Making holistic investment choice is always preferred than making random investments. This can be achieved if every investment made is linked to a certain purpose. There are life’s goals which are critical to achieve. That includes – retirement fund accumulation, child’s higher education and marriage etc. Choice of products also depend a lot on the linked goal.
The key to accumulate retirement fund in time is to start at earliest. It is not necessary to start with a bang. You can start with small amounts and increase it as your salary/income increases. Also, if you start early and you have time with you, you can gain advantage of high returns and maximize your investments by investing in equities or equity mutual funds.
Child’s future goals changes in form and size every now and then. Hence it should be tackled by taking help from experts as and when needed. Making assumption about future cost of education involves considering inflation rate of education cost as realistic as possible. Higher studies within India or abroad costs differently based on stream of education and choice of institutes. Funding the cost of marriage of your children also requires prudent steps to be taken at the earliest. As such critical goals come close, the asset allocation should also change accordingly.