Retirement Planning: How Rs 6,00,000 one-time investment can create Rs 1,80,00,000 retirement corpus

Retirement Planning: A one-time investment can grow many times if one invests it for a long time and gets the benefit of compound growth. A Rs 6 lakh lump sum investment can turn into Rs 1.80 crore.

Shaghil Bilali | Jan 26, 2025, 04:18 PM IST

Power of Compounding, Retirement Corpus: Retirement planning is an important goal for everyone. In old age, everyone needs a substantial amount to live life comfortably. This money can come from an investment, a monthly pension, or income sources. For those who want to get a retirement corpus from investment returns, they need to begin their investment journey early. The benefit of it can be that they can start with a small amount, yet they can create a sizeable corpus. The small amount can grow to a large corpus for early starters as they will get more years for the compounding of their investments compared to investors who start their investment journey late. In this write-up, know more about how compound growth can increase your investments exponentially and how a Rs 6,00,000 one-time investment can spring to a Rs 1,80,00,000 retirement corpus. 
Photos: Unsplash/Pixabay

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Importance of retirement corpus

Importance of retirement corpus

When you grow old, expenses remain the same, may increase, or decrease. But in either case, you need money to run your daily expenses. For that reason, a person needs a retirement corpus that can help them manage their expenses post retirement.

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How can retirement corpus be generated?

How can retirement corpus be generated?

It can be generated through investments or generating income sources. If one wants to build it through investment, they need to start investing early in their career.

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What's the benefit of starting early? 

What's the benefit of starting early? 

If someone starts investing early, they get more years for compounding of their investments. As a result, their corpus can grow faster as it gets older.

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See examples

See examples

If someone starts a Rs 5,000 monthly SIP investment and gets a 12 per cent annualised return on that, they can create an estimated corpus of Rs 3.25 crore in 35 years, while their investment during this period will be just Rs 21,00,000.

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From Rs 5 lakh investment to Rs 1.5 cr corpus

From Rs 5 lakh investment to Rs 1.5 cr corpus

Similarly, if one invests a lump sum amount of Rs 5 lakh and gets a 12 per cent annualised return on it, they can create an estimated corpus of Rs 1,49,79,961 in 30 years.

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From Rs 6 lakh investment to Rs 1.8 crore corpus

From Rs 6 lakh investment to Rs 1.8 crore corpus

Here, we take the example of a Rs 6 lakh lump sum investment. We are taking the investment duration of 30 years and annualised return as 12 per cent. We will show how this money will grow in 10, 20, and 30 years.

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Corpus from Rs 6 lakh lump sum investment in 10 years

Corpus from Rs 6 lakh lump sum investment in 10 years

In 10 years, estimated capital gains will be Rs 12,63,509, and the estimated corpus will be Rs 18,63,509.

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Corpus from Rs 6 lakh lump sum investment in 10 years

Corpus from Rs 6 lakh lump sum investment in 10 years

In 20 years, estimated capital gains will be Rs 51,87,776, and the estimated corpus will be Rs 57,87,776.

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From Rs 6 lakh investment to Rs 1.8 crore corpus

From Rs 6 lakh investment to Rs 1.8 crore corpus

In 30 years, estimated capital gains will be Rs 1,73,75,953, and the estimated corpus will be Rs 1,79,75,953.

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What are learnings?

What are learnings?

Here, we see that in every 10 years, the corpus is growing faster. It's because of compound growth on returns, which gets faster with time.

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Corpus growth from 0-10 years

Corpus growth from 0-10 years

From 0-10 years, the estimated corpus grew to Rs 18,63,509.

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Corpus growth from 10-20 years

Corpus growth from 10-20 years

From 10-20 years, it grew by Rs 39,24,267.

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Corpus growth from 20-30 years

Corpus growth from 20-30 years

From 20-30 years, the corpus saw an estimated growth of Rs 1,21,88,177.

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