I have gone through many of your posts which talk about financial planning, investments & mutual funds. First I will lay down my current financial condition for your perusal
Age: 34 years
Kids Age: 9 months
12.5 L (in-hand)
Current Financial Outgo (except regular home expenses):
LIC – 3062 per month (maturing in 2024)
ICICI Pru Ins – 30,000 annually (looking to close it asap, its a wealth plus plan)
ICICI Pru Ins – 30,000 annually (maturing in 2020)
Term Ins – 936 per month
Other Insurance (medical, health, parents medical combined) – 3000 per month
I have also bought an under-construction property which totals to 80 L (all inclusive), loan payment will start after 5-6 months and will as per slab structure
Financial Goals: Short-Term, Medium-Term & Long-term
Short term (below 5 years):
Goal: Buy a Car, International Holiday | Investment Options: Short term Debt MFs, FDs & RD’s
Medium term (5 to 10 years):
Goal: Kids Primary Education | Investment Options: Balanced Equity Oriented Mutual Funds
Long term (more than 10 years):
Goal: Kids Higher Education | Investment Options: Equity MFs, PPF
Mentioned below are the options of equity MFs I am looking to invest (SIP) in
Birla Sunlife Frontline Equity Fund
ICICI Pru Focussed Bluechip Fund
Multi Cap/ Diversified:
Franklin India Prima Plus Fund
ICICI Pru Value Discovery Fund
HDFC Mid Cap opportunities Fund
Franklin India Prima Fund
ICICI Pru Balanced Fund
Mentioned below are the options of debt MFs I am looking to invest (SIP) in
Liquid Funds (1 to 3 months):
HDFC Liquid Fund
Ultra Short Term Funds (3 to 9 months):
Birla Sunlife Floating Rate Fund
Short Term Funds (6 to 18 months):
Birla Sunlife Short Term Fund
Please help me understand if this planning is on the right path or not and also on how many funds at max should I invest in and which? I am aware that the amount which I need to invest is something I have to decide on my own but it will really help me if you can take me down the correct path by correcting any wrong assumptions/decisions I have mentioned above.
Go ahead but try to retain one fund within one category. Also, for 5-10 years goals, I don’t think hybrid funds suitable. Instead do your own asset allocation like 40:60 in equity and debt. In Debt MF, stick to ultra short term or short term gilt funds. Use liquid funds for short duration (which you pointed rightly). Except for term life insurance, don’t continue the existing LIC and ICICI insurance plans.
Asset allocation, yearly monitor, and long-term investment are succsessing mantras.
Yes I will be going with one fund within each category.
I have close to 15L in surplus cash and want to invest a portion of it (30-40% in MFs and rest in Savings Account) for very short term (like 3-4 months), so in such a case is liquid funds more beneficial or ultra short term funds?
Planning to visit both LIC & ICICI to understand how much I will gain/lose if I decide to continue/discontinue. A part of my question you had answered earlier here https://www.basunivesh.com/forum/question/should-i-continue-lic-jeevan-saral-policy-or-surrender-it/ so will see what needs to be done