We talked about how a little Rs 6,000 investment might enable you to accumulate a substantial corpus of more than Rs 5 crore.  Let's examine the key elements that contribute to creating such a vast corpus.
 
Initially, we are discussing the monthly investment of Rs 6,000 in a Systematic Investment Plan (SIP). The definition of a SIP will become clearer to you as you read this text. Another element crucial to your money's long-term growth is the power of compounding. All you need to do is consistently make investments. Let's see how a modest monthly investment of Rs 6,000 might grow into a substantial corpus of Rs 5 crore.

What is SIP?
An investment strategy that allows investors to invest a set amount in mutual funds is known as a systematic investment plan.  Depending on their preferences, investors can make daily, weekly, monthly, quarterly, or annual investments.
 
Why choose SIP?
 
SIP is easy to use for beginners; with just a regular investment of Rs 100, new investors can begin the process of accumulating a sizable corpus.  Additionally, it is easy because you don't have to worry about losing out on investments thanks to automated deductions.
 
Why should you begin investing at a young age?
 
One should begin investing early in order to receive the greatest long-term profits.  Let's look at an example to better comprehend it.
 
Example of early investment

Investor A: Starts investing Rs 5,000/month at age 25 and continues till age 45 (20 years).
Total Investment: Rs 12,00,000
Maturity Amount (at 12% annual return): Rs 50,00,000

Investor B: Starts investing Rs 5,000/month at age 35 and continues till age 55 (20 years).
Total Investment: Rs 12,00,000
Maturity Amount (at 12% annual return): Rs 28,00,000

By starting 10 years earlier, Investor A earns ₹22,00,000 more, showcasing the power of compounding.

SIP calculations

Target corpus: Rs 5 crore
Monthly investment: Rs 6,000
Annualised return: 12 per cent
How long it will take to build over Rs 5 crore with Rs 6,000 monthly SIP

It will take approximately 40 years to generate over Rs 5 crore.

How much can Rs 6,000 monthly SIP build in 10 years?

The investment amount will be Rs 7,20,000, the capital gains will be Rs 6,24,215, and the estimated retirement corpus will be Rs 13,44,215.

How much can Rs 6,000 monthly SIP build in 20 years?

The investment amount will be Rs 14,40,000, the capital gains will be Rs 40,79,144, and the estimated retirement corpus will be Rs 55,19,144.

How much can Rs 6,000 monthly SIP build in 30 years?

The investment amount will be Rs 21,60,000, the capital gains will be Rs 1,63,25,839, and the estimated retirement corpus will be Rs 1,84,85,839.

How much can Rs 6,000 monthly SIP build in 40 years?

The investment amount will be Rs 28,80,000, the capital gains will be Rs 5,58,78,426, and the estimated retirement corpus will be Rs 5,87,58,426.

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17/03/2025 08:19 AM