Retirement Planning: Monthly savings Rs 15,000; how soon can one achieve Rs 5 crore corpus goal?
Starting early can help individuals grow their corpus faster which may later help them achieve their financial goals at an early stage. Planning for retirement is also a part of it. Thus, if an individual’s monthly savings are Rs 15,000, they can achieve estimated Rs 5 crore retirement corpus goal. Here, we will understand how many years it will take for an individual to achieve this target.
Retirement planning is essential for securing financial independence and having a comfortable post-retirement life. A well-defined goal, such as building Rs 5 crore corpus, provides a clear target for a disciplined individual, who can achieve it through savings and investing. Similarly, starting early and staying consistent play an important role in the power of compounding. The earlier you start, the more time your money has to grow. Keeping this in mind, we will discuss how a monthly savings of Rs 15,000 can help an individual achieve Rs 5 crore retirement corpus goal.
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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 phase of life and it is necessary to prepare and plan for it early to avoid financial dependence on others. It is a process in which an individual prepares for a good life after they are done with their job or a business.
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. Nobody can predict what is going to happen tomorrow. In such situations, it is best to stay ahead of time, and retirement planning allows you to do exactly that.
When should one start retirement planning?
There is no ideal time to start with retirement planning. At different stages in life, your financial profile may look different. But starting early can help your wealth grow over time with the effect of the power of compounding.
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. They can invest a fixed amount at regular intervals such as daily, weekly, monthly, half-yearly, or yearly.
Benefits of retirement planning
Financial security
Peace of mind
Regular income after retirement
Steps to plan your retirement
Set retirement goals
Access your financial situation
Choose a suitable retirement plan
How soon can one 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.
How much will be the retirement corpus in 10 years with 12 per cent annualised return?
In 10 years, the investment amount through the monthly SIP 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.
How much will be retirement corpus in 20 years?
The invested amount during this period will be Rs 36,00,000, estimated capital gains will be Rs 1,13,87,219, and the estimated retirement corpus will be Rs 1,49,87,219.
How much will be retirement corpus in 30 years?
The magic of compounding will be more clear in 30 years as the invested amount will be Rs 54,00,000, estimated capital gains will be Rs 4,75,48,707, and the estimated retirement corpus will be Rs 5,29,48,707.