What should you always keep in mind while investing? Only a smart person talks about inflation. You don’t need to be a financial advisor to understand this calculation! The price of things does not decrease over time; instead, it increases at a steady rate. Therefore, investments should be made in a way that ensures your money grows every year. This is possible only if the interest is compounded. No doubt, the Systematic Investment Plan (SIP) in mutual funds offers this opportunity. Now, let’s see how much return can be obtained if someone invests ₹2,000 every month in a mutual fund SIP for 10 years continuously.

Why SIP Investment in Mutual Funds Is Gaining Popularity

Investment in mutual funds through SIP is becoming more and more popular every day. Many people now invest in SIP every month. However, since mutual funds are linked to the stock market, guaranteed returns cannot be expected. Statistics from the last few years show that investors have received an average return of 12 percent in SIPs.

High Returns in Recent Years

In 2023, the return from most equity funds was more than 50 percent. While it is not guaranteed that the same return will continue in the future, many mutual funds have delivered returns of over 40 percent in the past few years.

Start with Just Rs. 500

You can start an SIP with just Rs. 500. If you invest regularly, you could potentially accumulate crores of rupees over the long term. Most mutual funds require a minimum investment of Rs. 500 to start. However, you can increase the investment amount if you wish.

How Much Can You Earn by Investing Rs. 2,000 Monthly for 10 Years?

Let’s see how much return you can earn by investing Rs. 2,000 every month in a mutual fund SIP for 10 years. If you deposit Rs. 2,000 every month, you can receive Rs. 4,64,678 at the time of maturity after 10 years. Let’s break down the calculations:

Total Investment: Over 10 years, you will invest Rs. 2,40,000 (Rs. 2,000/month).

Total Return: You could earn Rs. 2,24,678 in interest over the 10 years.

What Happens If You Invest More?

If you deposit Rs. 3,000 every month in a mutual fund SIP, you could receive Rs. 6,97,017 at maturity after 10 years. This shows that with higher investment, the return can be significantly larger.

Conclusion: Long-Term Benefits of SIP

In the long term, SIP investments can generate large returns. Whether you start with Rs. 500 or Rs. 3,000 monthly, mutual fund SIPs provide a great opportunity for wealth creation over time.