Power of Rs 8,000 SIP: Can you build a corpus of Rs 8 crore with just Rs 8,000 monthly investment?
SIP is a popular investment option that can help people build a large retirement corpus. Even a small amount can make a big difference. The secret lies in investing early and staying consistent. The power of association plays a major role, motivating people to create goals and then work towards achieving them. Similarly, if you invest Rs 8,000 in a monthly systematic investment plan (SIP) you can generate a retirement corpus of Rs 8 crore. Let’s understand it by counting.
What is SIP in mutual fund?
A systematic investment plan (SIP) is a process of investing a fixed amount in mutual funds. You can invest daily, weekly, monthly, quarterly, or annually, depending on the investor’s choice.
Why should one invest in mutual fund SIP?
SIP is suitable for beginners, by investing even a small amount every time, first time investors can start their journey to build a huge corpus.
Why should one start investing early?
If you start early your money has time to grow. Let’s understand it with a figure.
Investing early
- Investor A: He starts investing Rs 5,000 per month at the age of 25 and continues till the age of 45 (20 years).
- Total Investment: Rs 12,00,000
- Growth Rate (at 12 percent return per annum): Rs 50,00,000
- Investor B: Starts investing Rs 5,000 per month at age 35 and continues till age 55 (20 years).
- Total Investment: Rs 12,00,000
- Growth Rate (at 12 percent return per annum): Rs 28,00,000
Starting 10 years earlier, Investor A earns Rs 22,00,000 more, showing the power of compounding.
SIP: Accounting status
- Target corpus: Rs 8 crore
- Monthly investment: Rs 8,000
- Annual return: 12 percent
How long will it take to build a corpus of Rs 8 crore
It will probably take 39 years to make Rs 8 crore.
How much Rs 8,000 monthly SIP can build up in 10 years?
The investment will be Rs 9,60,000, the maximum benefit will be Rs 8,98,713, and the estimated retirement corpus will be Rs 18,58,713.
How much Rs 8,000 monthly SIP can build up in 20 years?
The investment will be Rs 19,20,000, the maximum benefit will be Rs 60,73,183, and the estimated retirement corpus will be Rs 79,93,183.
How much can a monthly SIP of Rs 8,000 generate in 30 years?
The investment will be Rs 28,80,000, the capital gain will be Rs 2,53,59,310, and the estimated retirement corpus will be Rs 2,82,39,310.
How much can Rs 8,000 monthly SIP generate in 39 years?
The investment will be Rs 37,44,000, the capital gain will be Rs 8,05,25,416, and the estimated retirement corpus will be Rs 8,42,69,416.
(Disclaimer: Our calculations are guesswork and not investment advice. Do your best or consult an expert for financial planning)
