Power of Compounding: How soon will monthly SIP investments of Rs 12,000, Rs 16,000, and Rs 18,000 reach Rs 6 crore corpus target?
Let’s find out how the power of compounding can help one achieve Rs 6 crore corpus with monthly SIP investments of Rs 12,000, Rs 16,000, or Rs 18,000. Also, check out the investment durations to reach your goal.
The power of compounding is a game-changer for building a sizeable corpus over time. For investors aiming to create a corpus of Rs 6 crore, systematic investment plans (SIPs) can be an effective method. By investing monthly amounts such as Rs 12,000, Rs 16,000, or Rs 18,000, one can gradually achieve this financial target. Factors like the annualised return rate and investment duration play important roles in determining how quickly the goal is reached. In this article, we will explore how soon different SIP amounts can help you achieve a Rs 6 crore corpus target.
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(Disclaimer: Our calculations are projections and not investment advice. Do your due diligence or consult an expert for financial planning)
Power of compounding
The power of compounding can work wonders in mutual fund SIP investment. It is a process to generate earnings not only on the original principal amount but also on the accrued growth.
Systematic Investment Plan (SIP)
A systematic investment plan (SIP) is a process of investing in a mutual fund with a fixed amount, either daily, weekly, monthly, or yearly.
What are the benefits of compounding
Your investment can grow faster
Long-term growth
Reduces risk
Starting early
Every financial journey begins with a single step. Even the smallest investments can grow to a huge amount to help you meet your financial goals.
SIP is suitable for all ages
Investment through systematic investment plan (SIP) can be used to create a corpus for families looking to save for their children’s education or marriage.
For young investors, SIPs offer a great way to achieve short- as well as long-term financial goals.
It can be beneficial for salaried employees who prefer investing a fixed amount every month.
SIP calculation conditions
Target corpus: Rs 6 crore
Monthly investments: Rs 12,000, Rs 16,000, Rs 18,000
Expected annualised return: 12 per cent
How long it will take to build Rs 6 crore retirement corpus with Rs 12,000 monthly investment?
It will take approximately 33 years to achieve the target of Rs 6 crore retirement corpus.
From Rs 12,000 monthly SIP to Rs 6 crore corpus at 12 per cent annualised return
The investment amount during that time will be Rs 47,52,000. The estimated capital gains will be Rs 5,63,75,977 and the estimated retirement corpus will be Rs 6,11,27,977.
How long it will take to build Rs 6 crore retirement corpus with Rs 16,000 monthly investment?
It will take approximately 31 years to achieve the target of Rs 6 crore retirement corpus.
From Rs 16,000 monthly SIP to Rs 6 crore corpus
The investment amount during that time will be Rs 59,52,000. The estimated capital gains will be Rs 5,78,94,472 and the estimated retirement corpus will be Rs 6,38,46,472.
How long it will take to build Rs 6 crore retirement corpus with Rs 18,000 monthly investment?
It will take approximately 30 years to achieve the target of Rs 6 crore retirement corpus.
From Rs 18,000 monthly SIP to Rs 6 crore corpus
The investment amount during that time will be Rs 64,80,000. The estimated capital gains will be Rs 5,70,58,448 and the estimated retirement corpus will be Rs 6,35,38,448.