Power of Compounding: How beginning with Rs 50/day savings can help you create Rs 3.2 crore corpus | Know calculations
Are you one of those who dream of becoming a Crorepati but aren’t sure how to invest wisely? If so, here’s a simple yet effective strategy: how beginning with Rs 50/day savings can lead to a wealth of over Rs 3 crores in just a few years. Know with examples and calculations -
How to Become a Crorepati: Becoming a crorepati is a dream for many, and the key to achieving it lies in a wise investment. If you want to become a crorepati, it’s crucial to understand the nuances of investing. With the right approach, you can significantly grow your savings, and the journey to wealth can be completed in just a few years. Know how beginning with Rs 50/day savings can build a corpus of over Rs 3 crore.
Long-Term Investment Strategy
To achieve your goal of becoming a crorepati, a long-term investment strategy may work best. Start by estimating your essential expenses and develop a habit of start saving just Rs 50 a day. But where should you invest these savings?
Where should you invest your savings?
Conduct thorough research to identify promising investment instruments that consistently grow your wealth. One strong option is mutual funds, but it’s crucial to choose the right ones.
Investing in SIP of Equity Mutual Funds
Investment advisors and financial planners often recommend equity mutual funds for those looking to accumulate wealth.
Example
For example, if an investor begins with a Rs 1,500 investment at age 25 and continues to invest regularly for 35 years, the dream of becoming a crorepati is within reach. The Systematic Investment Plan (SIP) in equity mutual funds is particularly beneficial.
How to become a crorepati quickly
Experts suggest that investing in mutual funds for 35 years with an estimated return of 13 per cent can simplify your path to becoming a crorepati. Compounding plays a significant role in this. Over 30 years, you’ll benefit from compound interest along with the fixed 13 per cent returns.
Key strategy to remember
However, there’s a key strategy to remember: the Step-Up SIP. This involves increasing your investment by 10 per cent each year, which will help your savings grow into crores.
How to become a crorepati: Know calculations
Start by investing Rs 50 daily through a SIP, setting a long-term goal for 35 years. Implement a 10 per cent step-up increase every year.
Step-up strategy: Increase investment by Rs 150
If you begin with Rs 1,500, you will increase your investment by Rs 150 in the following year.
Total investment over 30 years
According to a SIP calculator, your total investment over 35 years would amount to Rs 48,78,439, resulting in a long-term capital gain of Rs 2,77,54,612.
Maturity amount after 30 years
After 35 years, your expected total maturity amount could reach Rs 3,26,33,051. So, by leveraging the step-up strategy, you can transform your initial savings into Rs 3.26 crores.