Power of Compounding: At 12% expected annualised return, how soon can Rs 8,000, Rs 9,000, Rs 10,000 monthly SIPs build Rs 5 crore corpus?
By investing Rs 8,000, Rs 9,000, or Rs 10,000 every month through a Systematic Investment Plan (SIP), you could grow your investment to Rs 5 crore in the long duration. It’s possible with consistent, disciplined investments and the power of compounding. SIPs allow anyone, regardless of age or income, to work towards long-term financial goals, whether it’s for retirement or other goals, without putting too much pressure on their monthly budget. Let’s break down how this works and how small, regular investments can make a big difference in the future.
Many people think that building a large retirement corpus requires big investments, so they overlook the importance of small, regular savings. While investing more can help money grow faster, many delay or avoid investing because of budget concerns. The truth is, that starting early can make all the difference. In this article, we’ll explore how small monthly investments of Rs 8,000, Rs 9,000, or Rs 10,000 through a Systematic Investment Plan (SIP) can grow over a long duration and help you work towards a comfortable retirement. Let’s understand why even small steps taken early can lead to big results.
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(Disclaimer: Our calculations are projections and not investment advice. Do your due diligence or consult an expert for financial planning)
What is power of compounding?
The sooner you start investing, the better it is. Starting early gives you more time to see the benefits of compounding, which helps your money grow faster as time passes by. Even small, regular investments can gradually turn into a large amount. Compounding plays a key role in building a sizeable corpus, especially for retirement savings, investments, and other long-term financial goals. It’s one of the most powerful tools to grow your money steadily over the years.
Starting early is the key
Every financial journey starts with a small step. Even tiny investments can grow into large amounts over a long duration, helping you achieve your financial goals. That’s why it’s important to start investing early. With SIPs, you can begin investing with as little as Rs 100 a month.
What is Systematic Investment Plan?
SIP is a process of investing in a mutual fund with a fixed amount, either daily, weekly, monthly, or yearly.
Benefits of SIP?
Flexible Investment
Long term growth
Convenient
Benefits of Compounding
Encourages early start
Suitable for goals
No extra efforts
Ideal for long-term goals
SIP inculcates a disciplined saving habit, which is essential for achieving long-term financial goals. It can be useful to align with specific long-term goals.
Minimal impact on monthly budget
SIP minimises financial pressure on investors and also helps to save for large expenses and financial goals.
Small investments, big returns in long duration
With compounding, small and consistent investments can grow into a sizeable corpus over the years, making it perfect for long-term goals like retirement.
Impact of consistent investments
Consistent investing, through SIPs, ensures your money grows steadily.
How long it will take to achieve Rsx 5 crore corpus with Rs 8,000 monthly SIP?
It will take approximately 35 years to achieve the target of Rs 5 crore retirement corpus.
From Rs 8,000 monthly SIP to Rs 5 crore corpus at 12 per cent annualised return
During that time, the investment amount will be Rs 33,60,000. The estimated capital gains will be Rs 4,86,02,153 and the estimated retirement corpus will be Rs 5,19,62,153.
How long it will take to achieve Rsx 5 crore corpus with Rs 9,000 monthly SIP?
It will approximately take 34 years to achieve the target of Rs 5 crore corpus.
From Rs 9,000 monthly SIP to Rs 5 crore corpus
During that time, the investment amount will be Rs 36,72,000. The estimated capital gains will be Rs 4,81,03,685 and the estimated retirement corpus will be Rs 5,17,75,685.
How long it will take to achieve Rsx 5 crore corpus with Rs 10,000 monthly SIP?
It will approximately take 33 years to achieve the target of Rs 5 crore corpus.
From Rs 10,000 monthly SIP to Rs 5 crore corpus
The investment amount will be Rs 39,60,000. The estimated capital gains will be Rs 4,69,79,981 and the estimated retirement corpus will be Rs 5,09,39,981.