Understand the calculation: How much of a monthly SIP is needed for a ₹10 crore fund?

Given the current inflationary environment, people are concerned about the future. Essentials and amenities such as healthcare, housing, education, and travel are becoming increasingly expensive. Consequently, people are striving to build substantial financial reserves to secure their families' and children's futures. Salaried individuals are seeking ways to accumulate a corpus running into crores before retirement. However, building such a large fund is achievable with proper planning. Accumulating a corpus of ₹10 crore is possible if planning begins early, and the Systematic Investment Plan (SIP) route can make this process easier.

Opting for a Systematic Investment Plan (SIP) in mutual funds is an excellent strategy for building a large corpus. While it requires some initial planning, the power of compounding takes care of the rest.

**The Math Behind a ₹10 Crore Corpus in 25 Years**
Building a ₹10 crore corpus via monthly SIPs is possible, provided you follow certain rules. Choosing the right fund is crucial; selecting the appropriate fund can simplify the process significantly. You can accumulate ₹10 crore by starting with a monthly SIP of ₹25,000. You must adopt a strategy of increasing your investment by 10% annually. With this approach, the fund can reach the ₹10 crore mark in 25 years.

Monthly investment amount: ₹25,000

Step-up % (annual): 10%

Investment tenure: 25 years

Estimated rate of return: 12%

Invested amount: ₹2,95,04,117

Estimated return: ₹7,73,84,534

Total value: ₹10,68,88,652

You can also employ an alternative strategy regarding the investment math. If you start with an SIP of ₹25,000 and increase your investment by 5% annually, you can still accumulate a corpus of ₹10 crore over a period of 28 years.

Monthly investment amount: ₹25,000

Step-up % (annual): 5%

Investment tenure: 28 years

Estimated rate of return: 12%

Total amount invested: ₹1,75,20,774

Estimated returns: ₹8,41,55,949

Total value: ₹10,16,76,724

Investors should also note that expert advice is essential for long-term investments. Consulting certified professionals can help you understand your risk appetite.

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