SIP+Lump Sum for Retirement Planning: Starting to invest early has its own benefits, and nothing can beat investing with your first income and prolonging it till retirement. It provides a long-term investment that helps you get high compound growth, plus you may keep revising your investment strategy to achieve desired results. If you start to invest at 25 years of age with a lump sum investment supplemented with a monthly systematic investment plan (SIP) investment, you may create an estimated Rs 11.44 crore corpus by 60 years of age. Know how it may be possible and what kind of returns you need to achieve that corps. 

Benefits of starting to invest early 

The investor who begins their investment journey early gets more years for the compound growth of their investment compared to a later starter. 

Take the example of A and B, where A is 25 years old and B is 35. Both start to invest Rs 20,000 in a mutual fund SIP and want to continue it till 60 years of age.

A has a 35-year investment horizon, while B has 25. Both expect a 12 per cent annualised return on their respective investments. 

In 35 years, A’s total investment will be Rs 84,00,000, estimated capital gains will be Rs 10,18,16,623, and the estimated corpus will be Rs 11,02,16,623.

In 25 years, B’s total investment will be Rs 60,00,000, estimated capital gains will be Rs 2,80,44,131, and the estimated corpus will be Rs 3,40,44,131.

Here, you can see that A’s extra investment in 10 years is Rs 24,00,000, but the extra capital gains they generate are Rs 7,37,72,492.   

How you may generate Rs 11.44 cr corpus

If you are 25 years old, invest a Rs 6 lakh lump sum amount, start investing Rs 15,000 monthly SIP, and get a 12 per cent annualised return on both, you may generate an estimated Rs 11.44 crore corpus by 60 years of age. Know it may be possible- 

Corpus from Rs 6 lakh investment 

At a 12 per cent annualised return, estimated capital gains in 35 years will be Rs 3,10,79,772, and the estimated corpus will be Rs 3,16,79,772.

Corpus from Rs 15,000 SIP investment

The total investment in 35 years will be Rs 63,00,000, estimated capital gains will be Rs 7,63,62,467, and the estimated corpus will be Rs 8,26,62,467.

Total investment, total corpus

While the total investment will be Rs 69,00,000, the estimated total investment Rs 11,43,42,239.

(Disclaimer: This is not investment advice. Do your own due diligence or consult an expert for financial planning.)