MUTUAL FUNDS: HOW LONG IT TAKES TO MAKE RS 1 CRORE WITH MONTHLY SIPS OF RS 1000, 2000, 3000 AND 5000 – CALCULATIONS
The Indian mutual fund industry has been on a roll of late, thanks to the booming stock markets. Nearly all major stock indices are trading at all-time highs, which is also reflected in the surge in the mutual fund industry and monthly SIPs.
Gross investments via systematic investment plans (SIPs) soared to an all-time high of Rs 23,547 crore in August. The total number of SIP accounts climbed to 9.61 crore, and the folio count exceeded 20 crore.
SIP is a very convenient method for investing in mutual funds through standing instructions to debit your bank account each month, eliminating the hassle of writing a cheque every time. SIP has gained popularity among Indian mutual fund investors as it supports rupee cost averaging and promotes disciplined investing, helping investors avoid concerns about market volatility and timing the market.
In this story, we will explore how many years it will take for an investor to accumulate a corpus of Rs 1 crore by investing Rs 1000, 2000, 3000, and 5000 per month, assuming an annualized return of 12% and a 10% increase in the SIP amount each year.
How long does it take to reach Rs 1 crore corpus with Rs 1,000, 2000, 3000 and 5000 SIPs per month?
SIP of Rs 1000 with a 10% step-up each year
If you invest Rs 1000 every month with an average annual return rate of 12% for 31 years, you will accumulate approximately Rs 1.02 crore. Out of this, your total invested amount will be around Rs 21.82 lakh, while the interest accumulated will be around Rs 80 lakh. Remember this calculation assumed that you increase your SIP amount each year by 10%.
SIP of Rs 2000 with a 10% step-up each year
If you invest Rs 2000 every month with 10% step-up every years at an average annual return rate of 12% for 27 years, you will accumulate approximately Rs 1.14 crore. Your total invested amount will be around Rs 29 lakh, and the interest earned will be about Rs 86 lakh.
SIP of Rs 3000 with a 10% step-up each year
An SIP of Rs 3000 per month with a step-up of 10% every year will take you to Rs 1.10 crore in 24 years. In this period, you invest a total Rs 31.86 lakh and earn an interest of Rs 78.61 lakh, taking the total corpus to Rs 1.10 crore.
SIP of Rs 5000 with a 10% step-up every year
If you invest Rs 5000 every month with a step-up of 10% every years at an average annual return rate of 12% for 21 years, you will accumulate approximately Rs 1.16 crore. Your total invested amount will be around Rs 38.40 lakh, while the interest amount comes to Rs 77.96 lakh.
These calculations demonstrate how different SIP amounts can help you achieve your Rs 1 crore corpus goal thanks to substantial returns over time. With larger investments, you can accelerate your journey to your financial goals.
Disclaimer: The above content is for informational purposes only. Mutual Fund investments are subject to market risks. Please consult your financial advisor before investing.
2024-09-16T05:27:43Z dg43tfdfdgfd