Who doesn't want to retire as a crorepati! Often we see people planning to accumulate Rs 1 crore by their retirement. However, what they fail to notice is Rs 1 crore now wouldn't amount to same after 10-20 years due to inflation. That said, investors must take into account the inflation factor before zeroing in on a corpus that they need at their retirement. 

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Anand Waghmare, a viewer of Zee Business from Bidar made the same mistake. He is willing to start investing in mutual funds to collect Rs 1 crore after 20 years. While his approach to plan for the retirement via SIPs in mutual funds is great, but not the amount that he quoted. Before we come to what expert advised him, let's take a look at his portfolio: 

Waghmare earns Rs 50,000 per month. He has taken two LIC policies whose annual premium together comes in at Rs 30,000. He also invests Rs 50,000 each year in his PPF account. He is investing money in the following funds: 

Mirae Asset India Equity Fund
Kotak Select Focus Fund
ABSL Equity Fund
HDFC Midcap Opportunities Fund
Robeco Emerging Equities Fund
Franklin India Prima Fund 

According to mutual fund advisor Harsh Roongta, one of the major mistakes that Waghmare is making is he has taken up plenty of policies. "Instead of focusing on fund selection, better to pay attention on asset allocation," he advised.

With Rs 30,000 into LICs and Rs 50,000 into PPF each year, Waghmare's finances are excessively exposed in debt investment. "Not only his debt investments are poor-return generating, but he is under-insured on life insurance too," said Roongta. 

Although the expert suggested the investment value (Rs 13,000) needed each month to collect Rs 1 crore after 20 years, he warned that Rs 1 crore will not be enough.  

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"Going by Rs 1 crore, the investor can only receive Rs 10,000 as pension per month at today's value. This of course is well below what would be required at retirement factoring into inflation," said Roongta.  

Besides, Roongta advised Waghmare to cut down on the number of schemes he is investing in. "Among six schemes mentioned, he should pick just one or two, preferably Mirae Asset India Equity Fund, Kotak Select Focus Fund or ABSL Equity Fund, to achieve his financial goals," he said.