Can you earn a corpus of Rs 50 crore in 20 years via mutual funds?
Personal finance goals of individuals may vary over the short and long-term however analysts say its viability should be properly assessed.
Disclaimer: This story is for informational purposes only and should not be taken as investment advice.
When setting financial goals, investors should take into account short term and long-term goals. Short-term goals could be achieved in a span of two years, whereas long term goals may stretch beyond five years.
A new investor with a personal finance goal of Rs 50 crore in 20 years raised a query to ET Mutual Funds on Monday.
“I would like to know how much should I invest through SIPs and in which funds to create a corpus of around Rs 50 crore in a span of 20 years, with moderate risk,” the enquiry read.
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The expert who responded to the query called the goal ‘unrealistic’.
“Assuming an annual return of 12 per cent, you have to invest around Rs 5 lakh every month through SIPs for 20 years to create a corpus of Rs 50 crore. You might have set an unrealistic goal for yourself. You can try to quantify your various financial goals to get a realistic target corpus, and launch an investment plan to achieve it,” the response read.
While investing in mutual funds is often a sought out investment for its tax saving benefits, it may still attract some amount of tax. The different kinds of tax saving mutual funds can be open-ended, debt/income funds, liquid funds, equity growth and balanced funds.
Though investors will save a grave deal on taxes by investing in these funds, they may still have to pay taxes as applicable.
No tax is levied on long-term capital gains or for those equity mutual fund units that are being held for more than a year.
The ‘best mutual funds’ for the month of December were listed out in an earlier report by ET.
They were as follows:
- SBI Bluechip
- HDFC Balanced Fund
- Aditya Birla Sun Life Top 100
- SBI Magnum Multicap Fund
- Mirae Asset Emerging Bluechip Fund
- L&T India Value Fund
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