How many years will it take to create a corpus of ₹1 crore from SIPs of ₹2,000, ₹5,000, and ₹10,000? Read the calculations..

SIP is often chosen for investing in mutual funds. This is because SIPs allow you to invest in installments. Today, we will use SIP calculations to understand when a SIP of Rs 2,000, Rs 5,000, and Rs 10,000 will create a fund of Rs 1 crore.

Calculation
Rs 2,000
If a person makes a monthly SIP of Rs 2,000 and wants a fund of Rs 1 crore, then at a 12% return, they would have to invest for 33 years.

Rs 5,000
If a person wants to create a fund of Rs 1 crore through a monthly SIP of Rs 5,000, then at a 12% return, they would have to invest for 26 years. A SIP of Rs 5,000 every month for 26 years will create a fund of Rs 1 crore.

10,000 Rupees
If you invest 10,000 rupees every month in a SIP, it would take 20 years to build a corpus of 1 crore rupees, assuming a 12% return.

What is a Step-up SIP?
A Step-up SIP means that you increase your investment amount by a fixed amount over a period of time. This period can be one year, one month, or any number. The amount you want to increase depends entirely on you.

What is the benefit of this?
Suppose an investor decides to increase their investment amount by 10% every year through the Step-up option. This means that if the investment amount is 1 lakh rupees in the first year, it will be 1,10,000 rupees in the second year.

With Step-Up, your investment amount keeps increasing over a period of time. Therefore, if the investment amount is higher, the profit share will also be higher.

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