Rs 4,000 Monthly SIP for 33 years vs Rs 40,000 Monthly SIP for 15 Years: Which can give you higher corpus in long term? See calculations
Rs 4,000 Monthly SIP for 33 years vs Rs 40,000 Monthly SIP for 15 Years: Time is king in terms of investment. The longer one stays in their investment, the larger the corpus can be. The early beginners can beat the late starters in terms of creating a retirement corpus in the long term.
Rs 4,000 Monthly SIP for 33 years vs Rs 40,000 Monthly SIP for 15 Years: One of the major excuses for starting investment for a common man investor is that 'I don't have sufficient savings a month.' The definition of 'sufficient' can differ from person to person. For someone, it can be Rs 3,000 a month; for others, it can be Rs 5,000; for you, it can be Rs 10,000. But if one gives sufficient time for their investment to grow, no amount is small or big. It can happen because of the power of compounding. See examples below of how amounts of Rs 1,000, Rs 2,000, and Rs 3,000 monthly investments can generate funds worth crores and which can create a higher corpus: Rs 4,000 monthly SIP investment for 33 years or Rs 40,000 monthly SIP investment for 15 years.
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Power of Rs 1,000 monthly SIP
Let's see what Rs 1,000 monthly SIP investment at 12 per cent annualised return can generate in 30 and 40 years.
In 30 years, the expected corpus will be Rs 35,29,914, on investment of Rs 3,60,000.
In 40 years, the expected corpus will balloon to Rs 1,18,82,420 on investing Rs 4,80,000.
Power of Rs 2,000 monthly SIP investment
Let's see what happens when you invest Rs 2,000 monthly for 25 and 35 years and get 12 per cent annualised return.
In 25 years, the expected corpus will be Rs 37,95,270 on investment of Rs 6,00,000.
In 35 years, the expected corpus will jump to Rs 1,29,90,538 on investment of Rs 8,40,000.
Power of Rs 3,000 monthly SIP investment
Here's what Rs 3,000 monthly SIP can generate in 20 and 30 years if the investor gets 14 per cent annualised return.
In 20 years, the expected corpus will be Rs 39,49,039 on investment of Rs 7,20,000.
If the same investor continues the same investment for another 10 years, their expected corpus will increase to Rs 1,66,71,167 on investment of Rs 10,80,000.
Compounding impact
In all 3 examples, we see that extending investment for another 10 years can multiply the expected corpus by many times. This happens because the compound shows more impact as the investment duration increases.
SIP calculations
Here, we will show comparisons between two monthly SIP investment - Rs 4,000 monthly for 33 years and Rs 40,000 monthly for 15 years. The annualised return in each case will be 12 per cent. Here, the noticeable thing is that the monthly investment in the second case is 10 times more than in the first case.
Corpus from Rs 4,000 monthly SIP investment in 20 years
The expected corpus in 20 years will be Rs 39,96,592, whereas the investment will be Rs 9,60,000.
Corpus from Rs 4,000 monthly SIP investment in 30 years
In 30 years, the investment will be Rs 1,41,19,655 on investing Rs 14,40,000.
Corpus from Rs 4,000 monthly SIP investment in 33 years
In 33 years, the expected corpus will jump to Rs 2,03,75,992 on investment of Rs 15,84,000.
Corpus from Rs 40,000 monthly SIP investment in 5 years
See how Rs 40,000 monthly SIP investment will grow step by step in 5, 10, and 15 years.
In 5 years, the expected corpus will be Rs 32,99,455 on investment of Rs 24,00,000.
Corpus from Rs 40,000 monthly SIP investment in 10 years
In 10 years, the expected corpus will grow to Rs 92,93,563 on investing Rs 48,00,000.
Corpus from Rs 40,000 monthly SIP investment in 15 years
In 15 years, the expected corpus will jump to Rs 2,01,83,040 on investment of Rs 72,00,000.
Conclusion: Rs 4,000 monthly SIP for 33 years vs Rs 40,000 monthly SIP for 15 years
Here, we see that at Rs 40,000 monthly investment for 15 years, the amount invested is over Rs 56,00,000 more than the amount invested in Rs 4,000 monthly SIP investment for 33 years, yet the corpus created in the second case is higher than the first case. It's because of power of compounding.