SIP Calculator: Save just Rs. 1000 every month and become a millionaire in this many years! Understand the complete investment math..
Today, mutual fund SIPs (Systematic Investment Plans) have become the most preferred investment method for common investors. The biggest reason for this is that it doesn't require investing a large sum of money at once. You can start investing with a small amount every month and gradually build a large fund. This is why salaried individuals, small investors, and first-time investors are increasingly opting for SIPs.
How can a ₹1000 SIP become ₹10 lakh?
People often wonder how long it will take to build a substantial fund with the money they invest in SIPs every month. SIP calculators provide the answer to this question. If you start a SIP with just ₹1000 every month and continue investing for a long period, your money can grow over time.
Understand the complete calculation with a SIP calculator
If an investor invests ₹1000 every month in a SIP and receives an annual return of approximately 12%, it may take about 21 years to build a fund of ₹10 lakh.
In these 21 years, the investor will invest a total of ₹2,52,000.
According to the estimate, they can receive approximately ₹11,39,000. Of this, about ₹8,87,000 could be the return on investment.
If you increase your SIP amount by just 10% every year (Step-up SIP), you can build this ₹10 lakh fund in even less time than 21 years.
It is very important to understand that the returns in mutual funds are not fixed. SIP returns depend on the fluctuations of the stock market. Sometimes the return may be higher, and sometimes lower. However, investors who invest for the long term usually see better results.
Should you stop your SIP when the market falls?
It is often observed that when the stock market falls, SIP investors panic and start thinking about stopping their SIPs. But this is considered the biggest mistake. The benefit of mutual funds comes in the long term. A market downturn is not the time to stop your SIP, but rather to continue investing. When the market goes down, shares are available at lower prices. SIPs (Systematic Investment Plans) started during such times can yield higher returns in the future. This is why a market downturn should be seen as an opportunity, not a reason to panic.
Choosing the right fund is also crucial.
Every investor should choose a fund based on their needs and risk tolerance. If someone wants higher returns, they can consider equity funds. If they want to minimize risk, debt or hybrid funds might be better options.
Additionally, some people invest in ETFs such as digital gold. Even small investments, started early, can build a substantial fund over the long term. It's essential not to make impulsive decisions during market fluctuations and to continue investing in the right funds for the long term.
Disclaimer: This content has been sourced and edited from NDTV India. While we have made modifications for clarity and presentation, the original content belongs to its respective authors and website. We do not claim ownership of the content.
