Mutual Funds

Your Fund Portfolio

K Venkatasubramanian | Updated on January 24, 2018


I want to invest ₹4,000 every month in mutual funds through SIP (systematic investment plan) mode over 10 years.

I am ready to take risks and want suggestions for good mutual fund schemes. Please suggest tax-saving schemes too.

Sayan With a long investment horizon and an ability to take risks, you can create a portfolio that could deliver well and help meet future goals.

You have asked for a tax-saving fund. While it is a good idea to save taxes, that must not be the primary concern while investing in mutual funds. Since you have a long-term horizon, invest in regular diversified equity funds. When you get any lumpsum, a portion can be invested in tax-saving schemes.

Coming to your SIP investments, split ₹4,000 as follows: invest ₹2,000 each in Franklin India Prima Plus and Canara Robeco Emerging Equities. The former is a predominantly large-cap fund though it invests in mid-caps as well, while the latter is a mid-cap scheme. Both have proven track records over the long term.

You can consider small lumpsums in Axis Long Term Equity or Franklin India Taxshield.

I retired recently after working for a bank and have invested a major portion of my retirement benefits in fixed deposits at 10 per cent interest.

I am looking for suitable equity mutual funds to park about ₹5 lakh for annual income and growth. I also want to invest ₹50,000 in a tax-saving scheme. Please advise.

M Vishnuvardhanrao

Depending on equity mutual funds for income is a risky strategy for retired people to follow since safety must be your top priority. Again, tax-saving funds are locked for three years. So, there could be a liquidity crunch if you park a large lumpsum in them.

However, you can invest in monthly income plans (MIPs) which invest a majority of their portfolio in debt instruments and a small portion in equities.

This may help you beat inflation. Try to get a monthly or a quarterly payout from your fixed deposits.

Half of this interest portion can be invested in Reliance MIP and Birla Sun Life MIP II – Wealth 25. These are proven monthly income plans and have been regular in dividend payouts.

Published on February 01, 2015

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