SIP: Making wise investments that will eventually pay off is necessary to secure your future in the current financial environment. These critical years won’t come around very often, so it’s critical to invest your money at the correct time when the Indian economy surges to new heights. One investment that comes to mind with all the good news about the Indian economy is the Systematic Investment Plan (SIP), which enables individuals to consistently deposit small sums of money in mutual funds.
Understanding SIP Returns Over Time
SIPs have the advantage of compounding returns, which can make a lot of money even with small monthly contributions. Let’s look at the potential returns of 17% over different time periods.
| Duration | SIP Amount (₹) | Future Value (₹) |
|---|---|---|
| 5 years | 72,000 | 5.7 Lakhs |
| 8 years | 1,44,000 | 12.3 Lakhs |
| 10 years | 1,80,000 | 18.9 Lakhs |
| 12 years | 2,16,000 | 28.3 Lakhs |
| 15 years | 2,70,000 | 49.7 Lakhs |
| 18 years | 3,24,000 | 85.4 Lakhs |
| 20 years | 3,60,000 | 1.2 Crores |
| 22 years | 3,96,000 | 1.7 Crores |
| 25 years | 4,50,000 | 2.9 Crores |
These numbers highlight the effectiveness of systematic investment using SIP. Over time, the compounding impact can result in significant wealth accumulation even with relatively small initial contributions.
Wealth Creation Example
An estimated sum of Rs. 2,87,98,031 (2.9 Crores) can be obtained by investing Rs. 18,00,000 (18 Lakhs) through SIP over a 25-year period. A boost in wealth of Rs. 2,69,98,031 (2.7 Crores) will result from this scenario. This example demonstrates how systematic investing can gradually increase your initial investment.
Popular Investment Options in India
Let’s see interest rates of some popular small savings schemes in India:
- Sukanya Samriddhi Account Scheme: 8.2%
- Senior Citizen Savings Scheme: 8.2%
- National Savings Certificate (VIII Issue): 7.7%
- Kisan Vikas Patra: 7.5%
- Mahila Samman Savings Certificate: 7.5%
Despite the fact that these schemes offer comparatively steady returns, SIP has a far better potential to create wealth because of its exposure to market-linked returns and the ability to compound over time. Remember that SIP involves market risk.
Disclaimer: (This information is provided solely for informational purposes. It is important to note that investing in the market or a business idea involves market risks. Before investing money as an investor/ owner/ partner, always consult an expert. DNP News Network Private Limited never advises to invest money on stocks or any specific business idea. We will not be liable for any financial losses.)
 and how investing Rs 18 lakh over 25 years can grow your wealth to Rs 2.7 crore.){kind=link}