Power of Rs 3,000 SIP: In how many years, Rs 3,000 monthly investment can generate corpuses of Rs 2 crore and Rs 3 crore? Know here
Power of Rs 3,000 SIP: A Rs 3,000 monthly SIP amount may not appear to be a large amount, but if it is invested consistently, it can create a corpus of over 3 crore. But in how many years?
Power of Rs 3,000 SIP: One should never underestimate the power of an investment, however small it may be. The key to generating a large corpus is not to put in a large amount for a few years, but it can be built with a small amount invested consistently over a long period of time. Even a Rs 1,000 SIP can generate a Rs 1 crore corpus. Likewise, a Rs 3,000 monthly SIP investment can generate a corpus of Rs 3 crore because of the power of compounding. But any guess how many years it may take?
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(Disclaimer: This is not investment advice. Do your own due diligence or consult an expert for financial planning.)
What Rs 500 and Rs 1,000 monthly SIPs can do
Before we move ahead, let's see what Rs 500 and Rs 1,000 monthly SIPs can do
If we invest a Rs 500 monthly SIP for 10 years and get a 12 per cent annualised return, it can generate an estimated corpus of Rs 1,16,170 on an investment of Rs 60,000.
But if we continue the same investment for another 30 years, in 40 years, the estimated corpus will swell to Rs 59,41,210 on an investment of just 2,40,000.
What Rs 500 and Rs 1,000 monthly SIPs can do
So, a Rs 500 monthly SIP investment can lead us to a Rs 60 lakh corpus because of the long-term, exponential compound growth of our investment.
From Rs 1,000 monthly SIP investment to Rs 1.19 crore corpus
Now, let's see how a Rs 1,000 monthly SIP investment can grow in 10, 20, 30, and 40 years at an annualised return of 12 per cent.
Corpus from Rs 1,000 monthly SIP investment in 10 years
In 10 years, the investment will be Rs 1,20,000, and the estimated corpus will be Rs 2,32,339.
Corpus from Rs 1,000 monthly SIP investment in 20 years
In 20 years, the investment will be Rs 2,40,000, and the estimated corpus will be Rs 9,99,148.
Corpus from Rs 1,000 monthly SIP investment in 30 years
In 30 years, the investment will be Rs 3,60,000, and the estimated corpus will be Rs 35,29,914.
Corpus from Rs 1,000 monthly SIP investment in 40 years
In 40 years, the investment will be Rs 4,80,000, and the estimated corpus will be Rs 1,18,82,420.
From 30 to 40 years, the estimated corpus grew by Rs 83,52,506 on an extra investment of just Rs 1,20,000.
Now, let's see what a Rs 3,000 monthly SIP can do in different durations.
Calculation for our story
We will take the example of a Rs 3,000 monthly investment and will show its impact in the long run. The target retirement corpus amount is Rs 3 crore and the rate of annualised return is 12 per cent.
Corpus from Rs 3,000 monthly SIP investment in 10 years
In 10 years, the investment will be Rs 3,60,000, and the estimated corpus will be Rs 6,97,017.
Corpus from Rs 3,000 monthly SIP investment in 20 years
In 20 years, the total investment will grow to Rs 7,20,000, but the estimated corpus will soar to Rs 29,97,444.
Corpus from Rs 3,000 monthly SIP investment in 30 years
In 30 years, the total investment will be Rs 10,80,000, but the estimated corpus will skyrocket to Rs 1,05,89,741.
From Rs 3,000 monthly SIP investment to Rs 2 crore corpus
A Rs 2 crore corpus can be generated in a little over 35 years.
In 36 years, the investment will be Rs 12,96,000, and the estimated corpus will be Rs 2,19,95,523.
From Rs 3,000 monthly SIP investment to Rs 3 crore corpus
It will take 39 years to reach the target of an estimated Rs 3 crore corpus.
The investment will be Rs 14,04,000, and the estimated corpus will be Rs 3,16,01,031.
Impact of higher return
But in compounding, return on investment plays a key role in determining the corpus, specially in the long run.
If the investor gets 14 per cent annualised growth instead of 12 per cent, the same Rs 3,000 monthly SIP investment can grow to an estimated Rs 5,89,96,105 in 39 years.