How investing Rs 6,000 per month can make you Crorepati

When you start investing, the main aim is to save enough money for the future. Generally, people tend to start from less amount.

Investments always involve certain risk. But as the saying goes, "higher the risk, higher the returns".

However, there is one financial instrument which can help you reducing the risk and at the same time, will give you robust returns. 

Enter Systematic Investment Plan (SIPs)in mutual funds. In a SIP, an investor has to set aside small amounts of money either monthly or quarterly  and the amount of investment can be as low as Rs 500. 

An investor will eventually develop a habit of investment. The only thumb rule to keep in mind is to "start early". In simple language, the early you start, more returns you will get at the time of maturity. The more you procrastinate, the more you have to pay 'delay cost'. Which means less returns from more investment. 

For instance, generally, a person starts earning at the age of 23 years. If he keeps on investing a small amount regularly in SIPs, after say 20 years, he can become a "Crorepati".

Yes, you read it right. We tell you how.

Say you are investing Rs 6,000 in SIPs per month for 17 years with an expected rate of return of 20% per annum. This means, your investment amount is Rs 12,24,000 for the entire time period. At the time of maturity, which is after 17 years, your maturity amount will be Rs 1.01 crore. Clearly, your earning on investment will be Rs 89,04,992.

Even a two-year break from your Rs 1000 monthly SIP can cost you lakhs