Can you build Rs 2.50 crore corpus through Rs 150/day savings? Get calculations with examples
Retirement Planning: The earlier you start investing, the higher your retirement corpus can be. E.g., if you invest Rs 2,000 a month through SIP in a mutual fund scheme and get a 12 per cent annualised return on it, in 10 years, you will build just a Rs 4.5 lakh estimated corpus on a Rs 2.40 lakh investment, but if you continue it for another 20 years and get the same return, your estimated corpus will grow to Rs 61,61,946, while your investment will be just 7.20 lakh.
Retirement Planning: Saving and investing are two important aspects that, if used patiently and wisely, can take your wealth to the next level. Even if your savings are not much, if you invest them constantly, in the long run, your monthly investment can help you build a retirement corpus running into crores of rupees. The earlier you start investing, the higher your retirement corpus can be. E.g., if you invest Rs 2,000 a month through SIP in a mutual fund scheme and get a 12 per cent annualised return on it, in 10 years, you will build just a Rs 4.5 lakh estimated corpus on a Rs 2.40 lakh investment, but if you continue it for another 20 years and get the same return, your estimated corpus will grow to Rs 61,61,946, while your investment will be just 7.20 lakh. In this write-up, we will tell you how your saving of just Rs 150 a day can help you build a Rs 2.50 crore retirement corpus in the long run.
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(Disclaimer: This article is not investment advice. It is for knowledge purpose only. Do your own due diligence or consult an advisor before retirement planning.)
What Rs 150/day saving will lead to in 1 year
If you save Rs 150 per day, in 365 days, or a year, your saving will be Rs 54,750.
What will be your monthly investment?
If your yearly saving is Rs 54,750 in a year, your monthly investment will be Rs 4,562.5.
SIP investment
You may invest that amount through SIP in a mutual fund scheme(s). SIP investment in the long run can give steady returns.
SIP annualised return
We assume that SIP investment will give 12 per cent annualised return on your investment.
What can be the starting investment age?
If one starts at 25 years of age and invests till Rs 60 years of age, they will have 35 years of investment horizon.
What will be the retirement corpus after 35 years?
With a Rs 4,562.5 SIP investment per month, your investment in 35 years will be Rs 19,16,040, the estimated long-term capital gains will be Rs 2,32,24,372, and the expected amount will be Rs 2,51,40,412.
What if you invest for 30 years?
In 30 years, your investment will be Rs 16,42,320, and your estimated retirement corpus will be Rs 1,40,55,400.
What if you invest for 25 years?
If your investment horizon is 25 years, your investment will be Rs 13,68,600, and the estimated corpus will be Rs 77,65,466.
What if you invest for 20 years?
If you invest for 20 years, your investment will be Rs 10,94,880, and the estimated retirement corpus will be Rs 41,96,389. So, we see that the early starter will have an edge.