On the right track

Publication details: Money Manager – CNBC Bajar – 01-06-2016

Responses, opinion and view from Kartik Jhaveri.

Question sent by Chirag Patel :-

I had started an SIP of Rs. 1,000 each in 5 mutual fund schemes for a period of 20 years. The break up is as follows: 1 mid cap, 2 small cap and 2 sectoral schemes.

I want to accumulate Rs. 60 lakhs after 20 years. So is my investment enough or do I need to increase it gradually?

Advice given:

1. If you continue your total SIP of Rs. 5,000 for the next 20 years, you can amass approximately Rs. 65 lakhs. This is assuming a growth rate of 14% p.a.
2. Hence you can comfortably reach your target of Rs. 60 lakhs after 20 years.
3. You can consider restructuring your current SIPs in the following manner:
   1. Diversified – 40% (i.e. Rs. 2,000)
   2. Mid & smallcap – 40% (i.e. Rs. 2,000)
   3. Sectoral – 20% (i.e. Rs. 1,000)
4. Also avoid excess diversification.