SIP Calculator Explained: Time Needed to Build ₹10 Lakh with Monthly Investments of ₹1,000, ₹2,000, or ₹5,000

Mutual funds are becoming one of the most preferred investment options for Indian investors, thanks to their flexibility and growth potential. Among the various ways to invest in mutual funds, the Systematic Investment Plan (SIP) has gained tremendous popularity. SIP allows investors to put aside a fixed amount of money at regular intervals—usually monthly—and benefit from the power of compounding over time.

If you are aiming to build a fund of ₹10 lakh, you may wonder how long it will take with different SIP amounts. Let’s break it down with simple calculations assuming a 12% annual return, a commonly used benchmark for equity mutual funds.

How Long to Accumulate ₹10 Lakh with SIP?

1. SIP of ₹1,000 per Month

If you start investing just ₹1,000 per month through SIP at an average return of 12%, it will take you approximately 20 to 21 years to build a corpus of ₹10 lakh. While the time frame is long, this shows the power of patience and consistency in wealth creation.

2. SIP of ₹2,000 per Month

Doubling the contribution to ₹2,000 per month reduces the timeline significantly. At the same 12% return, your investment will grow into ₹10 lakh in about 15 years. This demonstrates how even a small increase in SIP contributions can fast-track your financial goals.

3. SIP of ₹5,000 per Month

With a more aggressive contribution of ₹5,000 per month, you can achieve the ₹10 lakh target in just 9 to 10 years. This option works well for those who want to achieve financial milestones earlier, such as funding a child’s education, making a down payment for a house, or planning a long-term vacation.

Why Timing the Market Doesn’t Work

A common question among investors is: When is the right time to start a SIP? According to Shaily Gang, Head of Product at Tata Asset Management, the real secret is not “when” you invest but “how long” you stay invested.

Thanks to the compounding effect, the longer your money remains invested, the higher your returns grow exponentially. Many investors try to time the market by waiting for a correction before starting their SIP. However, this strategy often backfires. By waiting, you lose valuable time in the market, which could have multiplied your wealth.

In fact, starting your SIP at current levels and continuing it through market ups and downs usually delivers better results than delaying investments in the hope of a dip.

Step-Up SIP: A Smarter Strategy

For those who want to accelerate wealth creation, a step-up SIP can be a powerful tool. In this strategy, you increase your SIP amount gradually—say by 5% to 10% every year. Over time, this approach helps you invest more without straining your budget initially and results in much higher returns compared to a fixed SIP amount.

For example, if you begin with ₹2,000 per month and increase it by 10% every year, your corpus will grow significantly faster than sticking with ₹2,000 throughout.

Key Takeaways for Investors

• Start Early: The earlier you start, the more time your money gets to compound.

• Stay Consistent: Regular contributions matter more than market timing.

• Increase Gradually: Use step-up SIPs to boost long-term wealth.

• Think Long-Term: Patience and discipline are essential for building a solid financial foundation.

Final Word

Building a fund of ₹10 lakh through SIPs is achievable for every investor, whether you can spare ₹1,000, ₹2,000, or ₹5,000 per month. What truly matters is your consistency and investment horizon. Instead of waiting for the perfect market condition, the smartest move is to start your SIP today and let compounding work its magic.

📊 Disclaimer: Mutual fund investments are subject to market risks. Past performance is not indicative of future returns. Please consult a financial advisor before making investment decisions