1. Your choice of funds should always be simple and need/goal-specific, belonging to different AMCs, and from the top 5 funds with high 5/10-year returns, so that there is least need to churn while investing in them through SIPs during your 25+ investing years.
2. Select just one Hybrid Aggressive fund, for building your Retirement Corpus (aiming it as 25 times of estimated annual retirement expenses), due to its inbuilt auto-balancing equity-debt mechanism.
3. Select just one Multicap fund for
achieving your Long-term goals (of 15+ years), due to its ability to weather long-term market cycles.
4. Select just one Midcap fund for fulfilling your Medium-term goals (of 10+years), due to its advantage of encashing any windfall gains in India's vibrant economy.
5. Select just one ELSS fund (with Largecap bias) for availing Sec 80C tax benefits fully, by investing in it annually (SIPs with year-end top-up if needed) during all taxable earning years (minus EPF and Term Plan, no need to open a PPF account).
6. Maintain an Emergency fund of 6 months current expenses in just one Liquid/ Ultra-short-term Debt fund ( Bank flexi-deposit is ok too) for any contingency needs.
7. Stop all current SIPs which do not fall in the above categories, and start new SIPs / continue SIPs only in the qualifying funds in their Direct Growth option.
8. Systematically redeem all your stopped funds, in a tax-efficient manner, as per LTCG tax rules and grandfather clause, in an year or two, for reutilizing them in your remaining SIPs only.
9. Review your reconstructed set of 5 funds periodically, rebalance "runaway leaders" suitably, replace "stubborn laggards" unemotionally, but without increasing the category and number of funds, neither on your own nor upon anyone's advice.
10. The primary investment objective of any regular young earner (also any breadwinner) should be to build a fund portfolio that is inflation-beating, clutter-free, and multiplies his regular savings by power of compounding.
11. It should allow him free time and mindspace to focus on his own career / chosen vocation for his own advancement, thereby automatically increasing his investment potential further, during his earning years, for a richer and comfortable retired life.
12. Halve your number of funds while retiring, retaining only the Balanced and Multicap funds, by shifting others into them gradually, and then annually withdraw 4-5% of the accumulated corpus for meeting your retirement expenses for your entire retired life.
13. While aggressive investors may seek midcaps, smallcaps and sectoral funds in their portfolios for their alpha returns, multi-cap funds are an equally excellent investment option with lesser risk.
14. A multi-cap fund is able to cushion itself better, by realigning its portfolio rapidly from a much larger population of stocks, during changing market moods, and bear redemption pressure too, as it is likely to be more liquid.
15. Needless to mention that SIP allocations should be done after finalizing the specific amount of each goal.
2. Select just one Hybrid Aggressive fund, for building your Retirement Corpus (aiming it as 25 times of estimated annual retirement expenses), due to its inbuilt auto-balancing equity-debt mechanism.
3. Select just one Multicap fund for
achieving your Long-term goals (of 15+ years), due to its ability to weather long-term market cycles.
4. Select just one Midcap fund for fulfilling your Medium-term goals (of 10+years), due to its advantage of encashing any windfall gains in India's vibrant economy.
5. Select just one ELSS fund (with Largecap bias) for availing Sec 80C tax benefits fully, by investing in it annually (SIPs with year-end top-up if needed) during all taxable earning years (minus EPF and Term Plan, no need to open a PPF account).
6. Maintain an Emergency fund of 6 months current expenses in just one Liquid/ Ultra-short-term Debt fund ( Bank flexi-deposit is ok too) for any contingency needs.
7. Stop all current SIPs which do not fall in the above categories, and start new SIPs / continue SIPs only in the qualifying funds in their Direct Growth option.
8. Systematically redeem all your stopped funds, in a tax-efficient manner, as per LTCG tax rules and grandfather clause, in an year or two, for reutilizing them in your remaining SIPs only.
9. Review your reconstructed set of 5 funds periodically, rebalance "runaway leaders" suitably, replace "stubborn laggards" unemotionally, but without increasing the category and number of funds, neither on your own nor upon anyone's advice.
10. The primary investment objective of any regular young earner (also any breadwinner) should be to build a fund portfolio that is inflation-beating, clutter-free, and multiplies his regular savings by power of compounding.
11. It should allow him free time and mindspace to focus on his own career / chosen vocation for his own advancement, thereby automatically increasing his investment potential further, during his earning years, for a richer and comfortable retired life.
12. Halve your number of funds while retiring, retaining only the Balanced and Multicap funds, by shifting others into them gradually, and then annually withdraw 4-5% of the accumulated corpus for meeting your retirement expenses for your entire retired life.
13. While aggressive investors may seek midcaps, smallcaps and sectoral funds in their portfolios for their alpha returns, multi-cap funds are an equally excellent investment option with lesser risk.
14. A multi-cap fund is able to cushion itself better, by realigning its portfolio rapidly from a much larger population of stocks, during changing market moods, and bear redemption pressure too, as it is likely to be more liquid.
15. Needless to mention that SIP allocations should be done after finalizing the specific amount of each goal.