I am 28-year-old salaried professional, married and don't have any kids yet. I have a monthly income of ₹37,000 and spend ₹12000-15000 on household/shopping/fuel etc. I save around ₹22,000 every month. I have invested in
- Public Provident Fund: ₹50,000
- UTI Dividend Yield Fund: monthly SIP of ₹2,000
- HDFC equity fund (G): ₹5,000 per month
- HDFC Tax saver (G): ₹50,000 lumpsum
- UTI ULIP 10 Years plan: ₹1 lakh
- Stocks: ₹38160 (SBI, TATA steel)
- LIC Jeevan Tarang: ₹35,000 yearly premium
I want to build a corpus for my retirement, child's education and marriage. Also, I have plans to buy a flat and a budget family car. Please review my portfolio and advice on current investment plan or another plans to achieve my financial goals in the future.
- Pranav Yajurvedi
Since you have identified your financial goals, you should start investing a fixed amount every month to achieve them. For long-term goals that are at least five years away, invest in one or two top-rated diversified equity schemes. For short-term goals that are just a few months or years away, opt for bank deposits, debt mutual funds, etc. For tax saving purpose, go with a tax saving mutual fund scheme.
However, you have to do a few things along with or before that. First, build a contingency fund that would take care of your six month's living expense. This is to ensure that a medical emergency or a career trouble would not upset your financial plans. Next, get a health cover for you and your family. Also, buy a term insurance plan to secure an adequate life insurance cover. Term plans help you to buy a very large insurance cover by paying a small premium. (The LIC plan you have is a whole life plan. It is an opaque and costly product).
Your subject line is "which is the best combination: Mfs with stocks or Mfs with ULIPs?". We typically recommend mutual funds to regular individuals who don't know much about the market or/and don't have the time to track the market and take investment decisions. Invest in stocks only if you know enough about the stock market and companies. Avoid investing on tips.
Unit Linked Insurance Plans (ULIPs) are a big no. These plans do not offer adequate insurance cover. They are also not a great investment choice. Always keep your insurance and investment needs separate. Buy a term insurance plan to get an adequate life insurance cover and invest in equity mutual funds to achieve your long-term financial goals.
By the way, UTI ULIP is not a Unit Linked Insurance Plan (ULIP). It is a hybrid mutual fund scheme that invests in a mix of equity (maximum 40 per cent) and debt. It also offers life insurance cover and accident cover. However, this life insurance cover can't be a substitute for a stand alone life insurance cover.
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