SIP returns: Mutual fund is one of the preferred methods of investment today and a systematic investment plan (SIP) is one of the convenient facilities to invest in mutual funds. While investing in mutual funds, it is necessary for investors to have a specific goal in mind as it helps in better financial planning for the future.

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According to experts, the key to getting the most out of mutual fund SIP is to stay invested for a long time. While choosing a decent fund is dependent on a variety of criteria, for which you should seek professional guidance, this article examines how long it will take for an investor to reach Rs 5 crore using SIP (assuming 12 per cent annualised returns).

According to Vivek Sharma- Director (strategy) and head of investments at Gulaq, a part of the Estee group, "One can create a corpus of Rs 5 crore in 20 years if they invest Rs 10,000 per month in equity markets. However, if they increase their SIP to Rs 20,000, they can reach this milestone in 15 years."

The below chart shows the time it takes to get to Rs 5 crore corpus when we invest with fixed SIPs. We have also shown the impact of increasing our SIP by 6 per cent per annum. The growth rate assumes is 12 per cent.

“In order to follow this plan, we must learn to avoid the short-term noise in the markets,” said Sharma.

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