SIP: Do you want to make wise decisions with your hard-earned money and see it accumulate a sizeable sum over time? Systematic Investment Plans (SIPs) are the option. SIPs provide a methodical approach to invest in mutual funds enabling you to progressively accumulate money over time. We’ll go into the specifics of SIP investing in this post, examining the possible returns over various time periods and contrasting them with other well-liked investment choices available to Indian nationals.
Understanding SIP Returns Over Various Durations
The idea of SIPs is to make regular contributions over time, which helps to average the cost of purchase and lessen the effects of market volatility. Assuming an anticipated annual return of 17%, let’s examine the possible returns from SIP investments across a range of time periods:
| Duration | SIP Amount (₹) | Future Value (₹) |
|---|---|---|
| 5 years | 3000 | 2.8 Lakhs |
| 8 years | 3000 | 6.1 Lakhs |
| 10 years | 3000 | 9.5 Lakhs |
| 12 years | 3000 | 14.1 Lakhs |
| 15 years | 3000 | 24.9 Lakhs |
| 18 years | 3000 | 42.7 Lakhs |
| 20 years | 3000 | 60.7 Lakhs |
| 22 years | 3000 | 85.9 Lakhs |
| 25 years | 3000 | 1.4 Crores |
| 28 years | 3000 | 2.4 Crores |
| 30 years | 3000 | 3.4 Crores |
The table illustrates that the potential profits increase with the duration of the SIP investment. For example, assuming an estimated annual return of 17%, you may possibly acquire roughly ₹1.4 Crores if you invest ₹3000 every month for 25 years. In the same way, investing for thirty years can result in a sizeable profit of ₹3.4 crores.
Understanding Wealth Gain
Let’s examine a specific example to further examine the numbers: if you invest Rs. 1080000 (10.8 Lakhs) over time and it increases to Rs. 33772992 (3.4 Crores), you would acquire Rs. 32692992 (3.3 Crores) in wealth.
Comparing SIP with Other Popular Investment Options
Now, let’s compare SIPs with other popular investment options available to Indian citizens:
| Small Savings Scheme | Interest Rate (%) |
|---|---|
| Sukanya Samriddhi Account Scheme | 8.2% |
| Senior Citizen Savings Scheme | 8.2% |
| National Savings Certificate | 7.7% |
| Kisan Vikas Patra | 7.5% |
| Mahila Samman Savings Certificate | 7.5% |
SIPs provide an opportunity of potentially earning higher returns over the long term, but they also include market risk, even if these programmes offer set interest rates.
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.)
