Financial Planning Advice (Senior Citizen)

Dear Mohammed ji, I believe that there is no need to buy ULIPs now. Better not to mix insurance with investment. What is the reason for investing in mutual funds and then again redeeming them to fund ULIP premiums?? May I know if your advisor is associated with any product/service provider? Or is he/she independent professional? Is Rs 90 Lakhs corpus with Mutual funds? Regarding health insurance, you may have a look at Super Top - up health insurance plans. Kindly read : https://www.relakhs.com/top-up-health-insurance-plans-super-top-up-india/  

Dear Sir,
(Below is my response to your PVT reply..)
May I know which company's ULIPs are they recommending?
Redeeming mutual fund units to fund ULIP premiums can be a risky and un-wanted process.
Do note that they may get good amount of commission twice here, on sale of ULIPs and then on buying of mutual fund units. Do you buy mutual fund units through them?
You may opt not to answer my questions, if you think they are irrelevant..plz..

Dear Mr. Reddy, I missed answering one of your queries. Yes I buy the mutual funds through them. My relationship manager helps me in doing this. Regards Mohammed Abdul Bari

Good morning Sir, I see that there is a clear conflict of interest. Your banker is HSBC and they are offering 'Canara HSBC' life insurance products only. I believe that there are better products (if at all ULIPs are the choice) in the market.. They may not be receiving commission as they are bank staff, but definitely they will have targets to sell the products of their associated life insurance (Canara HSBC), which can be termed as 'conflict of interest'. You may ask them to provide a comparison between these ULIPs Vs with other popular ULIPs (like HDFC Life's Click2Invest etc.,). Glad to know that you are taking my questions in the right way. I do not have any bias against any banker/product provider. It is in the best interest of you...only..   

Dear Sir, My point is, instead of investing in funds and then re-investing the proceeds (MF redemptions) into ULIPs is not a sound investment strategy. Instead, you may straight away pick Liquid Funds and then set up STPs (Systematic Transfer Plans) to Equity oriented funds. Ex: HDFC Liquid fund to HDFC Prudence / HDFC Balanced fund. Though you are a Senior citizen and risk profile can be a moderate one, I believe that you are investing for wealth accumulation for long-term and would like to gift these to your family members. So, your age factor is not a primary factor to devise your investment strategy. You may invest the future FD proceeds too in mutual funds. You may nominate your family members for these investments. Also, suggest you to kindly write a WILL. Kindly read : https://www.relakhs.com/best-mutual-fund-schemes-2017/ https://www.relakhs.com/best-balanced-mutual-fund-schemes-review/ https://www.relakhs.com/list-of-best-investment-options-schemes-in-india/ https://www.relakhs.com/nominee-legal-heir-will-importance/ https://www.relakhs.com/nominee-legal-heir-will-importance/  

Dear Mr. Reddy Thank you so much sir, for your input. This is very much appreciated. I have made a decision now to follow your advice. My gut feeling is in sync with your advice. One more query please. I am contemplating investing on the side of my present corpus Rs. 15000/- (fifteen thousand) per months in SIP for my daughter who had given me Rs. 2,50,000 for investment. The duration will be about 5 years and goal is accumulation of wealth for her child’s education then. I will add the monthly payment after using up her initial investment. Could you kindly suggest an equity based product that I can use for this purpose please? I plan to do this online through Jago Investor’s web site unless you suggest otherwise. Your usual support in the matter will be much appreciated. Regards, Mohammed Abdul Bari

Good morning Sir, You may consider an equity oriented balanced fund for next 4 years or so. (I am assuming that risk taking is not an issue here...).  If the said platform offers Direct plans, then you may go ahead, should not be of an issue. Kindly read : https://www.relakhs.com/best-balanced-mutual-fund-schemes-review/ https://www.relakhs.com/direct-mutual-fund-plans-buy-online/ https://www.relakhs.com/mutual-fund-direct-plans-vs-regular-plans/  

Hi Sir, You mean to say that you have already set up six STPs? May I know the list of these six Equity funds. You wanted to short list 6 more equity funds from the above 13 funds for SIPs?  (investments for your grand children) Is my understanding correct?

