Highlights
- Invest Rs 30 lakh, withdraw Rs 10,000 monthly; expert suggests SWP strategy with a 4% withdrawal rate.
- ‘High-risk, subject to fluctuations’ – expert advises switching to small-cap or flexi cap funds.
- The discussion covered key topics, including creating the right investment plan and becoming a smart investor.
Rs 30 lakh investment for a retired father
A viewer asked for advice on a plan to invest Rs 30 lakh and withdraw Rs 10,000 every month for his retired father.
Vishwajeet Parashar said, “SWP is a very good strategy… it’s also called a systematic withdrawal plan.” He explained, “The Rs 10,000 he wants to withdraw… that’s approximately a 4% withdrawal rate.”
He suggested, “Two funds I would like to recommend are HDFC’s Balance Advantage Fund and ICICI Prudential’s Multi Asset Fund.”
Army personnel’s 20-year target
Mukesh Kumar Giri, who is in the army, wanted to learn about wealth creation by investing for 15–20 years.
Parashar said, “If you invest Rs 10,000 and a 10 per cent step-up… and we normally assume 12 per cent… then in 15 years you will have approximately Rs 78 lakh.”
He further said, “If you go for 20 years… then you will be able to create a corpus of approximately Rs 1 crore.”
On small-cap funds, he advised, “Small caps are a bit volatile in the market… preferably, you should consider Parag Parikh’s Flexi Cap Fund.”
Caution on Technology Funds
One of the viewers has a portfolio that includes a technology fund. Parashar commented on this, “This is a fairly high-risk fund, a sectoral fund, and it’s subject to fluctuations.”
He suggested switching from ICICI Prudential Technology Fund to a small-cap fund.
Regarding corpus estimates, he said, “An investment of Rs 15,000… for 10 years… at a CAGR of 12 per cent, would amount to approximately Rs 33.6 lakh. A 10 per cent step-up would translate to approximately Rs 50.6 lakh.”
Planning for Multiple Goals
Responding to a question from BSF personnel Shubhankar Sarkar, the anchor, Kavita Thapliyal, said, “Children’s education is a goal that cannot be delayed.”
Parashar said, “All goals are important… but try to link each SIP to a single goal.”
He added, “Be sure to factor in inflation, and the more steps you can take, the better.”
Advice to avoid return chasing
On the tendency to switch funds, Parashar said, “This is also called recency bias… Frequent changes won’t yield very good returns.”
He advised, “Don’t just look at returns. Consider your risk as well.”
(Disclaimer: The above article is meant for informational purposes only, and should not be considered as any investment advice. ET NOW DIGITAL suggests its readers/audience to consult their financial advisors before making any money related decisions.)
