Mutual Fund SIP Calculator: Systematic Investment Plan (SIP) is an attractive investment option offered by mutual funds that allows an investor to invest a fixed amount in a mutual fund scheme at regular intervals. In this investment route an investor can invest once in a month or once in a quarter instead of investing the lump sum amount at one go. It enables an investor to grow a large amount for medium term investment goals like higher studies of the child, dream vacation, relaxation etc. Therefore, even if an earning person lacks a lump sum amount for lump sum investment, he can deposit the money to meet his mid-term investment goals where an individual would need approx. 50 lakhs for meeting such targets.
Now the question is how to deposit 50 lakhs in mid term or say in 10 years? According to tax and investment experts, investment should increase with increase in income. So, the annual step-up in mutual funds SIP is a good option to start investing with minimum monthly investment.
speaking on Whether the investment target of 50 lakhs can be achieved in 10 years; Sebi registered tax and investment expert Jitendra Solanki said, The investment target of 50 lakhs in 10 years is a bit ambitious and would require investment discipline from the investor like to continue the monthly SIP without fail under any circumstances. Further, the investor should increase his/her monthly SIP using annual step-up. This will enable an investor to get started with a minimal monthly SIP amount.
How much annual step would be enough to accomplish this 50 lakhs in 10 years investment target; Karthik Jhaveri, director of wealth at Transcend Capital, said, “The usual practice is a 10 per cent annual step up in monthly SIPs. However, to meet such requirements, The ambitious target of 50 lakhs in 10 years, annual SIP step-up should be kept at 15 per cent.
On what returns one can expect after investing in mutual fund SIPs for 10 years, both the experts said that around 12 per cent returns can be expected after investing for 10 years.
mutual fund calculator
Assuming 15% annual step-up and 12% return if a person wants to deposit 50 lakhs in 10 years, then mutual fund return calculator or mutual fund SIP calculator shows that one needs to start mutual fund SIP 12,500 per month investment.
see full image
However, if a person cannot invest 12,500 per month, in which case he has the option of keeping the annual step-up at a little over 20 per cent. In that case, starting a mutual fund SIP 10,500 monthly investment will enable the investor to meet his needs 50 lakh investment target in 10 years
see full image
Mutual fund SIP schemes that can give 12 per cent returns in 10 years; Vineet Khandare, CEO and Founder, MyFundBazaar India Private Limited, listed the following SIP plans:
Small-Cap Fund: SBI Small Cap Fund – Regular Growth.
Mid Cap Fund: Aditya Birla Sun Life Mid Fund – Plan – Growth Regular Plan.
Large-Cap Fund: HDFC Top 100 Fund – Regular Plan – Growth.
Never miss a story! Stay connected and informed with Mint.
download
Our App Now!!