I am 50 years old. where should i invest my funds 2 crore to get 1.5 lakh per month (9% per annum) regularly for 30 years, with the corpus intact after the said period?
– Name withheld on request
It would be very difficult to get 9% annualized return over a 30 year period without taking some risk. No credible fixed income instrument or portfolio of debt funds can deliver such returns today, and sustain it for 30 years.
A different approach would be to consider the ‘Bucket Approach’ – where you keep some amount in low-risk funds (like 4 year withdrawals) and invest the rest in high-risk funds. You can make systematic withdrawals from the low-risk bucket, while the high-risk bucket will grow at a rate of over 9%. As soon as the first bucket is exhausted, you can move money into it from the higher risk bucket as per the need and continue with it. While this will not guarantee you a 9% withdrawal capacity, it will increase the chances and grow your corpus.
I am 30 years old and have moderate risk appetite. i am investing 18,000 more to be added to equity funds under Systematic Investment Plan (SIP) 4,000 more. how can i make 5 crore fund in 20 years.
– Name withheld on request
The primary keys to reaching a financial goal in a given time frame are the amount you invest and the type of assets you want to invest. The funds you choose are really important, but less so as long as you choose reasonably good funds. to receive 5 crore fund in 20 years, you have to invest from 55,000 60,000 per month (annual portfolio return of 11-12%). Currently, you are investing 18,000 per month (and may go 22,000). this will reach you 2 crore during this period. So you need to increase your SIP.
All your funds are good enough though SBI Small-cap would be a good option. Parag Parikh Fund subscriptions are reopening, and you should be able to invest.
Shrikant Meenakshi is the co-founder of PrimeInvestor.in.
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