Retirement Planning: How much to invest monthly in SIP to retire early with Rs 5 crore at 55?
Starting early can help people build their target corpus faster, making it easier to reach their financial goals sooner. Planning for retirement is an important part of this. For example, if someone invests Rs 15,000 every month in a Systematic Investment Plan (SIP), they could aim to reach a retirement fund of Rs 5 crore. Let’s figure out how long it would take for them to achieve this goal.
Planning for retirement is important to ensure financial independence and a comfortable life after you stop working. Having a clear goal, like saving Rs 5 crore, helps you stay focused and disciplined in your savings and investments. Starting early and saving consistently is key to taking advantage of the power of compounding. Your money grows faster the earlier you begin. In this article, we’ll explore how a monthly SIP of Rs 15,000 can help you reach your goal of Rs 5 crore for retirement.
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(Disclaimer: Our calculations are projections and not investment advice. Do your due diligence or consult an expert for financial planning)
What is retirement planning?
Retirement is an important stage in life, and it’s crucial to plan for it early so that you don’t have to depend on others for financial support. Retirement planning is the process of getting ready for a comfortable life once you’ve finished working, whether it’s a job or a business.
When should you start retirement planning?
There’s no perfect time to start planning for retirement, as your financial situation changes at different points in life. However, starting early can help your savings grow over time thanks to the power of compounding, making it easier to reach your retirement goals.
Why is retirement planning important?
Planning a retirement is important to maintain a standard of living and to avoid depending on others for financial support.
Retirement planning through mutual fund SIP
Investors can plan a retirement by investing through a systematic investment plan (SIP) in a mutual fund(s) scheme, which will let them build wealth over time.
Steps to plan your retirement
Set retirement goals
Access your financial situation
Choose a suitable retirement plan
How much should one invest monthly in SIP to retire early with Rs 5 crore corpus?
One should invest Rs 15,000 in monthly SIP to build a retirement corpus of Rs 5 crore till the age of 55.
How soon you can achieve Rs 5 crore retirement corpus at 12 per cent annualised return with Rs 15,000 monthly SIP?
If you start investing at the age of 25, it will approximately take 30 years for investors to build a retirement corpus of Rs 5 crore with a monthly SIP of Rs 15,000.
What will be your retirement corpus in 10 years with 12 per cent annualised return?
In 10 years, the investment amount during that time will be Rs 18,00,000. The estimated capital gains will be Rs 16,85,086, and the estimated retirement corpus will be Rs 34,85,086.
What will be your retirement corpus in 20 years?
The invested amount during that period will be Rs 36,00,000. The estimated capital gains will be Rs 1,13,87,219, and the estimated retirement corpus will be Rs 1,49,87,219.
What will be your retirement corpus in 30 years?
The estimated retirement corpus will be Rs 5,29,48,707. During that time, the invested amount will be Rs 54,00,000, and the estimated capital gains will be Rs 4,75,48,707.