D was curious to know,
How much should I save/invest each month if I want to build a corpus of 5 lacs (Rs 500,000) in 5 years? Also, in which financial instrument should I save/invest this monthly amount?
I’d recommend saving Rs 7,000 each month in a 5-year Recurring Deposit at the Post Office. An absolutely safe and disciplined approach to building the targeted corpus. At current interest rates (the interest rate is locked once you open the deposit), the maturity amount would be 5.1 lacs (Rs 510,230) (slightly higher than the target).
What do you think? Can you suggest an alternate investment strategy?