Can large-cap equity MF help you fund your international vacation?

Around 25 million tourists travel abroad for a vacation and this number is predicted to 50 million by 2020, said a recent report published by the United Nations World Tourism Organization. So people are looking forward to exploring the world and it has been observed that many of them have a financial goal to go for an international trip at least once or twice a year.
 
As you are excited to go for a trip, you must also be as prudent when it comes to funding your trip. So we receive a lot of queries as to whether mutual funds and specifically the large-cap equity mutual funds can help fund an international trip?
 
Let's assume that you wish to go for 11 days,10 nights Europe trip with a family of 4, including 2 adults and 2 children in 3 years time, which would cost you Rs. 7 lakh. The average 3-year returns that the large-cap funds have provided is 10.19 per cent among which the worst mutual funds provided 4.95 per cent returns and best fund provided 14.57 per cent. So if we assume large-cap equity mutual fund would provide the same returns in future then you would need to do SIP (Systematic Investment Plan) of Rs. 1,500 per month for 3 years and lumpsum of Rs. 5.23 lakhs if we consider average returns provided by large-cap equity mutual fund. If we consider investment in worst performed large-cap equity mutual fund then you would need to do SIP of Rs. 6,000 or lumpsum of Rs. 6 lakhs and if we consider investment in best performed large-cap equity mutual fund then you would need to do SIP of Rs. 500 or lumpsum of Rs. 4.65 lakhs. It would always be wise to consider the SIP and lumpsum based on the average rate of return provided by mutual funds in this case SIP of Rs. 1,500 or lumpsum of Rs. 5.23 lakhs.
 
It is to be noted that the above illustration doesn’t assume any inflation and it is always advisable to have a financial plan in place to have more clarity on your financial goals such as international vacation. Financial plans differ from person to person, as it considers what is better for you and what should be your course of action based on your risk profile.