As investors move closer to retirement, aligning their mutual fund portfolio with long-term goals becomes crucial. So, if you are approaching your retirement and plan to create a corpus of Rs 1 crore in a span of approximately 10 years, an expert shares how fine-tuning your current SIP strategy can help you achieve above this corpus in the same time frame.
That’s exactly what Atamjit Singh, a 49-year-old investor and viewer of The Money Show on ET Now, wants to accumulate in the next 10 years.
His current portfolio value stands at Rs 12 lakh, and he’s investing Rs 10,000 each month in four mutual funds, namely Kotak Large and Midcap, HDFC Midcap, Parag Parikh Flexicap, and DSP Smallcap, totalling Rs 40,000 in monthly SIPs.
Expert analysisFinancial expert Samir Shah, Founder of Investa Financial, analysed Atamjit’s portfolio and goals, noting that with a 12% annualised return, the existing SIPs and corpus could grow to around Rs 1.32 crore over 10 years, comfortably meeting the Rs 1 crore target.
However, he advised refining the plan to account for inflation and taxation, which can erode real returns over time.
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To strengthen the strategy, Shah recommended increasing the SIP by 10% every year. This “step-up SIP” could potentially help Atamjit accumulate around Rs 1.75 crore over 10 years, providing a cushion against inflation.On portfolio alignment, Shah pointed out that Atamjit’s investments are well diversified across all four categories but suggested a gradual shift from small- and mid-cap funds towards a dedicated large-cap fund, considering his age and goal. This adjustment would lend greater stability and reduce volatility as he nears retirement years.By making these small but strategic tweaks, Atamjit can confidently stay on track to achieve and possibly exceed his Rs 1 crore target goal over the next decade.
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