5+15+25 SIP Formula: In how many years, can Rs 5,000 monthly SIP investment grow to over Rs 1.3 crore fund?

Systematic Investment Plan, commonly known as SIP, is a method of investing in mutual funds where investors can invest money based on their financial capacity.

People are allowed to invest a fixed amount at regular intervals in SIP. 

These regular intervals can be monthly, quarterly, or yearly.

- Power of compounding - Rupee Cost Averaging - Cost Effective - Diversification

If you, too, want to accumulate a substantial corpus for your future financial needs and wish to invest in SIP mutual funds but are confused about how to approach, then the 5+15+25 SIP formula may be beneficial for you.

This formula helps an investor to create a wealth of around Rs 1.3 crore if he/she start investing in a mutual fund SIP and continue for 25 years. Wondering how? Let's understand how it works.

In the formula -  First "5" -  represents a monthly SIP of Rs 5,000.  Second "15" - denotes the annualised SIP returns.  And "25" - signifies the number of years, i.e., one needs to invest in SIP for 25 years.

Using this formula, if you start investing Rs 5,000 every month in SIP mutual fund and continue for 25 years, your total investment will amount to Rs 15,00,000.

In 25 years, your investment will grow by around Rs 1,22,82,804 in the form of capital gains. It should be noted that the average return rate here is considered to be 15 per cent. 

At the end of the 25 years, combining your initial investment and the capital gain, you will accumulate an estimated amount of Rs 1,37,82,804.

Total Investment: 15,00,000 Expected Capital Gains: 1,22,82,804 Final Corpus: Rs 1,37,82,804

By following the 5+15+25 formula, you can amass Rs 1.3 crore and become a crorepati in 25 years.