With the kind of returns my fund’s portfolio was showing, and the dividend I was getting from these funds, I came to the conclusion that, making money in stock markets was very easy. Even at this juncture, I was completely unaware of the Dotcom crash or the No-Return periods after 1995 or the Asian crisis of 1998. The 5 years annualized return of mutual funds looked good, only because of the 2003-2004 Bull Run. However, because of my excitement at seeing the profits and because I was getting dividends, I had already invested close to Rs 3 Lacs in mutual funds.
I simply thought that all stocks will make money for me.
How foolish of me?
But due to losses in these unknown companies (although small), I realized that I should only buy shares of large companies. But I still didn’t know which stocks to buy and why to buy them. It was still very random for me, even though I was ready to hold for the long term. And the money I made in TCS, ONGC and ICICI gave me this foolish confidence, that I could not lose money if I stick with large caps.
I realized that despite working for more than 15 years (with 10 spent in Gulf), and also being a good saver, I did not have any plan for the future and was goal-less. All I was doing was to buy some insurance products and some random Mutual Fund and stocks.
I approached PersonalFN to prepare a financial plan and got in touch with a very capable and honest financial planner. During the planning part, I set my goals and the financial plan was ready for investment in line with my risk appetite and the asset allocation.
To cut the long story short, I set a goal of Rs 3 Crores by 2025 for retirement corpus and Rs 1 Crore by 2021 for my child’s education and marriage.
A monthly SIP target of Rs 60,000 was worked out for me. This amount had to be invested in Mutual Funds for my future goals. Though it’s true that I missed out on a good part of my younger age before I started proper investing, I would say that I was still lucky enough not to have any loans at that time when I eventually did start.