Systematic Investment Plan (SIP) is a lucrative way for individuals to invest their money. SIP is offered by Mutual Funds and it allows the investor to infuse a fixed amount into a Mutual Fund scheme at regular intervals. An individual can invest once a month or once every quarter instead of a lump sum amount at the same time.
Through SIP, investors have a chance to grow a substantial amount for their mid-term investment goals such as higher studies for children, dream vacations, sabbaticals, etc.
Even if you are not able to invest a lump sum amount, wealth can be accumulated one at a time through systematic investment.
Today, we will tell you how you can accumulate Rs 50 lakh in 10 years SIP plan. Tax and investment experts state that investment should be increased every time there is an increase in one’s income. An annual step-up in mutual funds SIP is a good option for that.
Whether Rs 50 lakh is achievable in 10 years, SEBI registered tax and investment expert Jitendra Solanki says, “Rs 50 lakh investment goal in 10 years is little ambitious and for that, the investor would require investment discipline like continuing one’s monthly SIP without fail in any circumstances. Apart from this, the investor should increase one’s monthly SIP using an annual step-up. This will enable an investor to start with the least possible monthly SIP amount,” as quoted by Live Mint.
Speaking about how much return can be expected after mutual funds SIP investment for 10 years, experts state that one can expect around 12 percent return after investing for 10 years.
Mutual Fund Calculator
Working with the assumption that a 15 percent yearly step-up is done and a 12 percent return is expected and the individual wants to accumulate Rs 50 lakh in 10 years. In this case, the mutual fund return calculator or mutual fund SIP calculator indicates that the individual will have to start a mutual fund’s SIP with a Rs 12,500 per month investment.