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I want to generate 5L in 3 years, how much should I invest monthly? I do not want to take much risk.

I am investing 4K / month - should I increase my investment?

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1 Approved Answer

aniket

Awesome target!

Generating a return of ₹5L in a short span of time necessitates higher risk exposure. Therefore, you may either choose to invest for a longer term or increase the amount of your monthly investment.

One scheme that you may look at is Start Investing with Rs 3000 - Moderate Risk. Though the minimum investment in this scheme is ₹3000, to accumulate the amount that you desire, investing a sum of ₹7000 in this fund for a period of three years will help you, provided the fund operates at its three year annualized trailing return of 12.26% p.a. This fund is apt if you do not wish to be exposed to high levels of risk, as it diversifies investment across equity and debt securities.

Another scheme that you can evaluate is Hybrid Portfolio - Debt Oriented For Short Term. Considering that the fund has generated an annualized return of 11.33% over a period of 3 years, to accumulate ₹5L you need to invest at least ₹12,000 per month in this scheme. The fund invests majority of the corpus in debt securities, thereby providing adequate risk cover for investing money for 3 years.

Deducting management fees may reduce your effective returns slightly.

Also, it is important to note that these calculations have been made assuming past performance will be replicated in the future. This assumption, in no way, guarantees future performance.

Considering that you are investing ₹4000 in another SIP, I would advice you to compare the returns of your existing scheme with the schemes mentioned above, and accordingly make a decision to invest your money in the scheme that best meets your need.

To understand how you can increase the amount of your SIP, click here.

Mutual fund investments are subject to market risks. Please read the scheme information and other related documents carefully before investing.
Past performance is not indicative of future returns. Please consider your specific investment requirements, risk tolerance, investment goal, time frame, risk and reward balance and the cost associated with the investment before choosing a fund, or designing a portfolio that suits your needs.
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