SIP Tips: The magic of SIP, you can create a fund of crores by investing Rs 5000; know how..

If you also think that investing lakhs is necessary to become a millionaire, then you will be surprised to know that a fund of crores can be created by investing just Rs 5000 per month.

For this, you just need discipline, patience, and the right strategy in investment. Because investments made in mutual funds through SIP (Systematic Investment Plan) can create such a big fund over time, which can make you a millionaire.

Big benefit from a small amount
SIP is a way of investing in mutual funds in which you invest a fixed amount every month. This investment grows gradually and shows the magic of compounding over time. Compounding means that the interest you get on your investment also becomes a part of the next investment, and you get interest on that, too. In this way, the benefit keeps increasing due to compounding in the long term.

Can you become a millionaire with Rs 5000 per month?

If a person invests Rs 5000 in SIP every month and gets an average annual return of 12%, then he can easily become a millionaire in 25 years. But for this, it is most important that the investment is continued for a long time and the SIP is not stopped in between. At the same time, being afraid of the market falling can become an obstacle in achieving this goal.

How will your money grow? Know the calculation
Suppose you invest Rs 5000 every month in SIP and increase it by 10% every year, and you get an average return of 12%, then a fund of ₹ 16.34 lakh will be ready in 10 years. At the same time, a fund of ₹ 93.15 lakh will be created in 20 years and ₹ 1.96 crore will be ready in 25 years.

That is, a good fund can be created with time and discipline even by investing a small amount of Rs 5000 every month. Although the fluctuations in the stock market affect investments in mutual funds, investing in SIP generally gives good returns in the long term.

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