SIP Investment – If you also think that it is necessary to invest lakhs to become a millionaire, then you will be surprised to know that a fund of crores can be created by investing just Rs 5000 per month.
For this, you just need discipline, patience and the right strategy in investing. Because investing in mutual funds through SIP (Systematic Investment Plan) can create such a big fund over time that you can become a millionaire.
Small amount will give big benefit
SIP is a method of investing in mutual funds in which you invest a fixed amount every month. This investment grows slowly and shows the magic of compounding over time. Compounding means that the interest you get on your investment also becomes a part of the next investment and you get interest on that too. In this way, the benefit of compounding keeps increasing in the long term.
Can you become a millionaire by spending ₹5,000 per month?
If a person invests Rs 5000 every month in SIP and gets an average annual return of 12%, then he can easily become a millionaire in 25 years. But for this, it is most important that the investment is continued for a long time and the SIP is not stopped in between. At the same time, fear of market decline can become an obstacle in achieving this goal.
How will your money grow?
Suppose you invest Rs 5000 every month in SIP and increase it by 10% every year and you get an average return of 12%, then a fund of Rs 16.34 lakh will be ready in 10 years. At the same time, a fund of Rs 93.15 lakh will be created in 20 years and Rs 1.96 crore will be ready in 25 years.
That is, with time and discipline, a good fund can be created by investing a small amount of Rs 5000 every month. Although the fluctuations in the stock market affect investments in mutual funds, investing in SIP in the long term generally gives good returns.
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