Retirement Goals: Can you generate Rs 3.5 crore retirement corpus with monthly SIP of just Rs 3,000? Check details inside
SIPs enable investors to acquire units at a reduced average cost per unit. When the market rises, investors buy fewer units; when it falls, they buy more.
SIP, or Systematic Investment Plan, is a way of investing in mutual funds that involves depositing a specified amount of money regularly. You may start a SIP at any age, with any sum of more than Rs 500.
What is SIP?
SIPs are a disciplined approach to investing that can help people accumulate wealth over time.
Benefits of SIP
There are several benefits to investing in mutual funds. These include:
Compounding Interest
The interest received on the principal amount is reinvested, potentially yielding bigger returns.
Rupee cost averaging
SIPs enable investors to acquire units at a reduced average cost per unit. When the market rises, investors buy fewer units; when it falls, they buy more.
Avoids market timing
SIPs allow investors to make recurring investments without worrying about market swings.
How does compounding impact investment returns?
Compounding increases your investment returns over time and promotes faster development. It generates larger profits and promotes investment growth over time. The initial deposits compound over time to form a considerable corpus. The longer you invest, the more you may profit from the power of compounding.
Flexibility in SIP
However, SIP investment makes you a regular investor but if you are going through some financial issues, you can adjust the amount as per your budget.
Know how much funds you can accumulate if you start SIP of Rs 3,000 at 20
Suppose you start investing Rs 3,000 per month at 20 age and do this till 60. This way, you can accumulate Rs 3,56,47,261. This includes Rs 14,40,000 invested and estimated returns (12% per annum) of Rs 3,42,07,261 on your investment.
Know how much funds you can accumulate if you start SIP of Rs 3,000 at 25
Suppose you start investing Rs 3,000 per month at 25 age and do this till 60. This way, you can accumulate Rs 1,94,85,807. This includes Rs 12,60,000 invested amount and estimated returns (12% per annum) of Rs 1,82,25,807 on your investment.
Know how much funds you can accumulate if you start SIP of Rs 3,000 at 30
Suppose you start investing Rs 3,000 per month at 30 age and do this till 60. This way, you can accumulate Rs 1,05,89,741. This includes Rs 10,80,000 invested amount and estimated returns (12% per annum) of Rs 95,09,741 on your investment.
Know how much funds you can accumulate if you start SIP of Rs 3,000 at 35
Suppose you start investing Rs 3,000 per month at 35 age and do this till 60. This way, you can accumulate Rs 56,92,905. This includes Rs 9,00,000 invested amount and estimated returns (12% per annum) of Rs 47,92,905 on your investment.