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Rs 19 Lakh Lump Sum Investment in Mutual Funds: How many years can it take to create a Rs 1 crore, Rs 2 crore & Rs 3 crore corpus?
- Written by Priya Vishwakarma
Published: Zee Business| Updated: Zee Business
Power of Lump Sum Investment In Mutual Funds: Some people prefer to invest a lump sum amount instead of monthly investments. If you are one of them and are looking for an investment option where you can invest your lump sum amount for a long period and create substantial wealth, then mutual fund investment can be a good option. It is an asset class that parks funds in various assets like stocks, equity, and bonds on behalf of investors.
But how does it help in building a bigger corpus in the long run? Through the magic of compounding. However, time also plays an important role. The longer you invest, the more profits you will make in the long run. Let us understand this with example.
In this write-up, we will go through the calculations to explain how many years a Rs 19 lakh lump sum investment in a mutual fund will take to create a retirement corpus of Rs 1 crore, Rs 2 crore, and Rs 3 crore -
Photos Credit: Pixabay/Canva
(Disclaimer: Our calculations are projections and not investment advice. Do your own due diligence or consult an expert for financial planning.)
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Long-term mutual fund investment strategy: Wealth generation through compounding
1/8Compounding is a process in which one can earn capital gains not only on the principal but also on the capital gains earned earlier. This creates a snowball effect that helps your investments grow faster over time.
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Mutual fund investment plan for retirement: Assuming a 12% annualised return
2/8Here, we are assuming a 12 per cent annualised return rate for all the calculations. However, the returns may vary depending on market conditions.
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Rs 19 lakh lump sum investment in MF: How many years will it take to create a Rs 1 crore corpus?
3/8According to the calculations, you would have to invest in mutual funds for at least 15 years to create a corpus of Rs 1 crore with a lump sum investment of Rs 19 lakh. Over these years, you can expect a total of Rs 84,99,775 (on an average) as capital gains.
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How to build Rs 1 crore corpus from mutual funds: Calculations
4/8Total Investment Amount: Rs 19,00,000
Capital Gains: Rs 84,99,775 (expected)
Total Approx. Return: Rs 1,03,99,775
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Rs 19 lakh lump sum investment in MF: How many years will it take to create a Rs 2 crore corpus?
5/8To create a retirement corpus of Rs 2 crore with a Rs 19 lakh lump sum investment, you need to invest for at least 21 years in mutual funds. In these years, you can expect a total of Rs 1,86,27,312 as capital gains.
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Mutual fund investment for 21 years: Calculations
6/8Total Investment Amount: Rs 19,00,000
Capital Gains: Rs 1,86,27,312 (expected)
Total Approx. Return: Rs 2,05,27,312
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Rs 19 lakh lumpsum to Rs 3 crore mutual fund investment plan: How many years will it take?
7/8To create a retirement fund of Rs 3 crore from a lump sum investment of Rs 19 lakh, you would have to invest in mutual funds for at least 25 years. In this case, you can expect a capital gain of Rs 3,04,00,122.
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Rs 19 lakh investment to Rs 3 crore plan: Calculations
8/8Total Investment Amount: Rs 19,00,000
Capital Gains: Rs 3,04,00,122 (expected)
Total Approx. Return: Rs 3,23,00,122
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