I am 43 and work for a central public sector undertaking. I have been investing ₹1 lakh in PPF for the last eight years towards the higher education of my elder daughter studying in class one. I have also been investing ₹5,000 every month through the SIP route in UTI Opportunities for the last six months. I wish to invest ₹5,000-10,000 a month in mutual funds for 15 years to fund the education of my younger daughter, now three. Please suggest some good funds so I can accumulate ₹50 lakh after 15 years.

- Ravi K Dhiman

Saving for both your daughters’ education fairly early makes accumulating the intended sum much easier. With your PPF investments, you have made considerable headway in funding your elder daughter’s education. Continue investing in this instrument for the next 7-10 years.

In your mutual fund investments, if you park ₹10,000 (including the ₹5,000 currently being invested) every month for the next 15 years and the returns are 12 per cent annually, you can reach the goal of ₹50 lakh comfortably. These return expectations are reasonable. A portfolio of large-cap funds with some mid-caps would ensure that you reach your target.

Now, split ₹10,000 as follows: Invest ₹4,000 in ICICI Pru Top 100. Park ₹3000 each in Franklin India Flexi Cap and UTI Opportunities. Your portfolio would comprise large-cap funds and a multi-cap scheme. A relatively low to medium risk portfolio is being suggested as education is a non-negotiable goal.

Invest any further surplus in a recurring deposit to coincide with the beginning of your daughter’s higher education to bridge any deficit. Review your portfolio once every year and weed out prolonged underperformers. You can also invest in gold ETFs and add real estate for building a balanced portfolio.If you reach your target ahead of time, book profits or exit units and move the proceeds to safe debt avenues.

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