Even with a salary of just ₹20,000, building a corpus of ₹2 crore isn’t impossible. While this may sound daunting in times of inflation, with proper planning and discipline, it’s easily achievable. Financial expert Ankur Warikoo explains in his strategy that even people with limited incomes can build a corpus of crores in 30 years by creating a smart budget and investing regularly. This method is especially beneficial for young people, as small savings made early on can compound over time to create a substantial corpus.

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How to Manage a Full Budget with a Salary of ₹20,000

Even with a monthly income of ₹20,000, they can still save while living in a big city. To do this, it’s important to first control living expenses. If you choose a shared PG or shared flat, the rent can range from ₹7,000 to ₹8,000. Adding electricity, water, and internet costs, this comes to around ₹9,000. Homemade food can be managed for around ₹5,000 to ₹6,000.

Using public transport is the most economical option for commuting, costing ₹1,500 to ₹2,000. Phone bills, internet, and OTT platform services cost around ₹1,200. Setting aside ₹1,500 for daily needs like clothing, personal care, and groceries brings the total monthly expenditure to ₹15,000 to ₹16,000. Ultimately, savings of around ₹4,000 to ₹5,000 can easily be achieved.

How to Develop an Investment Habit

Investing this remaining amount proves extremely beneficial for the future. Approximately ₹4,500 can be invested in equity mutual funds through a SIP every month. These funds have the potential to generate average returns of up to 12% over the long term. Make it a habit to increase your SIP by at least 10% every year if your job increases. A step-up model, starting with ₹4,500 in the first year, ₹4,950 the next year, and then ₹5,445, allows your investment to grow at a steady pace.

This consistent investment over 30 years will result in a total investment of approximately ₹4.5 million to ₹5 million, but compounding can increase this amount to approximately ₹24 million. This is the power of compounding, which, with time and discipline, makes small investments grow.

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The Path to Becoming a Millionaire

If someone starts this journey with a salary of ₹20,000, they can easily become a millionaire by the age of 50. This fund can be used to fulfil important life goals such as buying a house, a car, wedding expenses, children’s education, and retirement planning. The most important thing is regular investment, control of expenses, and review of monthly expenditures. If necessary, it is also beneficial to consult an expert financial advisor. Interested investors can also choose index funds or flexi-cap funds based on their research.