When it comes to money, you want to hear it from the experts. So, this week we bring you excerpts from our interview with Sandip Sabharwal , one of the longstanding equity managers in the country. After his stints in SBI Mutual and JM Mutual, he now manages PMS for Prabhudas Lilladher. While one would naturally assume him to be an ?equity' man, he surprised us when he said that he's invested a large chunk of his portfolio in debt! Read on to know how he manages his personal money.

What does money mean to you?

Money is essentially a route to achieve one's aims in life. When I started working, I wanted to achieve a particular amount of savings. But now, at this stage of my career after working for over 15 years, money is not the prime driver and it is what I can achieve in terms of performing well and delivering strong and sustainable performance for my investors.

What are your top financial goals?

Through a combination of savings and investments, I want to have a sum that is at least 20 times my annual expenditure at any point of time. This has to be after having a home that is fully paid for and net of any liabilities, which would include housing, car loan and such.

How much of your wealth is invested in bank deposits, stock markets, real estate and gold?

As per current market value and including the investments of my family, the portfolio is like this - bank fixed deposits: 10 per cent, stock markets: 20 per cent, real estate: 60 per cent, gold: 10 per cent. This is however not a combination that I would recommend to investors. The logic for a person, with all his income related to the stock markets (such as me), investing in other asset classes is to lower the swings in the value of investments.

Tell us about your most successful investment - the one which made the most money for you?

One big multi-bagger for me was Thermax Industries that was bought in the year 2004. I bought into this company when the stock was at a price of around Rs 100-120 a share and kept on adding it. Ultimately, even after the big correction in the markets in 2008, this stock trades at 25 times the price of 2003-04, which implies a return of 2,500 per cent. On the personal front, I have made much more money by investing in real estate and that has been as per my financial plan.

One mistake in investing or saving that you regret?

Contrary to the investment plan that I had made for myself ? as per which I had decided to invest most of the money in a field unrelated to my job of a fund manager - I invested a large part of the money kept in fixed income investments in stocks in 2008.

Most of this money was invested into mutual fund schemes that I was managing at that time. Subsequently, when I moved on, I withdrew that money at the bottom of the markets in March 2009 and did not redeploy the money into equities. This was a typical case of buy high and sell low, which I myself advise investors to avoid.

How do you plan your investments to beat inflation?

The only way to do this is to invest in either equities or real estate. I believe that land will always be in shortage in India given the demographic profile. As such, investments in land in tier 2 or tier 3 cities is one of the best investments along with equities, which have averaged a return of 18 per cent over the last two decades and should yield 18-20 per cent over the next two decades also.

What is your message on saving and investing to young people just starting out on their career?

I think that young people who are starting out are the most casual as far as their savings go. I was no different. If I had started off putting some money aside in the form of SIPs into equity mutual funds at the start of my career it would have grown to a substantial amount by now! Young people spend most of what they earn or do not deploy the money in the right asset class.

As one starts working, a majority of money should be invested in one form or the other into the stock markets.?

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