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How Much To Invest?

Invest an amount that is driven by your ability to save after accounting for essential expenses…

I am 27 and earn Rs 16,000 a month and live with my parents and have no investments so far. How much and in what funds should I invest in?
- Ankit

It is encouraging to note your enthusiasm to invest. The amount that you wish to invest should be driven by your ability to save or after accounting for your essential expenses the sum that you can comfortably set aside to invest regularly. Ideally you should start investing in a balanced fund such as HDFC Prudence or Reliance Regular Savings Balanced Fund, however, as you fall in the 10 per cent income tax category; it will not be a good idea for you to start investing in a tax planning fund. By investing in these funds you can claim tax deductions under Section 80C, however, these funds come in with a three-year lock-in which is tax free when redeemed after this period.

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