Is it okay to invest in NPS to save taxes?
This is my portfolio:
L&T Hybrid Equity Fund: Rs 10,000 per month
ICICI Value Discovery Fund: Rs 10,000 per month
Axis Long Term Equity Fund: Rs 10,000 per month
Franklin Growth Opportunities Fund (Franklin India Opportunities Fund?): Rs 5,000 per month
Tata Balanced Fund: Rs 10,000 per month
DSP BlackRock Small and Midcap Fund: Rs 10,000 per month
I want to increase my monthly investment by Rs 20,000. Kindly advise me on which funds to invest. I am 37 years old and I am looking at an investment time-frame of minimum 10 years. NPS as an investment option does not appeal to me due to its liquidity challenges. Does it make sense to invest in the same from a tax saving point of view?
-- Vineet Singhal
Shifali Satsangee, Founder, Funds Vee’da, responds:
Since we have no idea about your risk profile, we are assuming a moderate risk profile here. Starting with your existing portfolio, you may consider stopping your SIP in Franklin India Opportunities Fund and could consider starting the same amount in a smallcap fund like Franklin India Smaller Companies Fund or SBI Small Cap Fund. You may also consider stopping the Tata Balanced Fund and investing the same amount in L&T Hybrid Equity Fund.
For the additional Rs 20,000 that you want to invest, you may consider an SIP of Rs 10,000 each in two multicap schemes: Motilal Oswal Multicap 35 Fund and Aditya Birla Sun Life Equity Fund.
From a tax saving point of view, you could invest in NPS. The purpose of NPS is to plan for retirement and this is why there are liquidity constraints.
L&T Hybrid Equity Fund: Rs 10,000 per month
ICICI Value Discovery Fund: Rs 10,000 per month
Axis Long Term Equity Fund: Rs 10,000 per month
Franklin Growth Opportunities Fund (Franklin India Opportunities Fund?): Rs 5,000 per month
Tata Balanced Fund: Rs 10,000 per month
DSP BlackRock Small and Midcap Fund: Rs 10,000 per month
I want to increase my monthly investment by Rs 20,000. Kindly advise me on which funds to invest. I am 37 years old and I am looking at an investment time-frame of minimum 10 years. NPS as an investment option does not appeal to me due to its liquidity challenges. Does it make sense to invest in the same from a tax saving point of view?
-- Vineet Singhal
Shifali Satsangee, Founder, Funds Vee’da, responds:
Since we have no idea about your risk profile, we are assuming a moderate risk profile here. Starting with your existing portfolio, you may consider stopping your SIP in Franklin India Opportunities Fund and could consider starting the same amount in a smallcap fund like Franklin India Smaller Companies Fund or SBI Small Cap Fund. You may also consider stopping the Tata Balanced Fund and investing the same amount in L&T Hybrid Equity Fund.
For the additional Rs 20,000 that you want to invest, you may consider an SIP of Rs 10,000 each in two multicap schemes: Motilal Oswal Multicap 35 Fund and Aditya Birla Sun Life Equity Fund.
From a tax saving point of view, you could invest in NPS. The purpose of NPS is to plan for retirement and this is why there are liquidity constraints.