Compounding Returns: Starting monthly SIP investment Rs 10,000, Rs 15,000, or Rs 20,000? Know how large retirement corpus you can create in 20-30 years
Compounding Returns: Saving 20 per cent of the monthly income and investing it in a scheme where you get compound returns can help generate a retirement corpus that can fulfil your future requirements.
Compounding Returns: Want to start investing but are discouraged by vague thoughts such as, how will my small investment make a difference? Will I generate a large corpus with such a small monthly investment? Will I be able to continue this investment in a volatile job market? These are excuses that discourage people from starting their investments. But the best way is to start from somewhere rather than sitting on the fence and see others getting rich. Even if one manages to save 20 per cent of their income and starts investing in a scheme where they compound returns, the long-term investment can bring them magical results. A small investment done consistently for years will create a sizeable retirement corpus.
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(Disclaimer: This is not investment advice. Do your own due diligence or consult an expert for retirement planning.)
Retirement corpus calculations
We will take mutual fund SIP monthly investments of Rs 10,000, Rs 15,000, and Rs 20,000. Since we are calculating a retirement corpus, we take durations of 20 years, 25 years, and 30 years. The rate of annualised return in each will be 12 per cent.
Retirement corpus from Rs 10,000 monthly SIP investment in 20 years
In 20 years, the invested amount will be Rs 24,00,000, estimated capital gains will be Rs 75,91,479, and the estimated retirement corpus will be Rs 99,91,479.
Retirement corpus from Rs 10,000 monthly SIP investment in 25 years
In 25 years, the invested amount will be Rs 30,00,000, estimated capital gains will be Rs 1,59,76,351, and the estimated retirement corpus will be Rs 1,89,76,351.
Retirement corpus from Rs 10,000 monthly SIP investment in 30 years
In 30 years, the invested amount will be Rs 36,00,000, estimated capital gains will be Rs 3,16,99,138, and the estimated retirement corpus will be Rs 3,52,99,138.
Retirement corpus from Rs 15,000 monthly SIP investment in 20 years
The invested amount in 20 years will be Rs 36,00,000, estimated capital gains will be Rs 1,13,87,219, and the estimated retirement corpus will be Rs 1,49,87,219.
Retirement corpus from Rs 15,000 monthly SIP investment in 25 years
The total investment will be Rs 45,00,000, estimated capital gains will be Rs 2,39,64,526, and the estimated corpus will be Rs 2,84,64,526.
Retirement corpus from Rs 15,000 monthly SIP investment in 30 years
The total investment will be Rs 54,00,000, estimated capital gains will be Rs 4,75,48,707, and the estimated corpus will be Rs 5,29,48,707.
Retirement corpus from Rs 20,000 monthly SIP investment in 20 years
At 20,000 monthly SIP investment, the total investment in 20 years will be Rs 48,00,000, estimated capital gains will be Rs 1,51,82,958, the estimated retirement corpus will be Rs 1,99,82,958.
Retirement corpus from Rs 20,000 monthly SIP investment in 25 years
In 25 years, the investment will be Rs 60,00,000, estimated capital gains will be Rs 3,19,52,702, and the estimated retirement corpus will be Rs 3,79,52,702.
Retirement corpus from Rs 20,000 monthly SIP investment in 30 years
The invested amount in 30 years will be Rs 72,00,000, estimated capital gains will be Rs 6,33,98,275, and the estimated retirement corpus will be Rs 7,05,98,275.