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I’m a third-year BTech student. I want to invest in MFs via SIPs in order to buy a house in the next 5-10 years. Please guide me.

—Shivalingam

While it is a good idea to start early with your investments, I’m not quite sure how you would manage to invest in SIPs as a student. If your plan is to start investing as soon as you start a job, that would be fine.

To realize a home-buying goal, you would need to build a corpus that is about 20-30% of the price of the house you are targeting to cover for down payment and expenses. For example, if the house you are seeking to buy costs 50 lakh, then you would need to have around 15 lakh in hand to proceed with the transaction. And to realize that amount in, say, seven years, assuming a nominal 10% portfolio returns from market-linked instruments, you would need to save and invest 12,000 per month.

Srikanth Meenakshi is foun-ding partner, PrimeInvestor.

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