Where should I invest for my child’s education and marriage?

My husband is with the armed forces. We have rented out two of our apartments, in Bangalore and Mumbai. We stay in the quarters provided by the government of India. We invest about Rs 1,13,000 in the mutual funds mentioned below:
1. Franklin India Smaller Companies Fund: Rs 5,000
2. SBI Bluechip Fund: Rs 2,500
3. L&T Midcap Fund: Rs 2,500
4. Kotak Select Focus Fund: Rs 1,01,000
5. Mirae Asset Emerging Bluechip Fund: Rs 1,000
6. Sundaram Select Midcap Fund: Rs 1,000
Investments other than this:
1. ICICI Prudential Wealth Builder: Rs 50,000 per year (for minimum 5 years)
2. Kotak Assured Income Plan: Rs 50,000 per year (for 10 years)
Should we invest in one more property? In the future if it gives us good returns like the other two properties, we can then sell the two of them to buy a good house to stay after retirement. We can retain one of the properties to get good rentals. But as per many people, it is not worth investing in real estate (Mumbai) anymore. The prices of properties have already skyrocketed. We are also trying with MHADA (Maharashtra Housing and Area Development Authority) and wanted your advice on the same. We need to save for our 12-year-old child’s education and marriage. We also have an ongoing loan of Rs 21,000 per month, for the house in Mumbai.
--Shetty

Suresh Sadagopan, Founder, Ladder7 Financial Advisories, responds:


Your portfolio has too many schemes for SIPs. Limit the SIPs to just three funds. You may consider Birla Sun Life Frontline Equity Fund, Kotak Select Focus Fund and Mirae Asset India Opportunities Fund.
Property investment in any part of India gives two per cent returns on the current market price. It is too low, hence unworthy of keeping properties for investments. You need to pay society charges, property tax and income tax on the rent and pay the amounts needed to maintain your property from the received rent. There will also be vacancy periods in the property, which needs to be factored in.

You need to consider the current market price, which is the opportunity cost. Furthermore, the appreciation potential is going to be rather limited. The go-go days of property is all but over. One can expect modest returns. Hence, liquidate all the other properties except the residential one and keep investing in simple financial instruments.

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