Investing Rs. 60 Lakhs involves several considerations, the most crucial of which is your risk profile. Your risk profile is determined by your risk tolerance (how much risk you can psychologically handle) and risk capacity (how much risk you can afford to take, given your financial goals, investment horizon, and financial situation).
If you have a high-risk tolerance and long-term investment horizon (more than 10 years), you can consider allocating a significant part of your portfolio to equities. Historically, equities have delivered higher returns than other asset classes over the long term, although they come with higher short-term volatility. Investing in diversified equity mutual funds or index funds can be a good way to get exposure to equities.
However, it’s important not to put all your eggs in one basket, and diversification across asset classes is key. You should also consider investing in fixed income instruments (like debt mutual funds, fixed deposits, and government securities), real estate, and gold, as these provide stability to your portfolio and can act as a hedge against equity market volatility. The allocation to these asset classes would depend on your risk profile and financial goals.
Assuming a balanced risk profile, you may follow a simple asset allocation strategy: 50% in equities, 30% in fixed income, 10% in gold, and 10% in real estate or other alternative investments. Adjust this based on your personal risk profile, financial goals, and investment horizon.
Let’s focus on the equity part, which is Rs. 30 Lakhs (50% of Rs. 60 Lakhs). If invested wisely and the market performs well, achieving an average annual return of 15% is quite realistic. In that case, after 20 years, your Rs. 30 Lakhs would grow to about Rs. 4.89 Crores. If you are aggressive and wish to go the whole hog into equities 100%, you are talking of attaining a corpus of nearly Rs 10 crores.
Investing is a long-term journey, and it’s crucial to review your portfolio regularly and rebalance it as per changing market conditions and personal circumstances. It’s also wise to take the help of a SEBI Regd investment advisor or a PMS firm to guide you through your investment journey.
