SIP Investment Strategy: How many years it will take to generate Rs 2 crore corpus with Rs 5,000, Rs 10,000 and Rs 15,000 monthly SIP
Power of Compounding: For a long-term disciplined investment, people mostly opt for Systematic investment plans (SIPs). It is a method of investing in mutual funds wherein an investor chooses a mutual fund scheme and invests the fixed amount of his/her choice at fixed intervals.
SIP: Power of Compounding
SIPs come with a monthly compounding benefit, meaning that the return earned each month is added to the principal. This new total is then used to calculate the return for the next period.
Rs 5,000, Rs 10,000 and Rs 15,000 monthly SIP
So, given the ability of the instrument to help you in your investment journey and help build you wealth, here is a take on how Rs 5,000, Rs 10,000, and Rs 15,000 monthly SIP can help you attain a corpus of Rs 2 crore.
Starts investing early
But herein we have assumed that investors start their investment journey early in life and attain the retirement corpus by the retirement age of 60 years.
Rs 5,000 monthly SIP (assuming 13 per cent annualised return)
The investor will take 30 years to compound his/her monthly SIP investment of Rs 5000 to around Rs 2,21,03,234.
Rs 5,000 monthly SIP: Total investment and return in 30 years
According to a SIP calculator, the total investment in 30 years would amount to Rs 18,00,000, resulting in a long-term capital gain of Rs 2,03,03,234.
Rs 10,000 monthly SIP (assuming 13 per cent annualised return)
Similarly, Rs 10,000 monthly SIP will compound to Rs 2,27,14,350 in a matter of 25 years.
Rs 10,000 monthly SIP: Total investment and return in 25 years
According to a SIP calculator, the total investment in 25 years would amount to Rs 30,00,000, resulting in a long-term capital gain of Rs 1,97,14,350.
Rs 15,000 monthly SIP (assuming 13 per cent annualised return)
With a monthly SIP of Rs 15,000, investors will be able to build more wealth than before in just 22 years. His/her investment increased to approximately Rs 2,26,66,787.
Rs 15,000 monthly SIP: Total investment and return in 22 years
According to a SIP calculator, the total investment in 22 years would amount to Rs 39,60,000, resulting in a long-term capital gain of Rs 1,87,06,787.
Financial corpus
So, one can gain bountifully even with small SIPs parked at judiciously and in a disciplined way. One can also top-up his SIP amount with increasing income for an early attainment of the financial corpus.