Do you also believe that becoming a millionaire is only a game for those who earn more money? If yes, then you are wrong. In today’s time, you have a powerful scheme like a mutual fund. In this, you can invest your monthly savings through SIP, i.e., Systematic Investment Plan.
This small monthly saving can turn into a fund of crores in the long run. The average return of SIP is considered to be 12%, which is much higher than any other scheme in today’s time. Let us know how big a fund can be created in 15 to 25 years if you start a SIP of ₹ 5,000 to ₹ 20,000 every month.
How to become a millionaire through SIP
If you invest your monthly savings in the right place, the power of compounding increases your money manifold.
₹5,000 SIP
If you invest just ₹5,000 every month, at a rate of 12%:
In 15 years, your fund will grow to ₹23,79,657.
In 20 years, it will grow to ₹45,99,287.
In 25 years, you will create a huge fund of ₹85,11,033.
₹10,000 SIP
By doubling your savings with a SIP of ₹10,000 every month:
In 15 years, you will have a fund of ₹47,59,314.
In 20 years, it will grow to ₹91,98,574.
In 25 years, you will accumulate a fund of over ₹1.70 crore.
₹15,000 SIP
If you put in a little more effort and invest ₹15,000 every month, it can lay a strong foundation for your retirement:
In 15 years, you will build a corpus of ₹71,38,971.
In 20 years, it will grow to ₹1.37 crore.
In 25 years, you will have a corpus of over ₹2.55 crore.
₹20,000 SIP
Those who can save a large chunk of their income can build a massive corpus by investing ₹20,000 every month:
In 15 years, your corpus will grow to ₹95,18,628.
In 20 years, it will grow to ₹1.83 crore.
In 25 years, you will build a corpus of over ₹3.40 crore.
The easiest way to start a SIP
You can easily start your SIP with the help of any trusted mutual fund company website, a certified financial advisor, or a trusted mobile app.
Is a 12% return guaranteed
No, returns in equity mutual funds depend on market risks and are not guaranteed. However, historically, good and diversified equity funds have given an average return of 12% or more over a long period of time, like 15, 20, or 25 years.
How much tax will be levied on the investment
If you sell your investment in equity mutual funds after 1 year, then your profits are taxed as Term Capital Gains (LTCG). Profits up to ₹1 lakh in a financial year are tax-free, and profits above that are taxed at 10%.