Hi Mr. Basu,
First of all thank you very much for this amazing forum to host brilliant ideas and educate us.
Second, i needed your opinion and views regarding my portfolio.
Goals : a Combination of pure long term and short term investment.
- Will be starting 1 Year RD for PPF with 2000/- INR per month (48000 INR) to be paid before 5th April. (Each Year)
- 1 Year RD of 4000/- INR per month for equity stocks – to be invested after RD maturity.
- Long Term Recurring Deposit – 1000/- Per month (will try to use iWish RD – in case i need to increase amount)
- Health, Term and Accidental Insurance not more than 15000/- INR per year. RD will be used of 1250/- INR per month
- EPF by employer
- 6 Months of Salary in Liquid State.
- 3 year ELSS MF’s (4 Quantity) 1000/- INR Per month.Axis Long Term Equity Fund – Growth – ELSS
Birla Sun Life Tax Plan – Growth – ELSS
BNP Paribas Long Term Equity Fund – Growth – ELSS
Franklin India Taxshield – Growth – ELSS
- The payment dates of Insurance and MF will be near to each other so that i can use RD method for them.
- I do not see real estate investment as beneficial (as of now).
If you could suggest any problems or improvement in my current allocation please do let me know.
The biggest problem is you have defined your product investment time horizon. But sadly you don’t know your financial goals. First, define them, then product selection is not a big issue.
- To set financial goals, i need to find the current expense plus inflation rate and guess an expense after 20 years such as Child Education which might be too unrealistic. This will take time to generate a list of such goals and money required at that time.
- For Medical Emergency as a goal -: Using Insurance as a leverage
- For Child’s Education, i have a complete different portfolio for High school, Grad and Post grad(in case of MS).
- Also I try to keep enough liquidity within my portfolio for sudden bumps.
- Everyone in my family has Health Insurance with good background. so This was already taken into consideration.
- I have reached my Current goals such as my marriage, Education(Certification etc.) and 1 trip outside India per year.
- In your experience, what kind of goals do you suggest (Most common ones.)
- But without setting goals how can you start investing?
- Medical emergency always be compensated by health insurance and along with that some cash. Health Insurance alone will not suffice.
- Whether you started investment for those goals?
- When you create your basics right, then emergency to withdraw from investment hardly arise.
- Nothing can be expected when it comes to health and life.
- That’s Great 🙂
- It is hard to define your goals in my way.
I generally keep different portfolio for different purposes. So that they can act independently.
Such as -:
- Liability – TV, Mobile, Laptop, Computer, Kitchen (Fridge,Oven) etc.
- House – Renovation, Minor modifications etc.
- Personal (Pure Investment) -: Shared with you in my question
- Personal (Family) -: Intl. Trips, Child’s medicals, Child’s Education. (as of now I do not consider Investment from My Future wife)
- Retirement Goals (This is yet to be planned and i need to educate myself on that)
- Emergency Fund.
For the point No. 1,2,3,6 are on their ways.
I need some more help or education regarding Point 2 and 5.
Do you suggest any books or workshops where i can learn them myself before consulting to a CFA/CFP.
If you could also suggest good books or articles on Higher stock options such as F&O or to better understand Derivative Market that would be very nice.
Thank you very much and best of luck for the endeavor to help the people.