Power of Compounding: How much corpus you can generate with Rs 8,000 monthly SIP investment in 20, 25, 30, and 35 years | See Calculations
Power of Compounding: Whether you're planning for retirement or have other financial goals like buying a house, a car, funding your children's education, or other, strategic planning can help you reach your goals on time and with less worry.
Invest in Mutual Fund SIPs
To build a substantial corpus in the long term, there are many investment options available in the market. However, one of the most popular options is SIP mutual funds. This may be because, with this investment strategy, you can invest monthly, quarterly, biannually, or annually—rather than in a lump sum. Additionally, you can take advantage of the power of compounding, and it has the potential for market growth over time as well.
Still confused? Understand with example
So, if you want to invest your money you can go for mutual fund SIP. Still confused about how this works? Understand with example.
Rs 8,000 monthly SIP: Corpus generation in 20 yrs, 25 yrs, 30 yrs, 35 yrs
Let's suppose you are investing Rs 8,000 every month through a SIP. Now in this write-up, we will try to calculate how much corpus you can generate in 20 yrs, 25 yrs, 30 yrs, and 35 yrs.
SIP Mutual Fund: Assuming 12% annualised return
The growth of your SIP investment depends on the annualised return rate. For the following calculations, we are assuming an average annual return of 12 per cent, which is typical for equity funds over the long term.
Power of Compounding: Your Total Investment and Estimated Capital Gain in 20 Years
If you invest Rs 8,000 monthly for 20 years, your total investment will amount to Rs 19,20,000. With an annualised return of 12 per cent, the estimated capital gain could be around Rs 60,73,183.
Power of Compounding: Total Amount Received After 20 Years
By adding your initial investment to the capital gain, your total corpus could grow to approximately Rs 79,93,183 over 20 years.
Power of Compounding: Your Total Investment and Estimated Capital Gain in 25 Years
In 25 years, your total investment will be Rs 24,00,000. With the same annualised return of 12 per cent, your capital gain could be around Rs 1,27,81,081.
Power of Compounding: Total Amount Received After 25 Years
Adding the initial investment to the capital gain, your total corpus could grow to approximately Rs 1,51,81,081 over 25 years.
Power of Compounding: Your Total Investment and Estimated Capital Gain in 30 Years
If you continue investing for 30 years, your total investment will be Rs 28,80,000. With the same annualised return of 12 per cent, the estimated capital gain could be around Rs 2,53,59,310.
Power of Compounding: Total Amount Received After 30 Years
With the initial investment added to the capital gain, your total corpus could grow to approximately Rs 2,82,39,310 over 30 years.
Power of Compounding: Your Total Investment and Estimated Capital Gain in 35 Years
After 35 years of investing, you will have contributed Rs 33,60,000. With a 12 per cent annualized return, the estimated capital gain could be around Rs 4,86,02,153.
Power of Compounding: Total Amount Received After 35 Years
When you add your initial investment to the capital gain, your total corpus could grow to approximately Rs 5,19,62,153 over 35 years.
Important Points to Remember About SIP Investment
It’s important to understand that SIPs are market-linked investments, meaning that returns are not guaranteed. The 12 per cent return mentioned in the above calculations is an estimate, and actual returns may vary depending on market conditions.