You should try to assess how much amount you would need for the post-retirement phase, which is mostly around 20 to 25 years.
I am 55 years old and planning to retire at 60. I invest ₹10,000 per month in each of the following mutual funds through SIP (Systematic Investment Plan). These funds are Aditya Birla Sun Life Frontline Equity Fund, HDFC Mid-Cap Opportunities Fund, ICICI Prudential Bluechip Fund, Kotak Flexi Cap Fund and SBI Bluechip Fund. So far, I have deposited ₹27 lakh in these funds. I want to create a corpus of ₹1 crore by the time I retire. Are my SIPs sufficient or do I need to invest more in MFs?
Name withheld on request
Considering 10% annual return on your current MF portfolio and future SIPs of ₹50,000 across five funds, you would be able to create a corpus of around ₹81.75 lakh. If we assume an annual return of 12%, the corpus would be approximately ₹87.75 lakh. This will be slightly less than your target. To reach the target of ₹1 crore in 60 years, you would need to invest ₹74,000 per month if we assume 10% annual return and ₹65,000 per month at a growth rate of 12%. Hence, you may have to start investing a higher amount to achieve the goal.
Also, you should try to assess how much you will need for the post-retirement phase. This stage is mostly of 20 to 25 years. We are sure that you must have assigned your mutual fund portfolio as well as other assets for your post-retirement needs. You may need more than ₹1 crore for your post-retirement stage.
The last thing you want is to outlive the deposit or compromise on your retirement. From fund point of view, you are investing in reasonably good funds and some of these funds may not be among the best but you can continue with them currently and review them after one to two quarters can do. If you are planning to add more SIPs to reach your goal, you can consider Canara Robeco Emerging Equities Fund or Kotak Equity Opportunities Fund.
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