Dear Mr. Reddy, Thanks for your quick response. Yes I have already set up six (6) STPs. Two (2) with HSBC & Four (4) with ICICI. These are for my three children & three granddaughters. They are as follows: I have moved Rs. 38 Lakhs to the following two liquid funds with HSBC: 1. Franklin India Ultra Short Bond Fund-Super Institutional-Growth: Rs. 18, 00000 2. Birla Sun Life Savings Fund-Regular Plan-Growth: Rs. 20, 00000 Total Corpus in Lakhs: Rs. 38, 00000 From the above two funds I have setup STP @ Rs. 25,000/- per week to the following two Mutual Funds: 1. Franklin India Prima Plus-Growth: Rs. 25,000 per Week 2. Birla Sun Life Frontline Equity Fund-Regular Plan-Growth: Rs. 25,000 per Week A sum of Rs. 50,000 per week in the above two funds. Corpus for Investment: Rs. 38, 00000 (38 Lakhs) Additionally, I have opened a new wealth management account with ICICI and deposited Rs. 25 Lakhs with them and invested in Liquid Fund in the following manner: 1. Kotak Low Duration Fund-Growth: Rs. 625,000/- 2. L@T Ultra Short Term Fund-Regular-Growth Rs. 625,000/- 3. Tata Ultra Short Term Fund-Regular Plan-Growth Rs. 625,000/- 4. Birla Sun Life Floating Rate Fund-Long Term-Regular Plan-Growth Rs. 625,000/- From the above 4 Liquid Funds I have set up four (4) STPs per week in the following Mutual Funds: 1. Kotak Select Focus Fund Growth Rs. 13,000/- Per week 2. L@T India Value Fund-Growth Rs. 13,000/- Per week 3. Tata Equity PE Fund Growth Rs. 13,000/- Per week 4. Birla Sun Life Small & Mid Cap Fund Growth Rs. 13,000/- Per week Total per month: Rs. 52,000/- Per Month Corpus for Investment: Rs. 25, 00000/- (25 lakhs) The STPs have been set at different dates in a month: In addition to the above, I have set up six (6) SIPs. These are for my six (6) grandsons. The SIPs are as follows: 1. Kotak Emerging Equity – Growth Rs. 10,000/ Month 2. Motilal Oswal Most Focused Multicap 35 Fund – Growth Rs. 10,000/ Month 3. HDFC Equity Fund – Growth Rs. 10,000/ Month 4. SBI Blue Chip Fund – Growth Rs. 10,000/ Month 5. L&T India Value Fund – Growth Rs. 10,000/ Month 6. Birla Sun Life Advantage Fund - Regular Plan – Growth Rs. 10,000/ Month Total per Month Rs. 60,000/- Month The Investment tenure is about ten years (10). Best Regards Mohammed Abdul Bari

Hi Mr. Reddy, There is a little correction to STPs I set up with ICICI. Please read them as follows. Other info in the previous message is correct. STPs with ICICI: 1. HDFC Balance Fund-Regular Plan-Growth Rs. 13,000/- week 2. Tata Equity PE Fund-Regular Plan-Growth Rs. 13,000/-week 3. Kotak Select Focus Fund-Growth Rs. 13,000/-week 4. L And T India Prudence Fund-Growth Rs. 13,000/-week Thanks Best Regards Mohammed Abdulbari

Hi Sir, The above debt funds are not exactly Liquid funds, but most of them are ULTRA SHORT TERM debt funds, which can be slightly riskier than typical Liquid funds. For ex : Birla Sun Life Floating Rate Fund - Short Term Plan is a Liquid fund whereas Birla Sun Life Floating Rate Fund - Long term plan is an Ultra short term debt fund. You may just take a note of this observation.. Portfolio looks fine. All the listed funds are good ones, but there are multiple funds so you may have to take some time out to track them once in a while! Kindly read : https://www.relakhs.com/debt-funds-types-benefits-risk-vs-return/