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SIP of Rs 2,100/Month at 20: How long to build a Rs 2 crore corpus? Check inside
- Written by Bhawna Gupta
Published: Zee Business| Updated: Zee Business
If you start an SIP early and continue it for years, you can definitely achieve your financial goals. A SIP or systematic investment plan is one of the methods to invest in mutual funds. The key rule is to stay invested and let compound interest play its role over the years. Although SIPs don't provide guaranteed returns, historical long-term equity returns show how regular investing can help investors achieve major financial goals.
For example, if an individual is 20 years old and wants to achieve a Rs 2 crore corpus for retirement, they may not need to invest a very large amount every month, but need to be consistent. In this article, we will show the calculations for the same financial goal.
Images: Pixabay, Freepik
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How much time do you need to create a Rs 2 crore corpus?
1/11It depends on your monthly SIP amount. If you are making big investments every month, you need to invest for less number of years. We will show calculations for different time periods in this article.
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SIP makes you a disciplined investor
2/11As you invest regularly in mutual funds through SIP, it makes you a disciplined investor.
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Can SIPs help you create a large retirement fund?
3/11Yes, even small SIPs can turn into a sizeable corpus till retirement.
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What is rupee cost averaging in SIP?
4/11The rupee cost averaging in SIP means you are buying more units when the market is down and fewer when the market is up.
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Minimum amount to start an SIP?
5/11You can start an SIP with as little as Rs 500 per month.
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Can you stop or change SIP?
6/11Yes, there is so much flexibility in SIP. You can change your mutual funds or even stop investing for any reason.
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What is the withdrawal rule in SIP?
7/11Most open-ended mutual funds allow investors to withdraw their money at any time they want to. This is subject to an exit load that depends on the funds.
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How to create a Rs 2 crore fund with Rs 2,100 monthly SIP
8/11If you start your SIP at 20 years of age and continue it for 40 years, you may achieve this financial goal of creating Rs 2,00,00,000 corpus, calculations show.
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Calculations
9/11Monthly SIP: Rs 2,100 Expected return: 12% Period: 40 years Total investment: Rs 10,08,000 Estimated returns: Rs 1,95,57,449 Total value: Rs 2,05,65,449
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What if I start SIP at 35 years of age and want to create a Rs 2 crore corpus?
10/11If you start investing at 35 and want to create a Rs 2 crore fund at retirement, then you will have to make an SIP of Rs 12,000 per month for 25 years continuously, as per the calculations.
11/11
Calculations
11/11Monthly SIP: Rs 12,000 Expected return: 12% Period: 25 years Total investment: Rs 36,00,000 Estimated returns: Rs 1,68,26,479 Total value: Rs 2,04,26,479
Our calculations are projections and not investment advice. Do your own due diligence or consult an expert for financial planning.
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