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?
With the help of compounding, you can generate returns not only on the principal investment amount but also on the accumulated returns. The secret to benefiting from compounding is to start early and stay consistent with your investment. On that note, let’s find out how fast you can generate Rs 50 lakh corpus with just Rs 1,000, Rs 5,000, and Rs 9,000 monthly investments in a systematic investment plan.
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03:59 PM IST
There is a mindset that if you have to indulge in investment, you must accumulate a sizeable amount to invest, but little do you know that even a small investment amount can make a big difference. For example, if you start your investment journey with a small amount of Rs 1,000 to Rs 9,000, you can end up creating a sizable corpus of Rs 50 lakh, and that too soon. The major factor to note here is investment strategy; with discipline and consistency, you can achieve your target goal with ease. Thus, explore the details below to find out how quickly you can generate Rs 50 lakh by investing monthly in a systematic investment plan.
What is compounding?
Compounding helps you generate returns not only on the principal investment amount but also on the accumulated returns. It helps to grow your wealth in the long run. The secret to benefiting from compounding is to start early and stay consistent with your investment.
What is SIP?
A systematic investment plan(SIP) allows investors to invest a fixed amount in mutual funds. As an investor, you can either 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.
How does SIP work?
A systematic investment plan allows investors to invest a fixed amount regularly. You can set up a SIP with a mutual fund company and instruct them to deduct a fixed amount from your bank account at regular intervals.
Benefits of SIP?
- SIPs can help you build wealth in the long run through compounding and the power of regular investing.
- They can make investing more manageable and less stressful by eliminating the need to time the market.
SIP calculation conditions
- Target corpus: Rs 50 lakh corpus
- Monthly investment: Rs 1,000, Rs 5,000, Rs 9,000
- Annualised return: 12 per cent
How long will it take to build Rs 50 lakh with Rs 1,000 monthly SIP?
It will take approximately 35 years to generate over Rs 50 lakh.
How much can Rs 1,000 monthly SIP build in 35 years?
The investment amount will be Rs 4,20,000, the capital gains will be Rs 50,90,831, and the estimated retirement corpus will be Rs 55,10,831.
How long will it take to build Rs 50 lakh with Rs 5,000 monthly SIP?
It will take approximately 21 years to generate Rs 50 lakh corpus.
How much can Rs 5,000 monthly SIP build in 21 years?
The investment amount will be Rs 12,60,000, the capital gains will be Rs 39,55,034, and the estimated retirement corpus will be Rs 52,15,034.
How long will it take to build Rs 50 lakh with Rs 9,000 monthly SIP?
It will take approximately 17 years to generate over Rs 50 lakh.
How much can Rs 9,000 monthly SIP build in 17 years?
The investment amount will be Rs 18,36,000, the capital gains will be Rs 37,80,660, and the estimated retirement corpus will be Rs 56,16,660.
DISCLAIMER: Not financial advice; invest at your own risk
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