A systematic investment plan (SIP) allows investors to invest a fixed amount regularly. You can set up a SIP with a mutual fund company and instruct them to deduct a fixed amount from your bank account at regular intervals. SIPs are automated, the amount is automatically debited from your bank account, and invested in the mutual funds you have purchased at the predetermined time interval. A systematic investment plan can help you build wealth in the long run through compounding and the power of regular investing. They can make investing more manageable and less stressful by eliminating the need to time the market. On that note, let’s find out how soon you can build over Rs 10 crore corpus with a monthly investment of Rs 12,000 through SIP.
What is compounding?
Compounding helps your investment generate returns not only on the principal investment amount but also on the accumulated returns. The secret to benefiting from compounding is to start early and stay consistent with your investment.
What is SIP?
A systematic investment plan(SIP) allows you to invest a fixed amount in mutual funds. You can invest daily, weekly, monthly, quarterly, or yearly, depending on your choice. Plus, you can start your investment journey with a small amount of Rs 100.
Why should you go for early investment?
To get maximum returns from investment in the long run, one should start investing early.
SIP calculation conditions
Target corpus: Rs 10 crore corpus
Monthly investment: Rs 12,000
Annualised return: 12 per cent
How much can Rs 12,000 monthly SIP build in 10 years?
The investment amount will be Rs 14,40,000, the capital gains will be Rs 12,48,431, and the estimated retirement corpus will be Rs 26,88,431.
How much can Rs 12,000 monthly SIP build in 20 years?
The investment amount will be Rs 28,80,000, the capital gains will be Rs 81,58,288, and the estimated retirement corpus will be Rs 1,10,38,288.
How much can Rs 12,000 monthly SIP build in 30 years?
The investment amount will be Rs 43,20,000, the capital gains will be Rs 3,26,51,679, and the estimated retirement corpus will be Rs 3,69,71,679.
How much can Rs 12,000 monthly SIP build in 39 years?
The investment amount will be Rs 56,16,000, the capital gains will be Rs 9,91,72,977, and the estimated retirement corpus will be Rs 10,47,88,977.
How soon can Rs 12,000 monthly investment in SIP generate over Rs 10 crore corpus?
It will take approximately 39 years to build over Rs 10 crore with Rs 12,000 monthly investment.
Also Read: Power of Rs 1,50,000 PPF Investment: How many years will it take to generate Rs 1.2 lakh/month tax-free income from Public Provident Fund?
