Rajesh, 35-year-old salaried individual wishes to invest Rs. 15 lakhs in different investment avenues. He plans to invest for the education of his two children aged 5 and 8 years old, retirement and contingency. Assuming the role of a Portfolio Management Consultant design a suitable portfolio for Rajesh if – a. He is willing to take moderate risk for his investments.  b. He is a risk neutral investor.

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Emergency Fund

The emergency fund is an amount that is kept aside to meet financial emergencies such as medical expenses and debt settlements. Emergency funds reduce the burden on people during their hardships. People save small portions of their earnings or paychecks as emergency funds to meet financial emergencies. Emergency funds should be saved or invested in such a way that they must be easily liquidated during emergencies. The main purpose of an emergency fund is its availability when required.