Investment alert! How to become crorepati: If you have this 6 figure sum, then put it here

If you have a certain amount of money and are dreaming of becoming a crorepati, then don't just sit on it, do this and become rich.

Investment alert! How to become crorepati: If you have this 6 figure sum, then put it here
Mutual fund investments are subject to market risk but in long-term, an investor can think of near 11 per cent post-tax return on equity mutual fund in the long term. Photo: Pixabay
By Asit Manohar
Updated: Wed, May 01, 2019
03:30 pm
New Delhi, ZeeBiz WebDesk
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How to become a crorepati is a constant refrain in every employee and businessman's mind. Well, it is tough, but not that difficult to become one. Investment is basically meant to make your life easier but while investing it's not that easy to pick where to invest and how much the investment ought to be. People are well aware of mutual funds but they are not aware of the kinds of schemes available in the market that may suit them. For such investors, it's better to go by what the investment advisors say rather than committing to any foolish investment decision that leads to a loss in coming times because the lesser return is basically a loss, which people don't notice, much to their chagrin. 

Choosing a SIP or some other mode of investment plan may be easy but when you need to decide whether to go for a lump sum investment of say, Rs 5 lakh, then choosing a plan of action is more difficult. For an investor looking for a one-time investment of Rs 5,00,000, who is ready to take the risk to become a crorepati, but not unnecessary risk, the question has many consequences. 

See SBI Mutual Fund calculator below:

Thankfully, investment experts have a take on this and say equity mutual funds are a better option for these 'wannabe crorepati-types' as it would give better returns over the long-term - 25 to 30 years.

Speaking on the equity mutual fund rate of returns that an investor can expect in a one-time investment for up to 30 years, SEBI registered investment and financial planner Manikaran Singhal said, "Equity mutual funds would give at least 11 per cent post-tax return in long-term term say 25 to 30 years." He said that there is no thumb rule of investing in equity, small savings or mutual funds as it depends more on the investor's risk tolerance, risk capacity, risk required and risk perception.

So, as per Singhal, an investor having Rs 5 lakh in her or his kitty, can invest in the equity mutual funds. SBI mutual fund calculator says for 30 years of investment of Rs 5 lakh lumpsum amount would give Rs 1.14 crore if the interest rate is 11 per cent after cutting tax. Remember, the 11 per cent return is post-tax return, which means this Rs 1.14 crore after Rs 5 lakh investment is pure income.

An investor should, however, know that there is no guarantee as far as investment in equity is concerned and any investment she or he does, should be on the advice of an expert.