Taking the words of India’s own investment guru, Rakesh Jhunjhunwala, to heart, “Investing is all about patience. Great investments take time to mature.”
And you, my friend, have chosen to embark on this journey with a clear goal in mind – retiring at 45. That’s a span of 11 years from now, and your target is a corpus of 7 crores. Let’s look at the ‘how’ and ‘where’ of your investment journey.
Firstly, we need to realize that such wealth creation, over a relatively short time frame, is primarily possible by leveraging the potential of equities. The Roots and Wings investment philosophy guides us in the process.
The “Roots” stand for companies with strong fundamentals – low debt, high return on equity, and top-notch management. The “Wings” represent businesses that demonstrate consistent growth in revenue and profits and are leaders in their markets.
You can consider investing a significant part of your lump sum in equity mutual funds, Index funds, or ETFs. Diversification of your portfolio across sectors and themes will help in spreading risk. It is important, however, not to lose sight of asset allocation – rebalancing your portfolio at regular intervals or based on market conditions can be beneficial.
Also, note that investment in equities requires patience, resilience to ride out the volatile phases, and an appetite for risk. The market may not always go up in a straight line, but remember that the journey to 7 crores would involve some ups and downs.
The other part of your portfolio can be dedicated to fixed income securities like debt funds, which provide stability. They may not offer high returns like equities, but they play a critical role in risk management, especially as you near your retirement age of 45.
Achieving such ambitious goals requires not just the right investment strategy, but also the guidance of an experienced advisor. Consider Jama Wealth for expert investment advisory and tailored Portfolio Management Services (PMS). It is, after all, a marathon and not a sprint.
