

    Ashal

  4. Dear Paresh, you are free to adopt any %age as per your own comfort level. There is no thumb rule for that.

    Thanks

    Ashal

    1. Paresh says:

      Thanks, but will it be a good idea to reduce investment in PPF and start new SIP in HDFC Prudence. Please suggest.

  5. Paresh says:

    Hi All,

    As my age is 32 years and I am investing 55% in pure Equity, 45% in pure Debt and 5% in Gold. As per my age I should invest 32% in Debt/Gold and 68% in Equity. So I am planning to reduce PPF investing by Rs. 2500 and want to start new SIP of Rs. 2500 in HDFC Prudence fund (which is a Balanced fund). Also instead of Rs. 2000 investing in physical gold, I would like to start SIP in Reliance Gold SIP.

    Please suggest if I should go for this change.

    Thanks
    Paresh

  6. Kotak Support Team says:

    Dear Sir,

    We request you to confirm your contact no and email ID on clientservicedesk@kotak.com ID along with detailed mail for better assistance.

    Regards,
    Kotak Support Team

  7. Dear Paresh, if you are investing after 5th of any month, you ‘ll not get interest for that month. Interestingly if you are investing on mly basis, you are losing the interest had you invested in one lump sum between 1st to 5th april. Yes you are earning the interest for the remaining months in the year.

    Thanks

    Ashal

  8. Dear Paresh, that 1% charge thing ‘ll not impact your gold as suggested in the discussion. How? The Capital appreciation in the price of gold ‘ll take care of this 1% charge. For example if 15% is the growth rate after 50-70Y, your actual growth rate ‘ll be 14%.

    One interesting thing, if 1gm pure gold price is 3000 Rs. in market & GOLD ETF Unit price at the same time is quoting 2995 Rs. due to demand & supply mismatch, where w’d you purchase?

    You may check this thing on any given day.

    Also have you considered the T&Cs of Tanishq?

    Thanks

    Ashal

  9. Vikash says:

    Paresh, Most of your things are on track. Congratulation.

    Only thing that missing is Critical Illness policy. Take from MaxNewyork Lifeline Wellness Plan or ICICI Pru Crisis Cover. They cover almost all critical illness almost 30-37 (Highest in the industry).

    Rest are more or less fine.

    1. Paresh says:

      Yes I am planning to buy below more insurances:

      1. Critical illness for each member (except my daughter). Insurance amount Rs. 10,00,000 for each

      2. Super Top up plan from United India of Rs. 10,00,000 with Rs. 5,00,000 threshold value

      3. Home insurance from United India

  10. Dear Paresh, congratulations. You are on track almost. Some minor changes here or there may be enough for you.

    Gold – Please provide your reasons for opting Tanishq & not Gold ETFs.

    Realestate – Own house is ok. Please do tell me, if you do have money right now to construct, what ‘ll be the construction cost on that plot & what ‘ll be the possible rental income from that.

    Debt – Instead of investing on mly basis in PPF, please invest lump sum between 1st to 5th April; every year to get the full year’s interest benefit.

    Eq. – As of now I’m not commenting as I want to discuss other things first.

    Thanks

    Ashal

    1. Paresh says:

      Thanks for reply.

      Gold:

      I am not doing investment in Gold ETF after reading this question:

      http://localhost/jagoforum2/gold-etf-versus-physical-gold-expense-ratio-is-hurting/1919/

      Real state:

      I want to finish my plot loan then I will take new loan to build house. It would take Rs. 18,00,000. I can expect Rs. 10,000 rental income. I will also take the advantage of home loan to save income tax.

      Debt:

      I am investing Rs. 2,500 monthly. I cannot invest Rs. 30,000 lump sum between 1 to 5 April. Are you sure I am not getting return on money which is invested after 5th April?

  11. You have most things right. However you need to find out exactly how much to save for each of your goals.

    You can use this for your goal calculation:

    http://freefincal.wordpress.com/goal-planning/optimize-your-goal-investment-amount/

    You can also use the comprehensive child planner variable there to see if you are adequately insured.

    You can also fine tune your investments for retirement using the retirement planner there.

    You are implying all your SIPS are for your retirement. Even if this is the case you should not continue them until retirement. You must pull out of equity 2/3 years prior.

    I think you are saving adequately for retirement. You need to check for your other goals.

    Choose your asset allocation according to your risk profile.

    Once you determine the amt to invest and how much to invest in equity and how much in debt start your investments accordingly.

    I think you need debt components for goals other than retirement. You can choose some debt funds or start with balanced funds for the same

    1. Pratap Devathi says:

      As per your age, You can invest 30% in large cap, 30% flexi cap and 40% in mid & small cap. Out of total 22000 of you SIP investments, allocate 6000 for large cap 8000 for Flexi cap and 8000 for Mid & small cap. Please choose the funds as below…

      Large cap:

      3000 Icici pru focused blue chip
      3000 UTI opportunities fund

      Flexi cap:

      4000 Reliance equity opportunities
      2000 Quantum long term equity
      2000 canara robeco diversified equity

      Small and Mid cap:
      3000 SBI magnum emerging business
      3000 HDFC mid-cap opportunities
      2000 IDFC premier equity

      Regards
      PD

      1. Paresh says:

        Thanks for reply.

        In some of the finance websites and news channel I came to know that we should not invest in more than 4 equity funds. Otherwise it will be very difficult to track it.

        I am doing investment in all types of funds like

        DSP Black Rock Top 100 Equity is Large cap fund
        IDFC Premier Equity is Large cap and Small cap fund
        HDFC Top 200 is Large cap and Mid cap fund
        Reliance Regular Saving Equity is Multi cap (Large/Mid/Small) fund

        Please let me know if I am not correct.

        1. Yes you are right. You choice of funds is good.

    2. Paresh says:

      Thanks for reply. I am not doing investment only for my retirement. I am doing for my daughter eduction and marriage as well. My plan is to use PPF and EPF money only for retirement. Regarding MF investment I will start STP in secured funds like (MIP, Guilt Fund, FMP etc) whenever my goal will be 3 years near to avoid market moves.

      I am not doing investment in debt or balanced funds as I am already doing Rs. 16,000 investment in EPF and PPF which is secured.

      Please let me know if I am not correct.

      1. You are right about your MF statergy. However you say:

        My plan is to use PPF and EPF money only for retirement.

        This may not be enough. You need to use a retirement planner to check if you will be able to receive a pension which will be enough to beat inflation in your retirement years.

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