Ahmedabad: Gujarat’s mutual fund market is witnessing a new wave of investors as retirees and individuals inheriting family wealth increasingly liquidate real estate holdings and channel the proceeds into professionally managed financial portfolios, according to wealth managers and distributors.Financial advisers said the trend was being driven by a combination of practical and financial considerations, with senior citizens seeking regular income, better liquidity and simpler succession planning after retirement. The shift was particularly evident among families whose children have settled abroad or in other Indian cities, making the transfer and management of physical assets more complicated.For 59-year-old company secretary Umesh Ved, succession planning was the primary motivation behind restructuring his portfolio. “I have recently consolidated my real estate assets into financial assets. Being an active investor in equities and MFs, I’ve always remained keen on these assets as they’re much easier to transfer to legal heirs than physical assets,” Ved said. “With gold or silver, there is always the risk of misuse or disputes. Financial assets are documented and transmission is much simpler.”Wealth managers said another growing category comprises individuals who inherit multiple properties after the death of their parents but choose to monetise those assets rather than retain them. Instead of reinvesting in property or parking the money in fixed deposits or gold, many are opting for mutual funds.“People in their 50s and 60s increasingly begin consolidating their assets. It starts with simple things like reducing five or six bank accounts to two and eventually extends to larger assets such as property. If children live in another city or abroad, transmitting real estate after a death in the family can become a lengthy and cumbersome process. Financial assets such as mutual funds are much easier to transfer to legal heirs, and that is one of the biggest reasons we are seeing this shift,” said Mumukshu Desai, director of a city-based financial advisory firm.Advisers said improving investor confidence in equity markets and relatively lower returns from traditional savings instruments are accelerating the transition.“Govt’s equity exposure through the National Pension System has increased people’s confidence in equity and mutual funds. Lower fixed deposit rates is another reason,” said Jaydevsinh Chudasama, founder of a mutual fund distribution company.Paresh Raval, who retired last year as principal of a leading technical college, said declining returns from conventional investment avenues prompted him to move his retirement corpus into mutual funds. “I decided to invest my entire retirement fund in mutual funds. Bank deposit interest rates have declined and so have returns from other guaranteed schemes,” he said.Raval added that liquidity was equally important. “Real estate requires a large investment and is not easy to sell when money is needed. In mutual funds, you can withdraw only the amount you require and receive the money quickly.”Entrepreneur Hardik Acharya said investors are increasingly evaluating returns after accounting for taxes, maintenance costs and liquidity. “Many investors assume real estate always delivers superior returns, but once you factor in holding costs and taxes, diversified financial assets can generate better risk-adjusted and tax-efficient returns,” he said, adding that affluent investors are also gradually increasing allocations to alternative assets such as private equity and startups, signalling a broader shift away from property-led wealth creation.
