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Mutual funds · Goal planner
Start from the goal, and work back to the monthly amount.
Name the goal, what it will cost and when you need it. The planner works out the monthly SIP that would reach it at the return you assume — a plan to discuss, not a promise.
Reviewed
In short
- Use the cost when you will need the money, raised for inflation, not today’s price.
- Plan at a cautious return; the market will not follow your assumption.
- Review the plan when your income, goals or markets change.
Allowing for inflation
A course that costs ₹10 lakh today will cost more when your child starts it. At 6% a year, ₹10 lakh becomes about ₹17.9 lakh in ten years.
Matching risk to time
Money needed within a few years usually belongs in steadier funds; equity is generally considered for horizons of five years or more.
Goal planner
An illustration: today’s cost raised by the inflation you choose, and a monthly SIP at the return you choose, compounded monthly. Returns are not guaranteed and can be negative. Mutual fund investments are subject to market risks; read all scheme related documents carefully.
What to check
These decide what you actually keep. Read them before the return figure.
The assumed return
See what a lower rate does to the plan before relying on a higher one.
Inflation
The goal’s cost on the day you need it, not today.
Protection first
Term and health cover keep a goal on track if something happens to the person paying for it.
An emergency fund
Keep a few months’ expenses aside so a goal’s money is never needed for an emergency.
Questions people ask
General guidance. The scheme document decides the specifics, and tax rules change.
What return should I assume?
Any figure is an assumption. Plan at a cautious rate, and look at what a lower one does to the plan.
What if I cannot afford the monthly amount?
Start with what you can, allow more time, or plan to increase the SIP each year as your income rises.
Should every goal be in equity funds?
No. The shorter the time to the goal, the less a fall can be recovered, so short-term goals usually belong in steadier funds.
Mutual fund investments are subject to market risks, read all scheme related documents carefully. Past performance does not indicate future returns. Regular plans involve payment of commission to distributors.