Active Stocks
Thu Mar 28 2024 15:59:33
  1. Tata Steel share price
  2. 155.90 2.00%
  1. ICICI Bank share price
  2. 1,095.75 1.08%
  1. HDFC Bank share price
  2. 1,448.20 0.52%
  1. ITC share price
  2. 428.55 0.13%
  1. Power Grid Corporation Of India share price
  2. 277.05 2.21%
Business News/ Money / Calculators/  Close to retirement, move money to fixed return instruments
BackBack

Close to retirement, move money to fixed return instruments

Take a balanced approach between equity and debt in your portfolio

Pradeep Gaur/MintPremium
Pradeep Gaur/Mint

I have just started working and earn around 10,000 a month. My expenses barely cross 3,000 a month. For a salary like this, what kind of equity funds should I invest in?

—Karthik

In the interest of keeping your investments going steady for a long time, it is important that you start investing only a sum of money that you can comfortably part with every month, even if it is a small amount. You can start a systematic investment plan (SIP) with as little as 500, and you can have a good multi-fund portfolio with investment of 2,000.

The nature of funds in your portfolio, however, does not depend on your income or the amount you plan to save. Those choices would depend more on the amount of risk you are willing to take and the time frame of your investment.

As a young person who has just started earning, one can reasonably assume that your risk level is unknown and that your time frame is long term. I would suggest that you start with a portfolio of two schemes. A large-cap scheme and a balanced fund. As you get comfortable with both the notion of monthly investing and the gyrations of the equity market over time, you can add on to this portfolio.

I am a non-resident Indian and have been investing in mutual funds since 2002. I have mostly invested through SIP and systematic transfer plan (STP) and have moved in and out of two large funds. The portfolio is worth 2 crore now. I have the capacity to put in 1 lakh every month for the next 6-7 years and then I would like to use this corpus for recreational purposes. I am 50 years old and should ideally retire at 65. However, I want to retire prematurely at 57 and enjoy life in India. My job is pensionable. I just need a house, say 2-3 crore, and some extra money to travel around India and the world. Am I on the right path?

—Rakesh Jain

With your existing corpus and the planned systematic investments over the next 6-7 years, you are well on course for an early retirement as per your plans.

However, given your age and the investment time horizon, you should take a balanced approach between equity and debt in your portfolio.

As you get closer to your date of retirement, you should move your investments to fixed return instruments such as non-resident external fixed deposits so as to safeguard them from market downturns.

Queries and views at mintmoney@livemint.com

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Published: 14 Feb 2014, 08:02 PM IST
Next Story footLogo
Recommended For You
Switch to the Mint app for fast and personalized news - Get App