Magic of Rs 2,000 SIP: Is Rs 2 crore corpus possible with Rs 2,000 monthly investment; understand calculations
A small amount can do wonders. By investing just Rs 2,000 monthly investors can earn a retirement corpus of Rs 2 crore. Learn how early investment in a mutual fund systematic investment plan (SIP) can help you build wealth of approximately Rs 2 crore.
At a young age, we are carefree and barely think of retirement planning. As we grow old, we have a better understanding of the world and we are ready to invest. But the irony is as we grow older income sources and job options are limited along with risk factors, whereas young age marks high-risk appetite and time to earn money. Therefore, learn how investing Rs 2,000 can help build you a corpus of Rs 2 crore through systematic investment plan (SIP) in mutual funds.
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What is SIP?
A systematic investment plan (SIP) is a method of investing in mutual funds by regularly contributing a fixed amount of money at predetermined intervals. The amount you can invest can be as low as Rs 100, and the intervals can be daily, weekly, monthly, or yearly.
How SIP works?
SIP works like a recurring investment, where the amount is auto-debited from your bank account and invested in the mutual fund of your choice. Investors purchase net asset value (NAV) units every month with a fixed amount. The rate of these NAVs can increase or decrease every month. So, you practically purchase different amounts of NAVs every month.
Let us understand how one can get close to generating Rs 2 crore corpus by investing Rs 2,000 monthly in SIP for 10, 20, 30, and 40 years. The annualised SIP return here will be 12 per cent.
Calculation for potential corpus investors can build with Rs 2,000 monthly SIP for 10 years
Investment period: 10 years
Monthly investment: Rs 2,000
Target corpus: Rs 2,00,00,000
If investors invest Rs 2,000 monthly in mutual fund SIP for 10 years, they can accumulate an estimated corpus of Rs 4,64,678.
Calculation for potential corpus investors can build with Rs 2,000 monthly SIP for 20 years
Investment period: 20 years
Monthly investment: Rs 2,000
Target corpus: Rs 2,00,00,000
If investors invest Rs 2,000 monthly in a mutual fund SIP for 20 years, they can accumulate an estimated corpus of Rs 19,98,296
Calculation for potential corpus investors can build with Rs 2,000 monthly SIP for 30 years
Investment period: 30 years
Monthly investment: Rs 2,000
Target corpus: Rs 2,00,00,000
If investors invest Rs 2,000 monthly in a mutual fund SIP for 30 years, they can accumulate an estimated corpus of Rs 70,59,828.
Calculation for potential corpus investors can build with Rs 2,000 monthly SIP for 40 years
Investment period: 40 years
Monthly investment: Rs 2,000
Target corpus: Rs 2,00,00,000
If investors invest Rs 2,000 monthly in a mutual fund SIP for 40 years, they can accumulate an estimated corpus of Rs 2,37,64,840.
How much estimated returns do investors get by investing Rs 2,000 monthly in mutual fund SIP for 10 years?
Invested amount: Rs 2,40,000 (in 10 years)
Estimated returns: Rs 2,24,678
How much estimated returns do investors get by investing Rs 2,000 monthly in mutual fund SIP for 20 years?
Invested amount: Rs 4,80,000 (in 20 years)
Estimated returns: Rs 15,18,296
How much estimated returns do investors get by investing Rs 2,000 monthly in mutual fund SIP for 30 years?
Invested amount: Rs 7,20,000 (in 30 years)
Estimated returns: Rs 63,39,828
How much estimated returns do investors get by investing Rs 2,000 monthly in mutual fund SIP for 40 years?
Invested amount: Rs 9,60,000 (in 40 years)
Estimated returns: Rs 2,37,64,840.