I’m 25 year old earning 10 LPA, which translates to 70K per month. I’m interested in building a corpus of 5 Cr for buying a house in approximately 20 years. I’m doing a monthly SIP of 5K each in the following funds:
1. Reliance Small Cap fund.
2. L&T Mid Cap fund.
3. Mirae Asset Tax Saver fund.
I consider myself a risk taker, because I spend frugally, no family, no dependent parents, and I’ve accumulated emergency corpus of 10L.
1. I can pump in 30K more(in addition to 15K already invested), should I just put 15K in each of small and mid cap funds or should I take another mid cap fund and divide amongst the three. I’m not interested in investing more into ELSS because I’m already putting 1L into my PPF.
2. I’m planning to invest more aggressively into small and mid caps until 30, and then gradually I’ll redistribute my corpus into less riskier asset classes like Muti-caps, N50 / BSE30 index funds, hybrid funds etc. Please advice if my strategy is good enough or should I have a debt component from now on (other than PPF, EPF) ?
Thanking you in advance 🙂
Your aggressive nature vanishes once the market start to fall. Rather than doing that, first do the asset allocation between debt and equity. Then start investing. Refer my post “Top 10 Best SIP Mutual Funds to invest in India in 2019“, especially the first part of the article.
Hi Sir, thanks for your suggestion, I’ve started investing since last year, I’m yet to experience a market peak. The reason I’m thinking of dumping money into equity is mainly because, I dont need it now and hence I believe I can stomach the volatility. One more reason being given the current market conditions, I’ll get more units [per fund] at a cheaper price.
Am I thinking a bit recklessly ?
Whether you need it immediately or after 20 years, the first step of investment is asset allocation. Also, never look at PRICE of the NAV. It hardly matters for investors. This is where the investors turn into trap of low NAV or penny stocks. It is growth that matters but not the NAV. However, investing more with right asset allocation is the winning strategy.
Thanks a lot sir, points noted.