I am a retired PSU employee of the age of 66 years. I have Rs 15 lakh in PPF (extended for 5 years in 2020), Rs 8 lakh in shares, Rs 6 lakh in PPF. share 22 lakh in mutual funds and bank FDs. The marriage of my only daughter is about 12-15 months away for which I need Rs 22-23 lakh. How should I liquidate my investment?
Raj Khosla, Founder and Managing Director of MyMoneyMantra.com replied: You should start booking profits and start a Systematic Withdrawal Plan (SWP) from your investments in shares and equity mutual funds. keep this Pennies one in Savings account or bank fixed deposits of very short duration. This amount can be used for the marriage of your daughter. Liquidate other FDs as per maturity date or cash requirement. The amount deposited in the PPF account should not be touched. It is important to ensure the capital security of your savings and investments. Hence, continue investing in FDs and PPF for a secure monthly income and contingencies.
I get pension of Rs 44,000 per month. I have invested Rs.15 Lakh in SCSS, Rs.14 Lakh in Liquid Fund and Rs.23 Lakh in the following: loan Funds: ICICI Prudential Short Term Fund (Rs 4 Lakh), Aditya Birla Sun Life Corporate Bond (Rs 3.5 Lakh), HDFC Corporate Bond Fund (Rs 3.5 Lakh), HDFC Short Term Debt Fund (Rs 3 Lakh) Axis Short Term Debt Fund (Rs 3 lakh), Kotak Short Term Bond Fund (Rs 3 lakh) and Axis Banking Banking and PSU Fund (Rs 3 lakh). I have Rs 10 lakh in my savings account. I want to protect the fund. Am I on the right track?
Sanjeev Bajaj, Joint Chairman and MD-Bajaj Capital, replies: To select the best debt funds, it is necessary to consider some important parameters such as average maturity, modified tenor, credit quality, interest rate scenario, AUM, current yield, investment horizon and risk appetite. Your existing portfolio is spread across Banking & PSUs, Corporate Bonds, Liquids, Short Duration Funds and Small Savings Schemes. Liquid fund exposure can be switched equally between medium term and floating rate funds. Axis Strategic Bond Fund, Kotak Medium Term Fund and Nippon India Floating Rate Fund. Half of the total savings can be invested in ICICI Prudential Asset Allocator FOF and Kotak Balanced Advantage Fund. These Dynamic Asset Allocation Funds enjoy flexibility in terms of asset allocation between equity and debt instruments depending on the market conditions. This strategy strikes a balance between risk and return with less downside than equity investments and higher returns than debt investments. This way your entire portfolio will be diversified across asset classes, categories, schemes and AMCs. Review your portfolio once a year.