SIP calculator: Mutual fund investments are subject to market risk but this risk can be minimised by opting the systematic investment plan or SIP. In this investment option, an investor is allowed to choose monthly, quarterly or half-yearly investment option that allows an investor to accumulate whopping amount in long term, even when they don’t have a lump sum amount for upfront one time investment. According to tax and investment experts, one can become a crorepati or accumulate ₹1 crore in 10 years, provided. However, to meet this ambitious investment goal they will have to make things differently though they need not to do anything different than mutual funds SIP.
How to become rich?
On how mutual fund SIP can help can help you become rich in long term, Kartik Jhaveri, Director — Wealth at Transcend Capital said, “Mutual fund SIP is an instrument tool that allows an investor to get average return given by the equity market. It can be started with a minimum amount of ₹500. So, it is suitable for even those who don’t have a whopping lump sum amount for one time investment. Via SIP, a disciplined investor can accumulate big corpus in long term as long term SIP gives compounding benefit to an investor i.e. interest on interest. So, longer is the time, higher will be the compounding benefit.”
On mutual fund return that one can expect in long term, Kartik Jhaveri said, “One can expect at least 12 per cent return on one’s investment in equity mutual funds for long term. However, it may go up to 15 per cent or even more if the time horizon is higher.”
Kartik Jhaveri said that if an investor invests for 15 years or more, one can expect to get 15 per cent or more return on one’s money. However, in the case of less than 15 years but more than 10 years, one can expect to get around 12 per cent mutual funds return.
Mutual fund return calculator
On how to get ₹1 crore maturity amount from SIP investment, Pankaj Mathpal, MD & CEO at Optima Money Managers said, “Genius don’t do different thing, they do things differently. For a smart investor, SIP step up tool is something that can help to accumulate highest possible amount in smallest possible time. In this monthly step up, a mutual fund SIP investor is advised to increase one’s monthly SIP in sync with one’s annual increment or rise in annual income.”
SIP calculator
Mathpal said that normal annual SIP step up suggested is 10 per cent but for such ambitious ₹1 crore investment goal in 10 years, one needs to maintain 15 per cent annual SIP step up. By doing this if an investor starts a monthly SIP of around ₹25,000 per month maintaining annual SIP step up of 15 per cent, then at 12 per cent annual mutual fund return, one will be able to accumulate around ₹1 crore in 10 years.
See SIP calculator below:
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In short, mutual fund investment can make you a crorepati in 10 years by starting a mutual fund monthly SIP of ₹25,000.
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Updated: 10 Jun 2023, 01:20 PM IST