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Power of Rs 10,000 SIP: Can one achieve Rs 6 crore corpus with Rs 10,000 monthly investment?
- Written by Anamika Singh
Published: Zee Business| Updated: Zee Business
SIP and the power of compounding go hand in hand and they are a popular investment option that can help individuals build a sizeable retirement corpus. Even a small amount can bring a big change. The clue to generating a sizeable corpus is starting early and staying consistent. The power of compounding plays a great role, it encourages people to create goals and then work on them to achieve them. Similarly, if you invest Rs 1o,000 in a monthly systematic investment plan (SIP) you can generate a retirement corpus of Rs 6 crore. Let’s understand how.
Photos source: Pixabay/Representational
(Disclaimer: Our calculations are projections and not investment advice. Do your due diligence or consult an expert for financial planning)
1/10
What is SIP in mutual fund?
1/10A systematic investment plan (SIP) is a process of investing a fixed amount in mutual funds. You can invest daily, weekly, monthly, quarterly, or yearly, it depends on the choice of the investors.
2/10
Why should one invest in mutual fund SIP?
2/10SIP is perfect for beginners, by investing even a small amount regularly, first-time investors can start their journey toward building a sizeable corpus.
3/10
Why should one start investing early?
3/10The earlier you start the more time your money has time to grow. Let’s understand it through a calculation.
4/10
Early investment
4/10Investor A: Starts investing Rs 5,000 a month at age 25 and continues till age 45 (20 years). Total Investment: Rs 12,00,000 Maturity Amount (at 12 per cent annual return): Rs 50,00,000
Investor B: Starts investing Rs 5,000 a month at age 35 and continues till age 55 (20 years). Total Investment: Rs 12,00,000 Maturity Amount (at 12 per cent annual return): Rs 28,00,000
By starting 10 years earlier, Investor A earns Rs 22,00,000 more, showcasing the power of compounding.
5/10
SIP: Calculation condition
5/10Target corpus: Rs 6 crore Monthly investment: Rs 10,000 Annualised return: 12 per cent
6/10
How long it will take to create a corpus of Rs 6 crore?
6/10It will approximately take 35 years to generate Rs 6 crore.
7/10
How much can Rs 10,000 SIP build in 10 years?
7/10The invested amount will be Rs 12,00,000, the capital gains will be Rs 11,23,391, and the estimated retirement corpus will be Rs 23,23,391.
8/10
How much can Rs 10,000 SIP build in 20 years?
8/10The invested amount will be Rs 24,00,000, the capital gains will be Rs 75,91,479, and the estimated retirement corpus will be Rs 99,91,479.
9/10
How much can Rs 10,000 SIP generate in 30 years?
9/10The invested amount will be Rs 36,00,000, the capital gains will be Rs 3,16,99,138, and the estimated retirement corpus will be Rs 3,52,99,138.
10/10
How much can Rs 10,000 SIP generate in 35 years?
10/10The invested amount will be Rs 42,00,000, the capital gains will be Rs 6,07,52,691, and the estimated retirement corpus will be Rs 6,49,52,691.
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