How to become a millionaire by investing just Rs. 1000 every month? Learn the complete calculation

Investment Tips: Even a small saving of just Rs. 1000 every month can create a large fund in the long run. Learn how the right investment, the right timing, and the power of compounding can make you a millionaire, in simple terms.

Investment Tips:  Many investment options are available today. But SIP (Systematic Investment Plan) has become the first choice for many people. The biggest reason is that it doesn't require investing a large sum of money at once. You can start small and build a large fund over time.

Salaried individuals, small investors, and first-time investors prefer SIPs because they are easy, automatic, and instill discipline. Many people wonder if it's really possible to become a millionaire by investing Rs. 1000 every month? Let's understand the calculation.

How can Rs. 1000 SIP become Rs. 10 lakhs?

People often think that building a large fund with a small amount is impossible. But the real magic of SIP lies in time and compounding. If you invest Rs. 1000 every month and continue for a long period, your money gradually gains momentum.

The growth seems slow in the initial years. However, after some time, you begin earning returns on your initial investment. This is the power of compounding. This is why starting early in SIP is more important than investing a larger amount. The longer the time period, the faster the fund grows.

Understand the complete math with the SIP calculator

If an investor invests Rs. 1,000 every month in a SIP and receives an average annual return of 12 per cent, their fund can reach around Rs. 10 lakhs in about 21 years. In these 21 years, they will invest a total of approximately Rs. 2,52,000. According to estimates, the amount at maturity could be around Rs. 11,39,000, of which approximately Rs. 8,87,000 would be returns alone.

Now, let's talk about the target of Rs. 1 lakh. So, this can be achieved in about 6 years. This means that by investing just approximately 70,000 rupees, your fund can grow to over 1 lakh rupees. This shows that the real power lies not in the money itself, but in time.

Should you stop or continue your SIP when the market falls?

When the stock market falls, the most panic is seen among SIP investors. People start thinking that their money might be lost and decide to stop their SIPs. But this is the biggest mistake. A falling market means that good funds are available at lower prices. SIPs made during such times yield more units in the future, which results in significant profits when the market recovers. The real benefit of SIPs is hidden in market fluctuations. Therefore, a market downturn should be seen as an opportunity, not a reason to panic.