Chase early retirement with step up SIP; portfolio doctor advises not to ignore emergency fund
The Portfolio Doctor analyses investor Sarika Sachdeva's fund portfolio, identifying a need to streamline her investments for early retirement. The advice includes reducing the number of equity funds, balancing NPS exposure, and increasing SIPs an...
By ET CONTRIBUTORS | Updated:
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Aggressive investment has helped build a sizeable equity portfolio.
The Portfolio Doctor assesses the health of the fund portfolio, examines the schemes and their suitability with regard to the goals and, if required, recommends corrective measures. The advice given is based on the performance of the funds, the risk profile of the investor as well as his financial goals.
PORTFOLIO DOCTOR
Not many investors know whether they have invested in the right funds and if their fund portfolio is on track. The Portfolio Doctor assesses the health of the fund portfolio, examines the schemes and their suitability with regard to the goals and, if required, recommends corrective measures. The advice given is based on the performance of the funds, the risk profile of the investor as well as his financial goals.
Sarika Sachdeva is currently focussing only on two financial goals—building an emergency fund and saving for her early retirement. Here’s what the doctor has advised her.
PORTFOLIO CHECK-UP
Sachdeva is 43 and has been investing in equity funds for 7-8 years.
She has also invested in stocks, sovereign gold bonds and Post Office schemes.
Aggressive investment has helped build a sizeable equity portfolio.
Four global equity funds have helped in geographical diversification, while gold exposure has also helped to diversify.
Though they have performed well, there are too many funds. Only 10-12 across different categories are needed for diversification.
Get rid of some funds to streamline the portfolio and make it easy to monitor.
In the NPS, take a balanced exposure to equity and debt funds.
Sachdeva wants to retire at 53 with a monthly income of Rs.1 lakh.
This will be possible if SIPs are increased by 10% every year.
If she is unable to increase the SIPs by 10%, she should delay retirement by 2-3 years to build a bigger corpus.
INSURANCE
Sachdeva should buy health insurance to ensure medical expenses don’t upset retirement plans.
WRITE TO US FOR HELP
If you want your portfolio examined, write to etwealth@timesofindia.com with ‘Portfolio Doctor’ as the subject. Mention the following information:
Names of the funds you hold.
Current value of the investment.
If you have SIPs running in any of them.
The financial goals for which you invested.
How much you need for each financial goal.
How far away is each goal.
(Disclaimer: The opinions expressed in this column are that of the writer. The facts and opinions expressed here do not reflect the views of www.economictimes.com.)
