What is 12-15-20 formula of investing that could make you a crorepati by the age of 40?

How to become crorepati: Amid rising inflation concerns, it becomes important for investors to invest their money in instruments that could give bumper returns. During these uncertain times, there are methods that will not only help save money but also make one a crorepati, if followed properly.

How to become a crorepati by investing in mutual funds?

According to certified investment advisors, if an investor puts at least Rs 20,000 every month in mutual funds with an average rate of interest of 12 per cent for 15 years – he/she can become a crorepati (millionaire)

Which Mutual Fund to invest in to become a crorepati?

According to several experts, Equity Mutual Funds have been giving the best returns in the long run, which may go up to a 12 per cent return annually.

To become a crorepati, investors need to follow the Core-satellite investing strategy.

What is core-satellite investing

Core-satellite investing is a method of portfolio construction designed to minimise costs, tax liability, and volatility while providing an opportunity to outperform the broad stock market as a whole.

In the case of Mutual funds, Core and satellite is a time-tested portfolio design that is made up of complementary investments.

It is structured around a "core" asset, such as a large-cap index fund, which makes up the largest portion of the portfolio.

Smaller funds, known as "satellite funds," round out your portfolio and create the rest of your investments.

The goal of this strategy is to achieve more, with less risk.

Investors can invest Rs 15,000 in large-cap and multi-cap funds and Rs 5,000 in mid/small-cap equity funds depending on their risk appetite, with an aim to become a crorepati.