Case Study on Investing Right with ELSS
Background
Accountant In
Private Firm
25 Years Old
Plans To Marry
In 4 Years
Case Characteristics
- Client is an accountant at a private firm in Ahmedabad. He is 25 years old, unmarried and lives with his family of 5.
- Client’s current salary is Rs.35,000, and he is up for a promotion in March 2022. This will hike his monthly pay to Rs.40,000.
- His family’s monthly expenditure ranges between Rs.40,000 to Rs.45,000.
Fascinating Findings
- Client’s father still works in a private firm and draws a salary of Rs. 60,000
- Client’s mother and brother earn Rs. 15,000 each as tuition teachers.
- He has been investing Rs.3000/month in regular mutual funds for the last 4 years.
- He also pays Rs.1250 as a quarterly premium for a life insurance policy.
- Client plans to get married in 4 years, and wishes to invest & grow his savings for its expenditure.
Actionable Alternatives
- We suggested the client increase his investments by Rs.16,000 for at least 4 years.
- We charted out a plan of investing this amount into 4 different investment vehicles, which included 1 ELSS (equity linked savings scheme) fund and 3 other kinds of funds.
- We suggested that he start investing Rs.4000 each in an ESG fund (Environment, Social & Governance), a technology fund and a midcap fund. A total of Rs.12,000
- The remaining Rs.3000 to be invested in an ELSS fund.
Remarkable Results
Funds Of Growth
The Rs.4000 each into 3 funds grew at the rate of 12%
Risks With Rewards
The ELSS investment of Rs.3000/month clocked a growth of 11%
Hitting The Mark
At the end of 4 years, the total investment grew up to Rs.10,00,000
