Power of Rs 5,000 SIP: How fast can you generate Rs 85 lakh corpus with just Rs 5,000 monthly investment?
Let’s find out how fast you can generate Rs 85 lakh corpus with just Rs 5,000 monthly investment. How many years will it take you to reach this target?
)
05:57 PM IST
A big amount like Rs 20,000 or more can indeed do wonders in investment, but one should not underestimate the power of a small amount. It can make a big difference in the long run. An example would work best to make you understand how a small amount can make a big change. The secret lies in early investment. For example, suppose 2 friends, namely Priyanka and Rishav, thought of investing in a systematic investment plan (SIP). Priyanka started her investment journey instantly at the age of 25 with Rs 5,000 as a monthly investment. She continued investing till the age of 45 for approximately 20 years. In return, at the end of the investment period, she would probably get an estimated Rs 12,00,000 (at 12 per cent annual return).
On the other hand, Rishav decided not to invest instantly as Priyanka did, and he decided to wait until he turned 35. At the age of 35, he is all set to invest the same amount as Priyanka, Rs 5,000. He continues till age 45 (10 years). Rishav would probably get an estimated Rs 11,20,179 (at 12 per cent annual return). By starting 10 years earlier, Priyanka earned Rs 34,79,108 more, showcasing the power of compounding. On that note, let’s find out how quickly you can generate a Rs 85 lakh corpus with just a Rs 5,000 monthly investment.
Also read: How quickly can you generate Rs 1 crore corpus? The timeline will amaze you
What is SIP?
A systematic investment plan(SIP) allows you to invest a fixed amount in mutual funds (s). 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.
What is compounding?
Compounding helps generate returns not only on the amount you initially invested but also on the profits the investment makes in the long run. The longer you stay invested, the greater profit you get in the long run.
Why should you go for early investment?
To get maximum returns from investment in the long run, one should start investing early. Check out the example given above in the introduction part to understand why investing early is worthwhile.
SIP calculation conditions
- Target corpus: Rs 85 lakh corpus
- Monthly investment: Rs 5,000
- Annualised return: 12 per cent
How long will it take to generate Rs 1 crore corpus with Rs 3,000 monthly SIP?
It will take approximately 25 years to generate over Rs 1 crore.
How much can Rs 5,000 monthly SIP build in 10 years?
The investment amount will be Rs 6,00,000, the capital gains will be Rs 5,20,179, and the estimated retirement corpus will be Rs 11,20,179.
How much can Rs 5,000 monthly SIP build in 15 years?
The investment amount will be Rs 9,00,000, the capital gains will be Rs 14,79,657, and the estimated retirement corpus will be Rs 23,79,657.
How much can Rs 5,000 monthly SIP build in 20 years?
The investment amount will be Rs 12,00,000, the capital gains will be Rs 33,99,287, and the estimated retirement corpus will be Rs 45,99,287.
How much can Rs 5,000 monthly SIP build in 25 years?
The investment amount will be Rs 15,00,000, the capital gains will be Rs 70,11,033, and the estimated retirement corpus will be Rs 85,11,033.
DISCLAIMER: For information only, consult an advisor before investing
Get Latest Business News, Stock Market Updates and Videos; Check your tax outgo through Income Tax Calculator and save money through our Personal Finance coverage. Check Business Breaking News Live on Zee Business Twitter and Facebook. Subscribe on YouTube.
RECOMMENDED STORIES
)
)
)
)
)
)
)
SIP Calculation at 12% Annualised Return: Rs 9,000/month investment, starting at age 25, how soon can you generate Rs 1 crore corpus?
Power of Compounding: How quickly can you build Rs 50 lakh corpus with just Rs 1,000, Rs 5,000, and Rs 9,000 monthly investments?
Power of Compounding: How many years will it take to build Rs 60 lakh corpus with just Rs 2,000, Rs 4,000, and Rs 6,000 monthly investments?
Power of 12% SIP Return: How quickly you can generate Rs 10 crore, Rs 12 crore, and Rs 15 crore retirement corpus with Rs 25,000/month investment
Power of Compounding: How many years will it take to build Rs 90 lakh corpus with just Rs 4,000, Rs 6,000, and Rs 9,000 monthly investments?
