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Aligning long-term goals with investments gives us confidence

LiveMint logoLiveMint 05-03-2017 Shaikh Zoaib Saleem

Being aware and informed helps. As happened with Navi Mumbai-based Kaushal Dongre. He became aware of investing in mutual funds through systematic investment plans (SIPs) from reading personal finance related news. Eventually he started investing in regular mutual fund plans through an agent. However, Kaushal and his wife Sayali, felt a strong need to consult a planner to align their long-term goals when they were expecting their child in 2013.

“I was already a regular reader of personal finance-related articles. That is when I realised that through SIPs, you can generate long-term wealth by investing a small amount regularly. Around the same time, I started looking for a financial adviser,” Kaushal said.

The couple wanted to focus on long-term financial security for their child. “I decided to meet Melvin Joseph (their financial adviser) to align our long-term goals,” he said.

“Even before meeting Melvin, I had anyway started investing through SIPs,” Kaushal said. But the financial planner made major changes in the couple’s portfolio by changing the funds they were investing in. “I was not even aware of direct plans,” Kaushal said. The adviser explained to them how over a period of 15-20 years, almost 18-20% of their returns could go to the agent. Accordingly, they shifted from regular plans to direct plans.

Kaushal said that the returns on his mutual fund investments are now better compared to his investments earlier. “But I don’t track the returns very frequently. The reason is that I intend to not touch these investments till our son turns 18. That is how long I am planning to remain invested. The major difference has been that he (Melvin) suggested the funds where we should invest,” he said.

At the same time, Kaushal decided to invest a lump-sum in a few selected individual stocks whose fundamentals were strong. “I wanted to buy a slightly expensive car but ended up saving a lump sum as I bought a car a notch lower,” he said. The couple’s planner, however, was not keen on direct investments in equity. “His assertion is that it is always safer to invest in mutual funds. But I still picked up stocks that were fundamentally strong. I want to remain invested for at least 4-5 years,” he said.

The couple is currently focusing only on long-term goals. “The best thing is that we are investing for the long term, which gives us confidence,” said Sayali. In 2013, Kaushal also bought an office for his business, which he said is a long-term asset for both business and family.

Sayali, too, has started actively discussing and understanding investments and financial instruments. “Earlier, I would not get involved but over a period of time, I started understanding certain things and we discuss among ourselves if we have to make any changes to investments or while making new ones,” she said.

While Sayali has not met the planner herself, but she eventually plans to. “I am an interior designer and was working earlier. I am planning to start working again once our son starts going to school. Considering our good experience with our planner, I will surely consult him when I start working again,” Sayali said.

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