Power of Compounding: Rule of 72, 843; how much return will you get in 8, 10, 15 years if you invest Rs 1 lakh? See calculations

Rule 8:4:3 and Rule 72

• Rule 8:4:3 and Rule 72 are key strategies to simplify mutual fund investments.

• These rules offer quick insights into how your investments can grow over time.

8:4:3 Rule: Visualising Investment Growth

Doubling every 8 years: Invest in a mutual fund with a 12% return.

Next doubling in 4 years:

After the first 8 years, it doubles again in 4 years.

Tripling in the next 3 years

Final doubling in 3 more years.

Key Takeaway

Your investment quadruples in 15 years and grows eightfold in 21 years.

8:4:3 Rule: Grow Your Wealth Exponentially

• After 8 years: Your Rs 1 lakh investment becomes Rs 2 lakh.

• After 12 years: Your Rs 1 lakh grows to Rs 3 lakh.
• After 15 years: Your Rs 1 lakh becomes Rs 4 lakh.

Rule of 72: When Will Your Money Double?

Doubling Time: At 10% interest, your Rs 1 lakh will double to Rs 2 lakh in 7.2 years (72/10).

Importance of Early Investing

• Start early: Rs 5,000 invested monthly at 10% from age 25 grows to over Rs 1 crore by age 60.

• Key Takeaway: Early, consistent investing pays off significantly in the long run.

Recent Mutual Fund Investment Regulations

• Mandatory updates: Include linking PAN and Aadhaar, OTP verifications, and KYC revalidation.

• Objective: Ensure secure and efficient investment processes.

Benefits of the 8:4:3 Rule

• Disciplined Investing: Encourages consistency, avoiding emotional market decisions.

• Inflation Alignment: Helps safeguard investments from inflation (4% annually).
• Portfolio Management: Promotes regular reviews to minimise risks and maximise gains.

Disclaimer

The content is for informational purposes only and does not constitute financial advice. Always consult a professional before making investment decisions.