I can invest Rs 20,000 a month for the next two years for my wedding. Should I invest in equity or debt funds? I am looking at having Rs 10 lakh.
Amar Patel, Mumbai
Ideally investments in equity funds should have a 3-5-year time horizon. So, your choice of two years as the investment time frame rules out equity exposure, more so because you come across as a first time investor. Likewise, Rs 20,000 a month for two years means you can invest Rs 4.8 lakh all over in the next 24 months, which you are hoping to double. This is a very unrealistic expectation and you should refrain from such high expectations. To ensure you have better returns from what a recurring deposit would pay, you can consider investing every month in short term debt funds like Franklin India Low Duration Fund and HDFC ST Fund.