Mutual Fund SIP Tips: Indian investors are always looking for a good investment option. Many investors prefer safe investment options, while some investors are also ready for market risks. If you are planning to build a big corpus by investing small amounts of money, then you can consider Systematic Investment Plan (SIP).
By investing small amounts for a long time in mutual fund SIP, you can create a corpus worth crores of rupees. Let us know, how you can create a fund of Rs 1.30 crore by investing Rs 7000 every month in Step Up SIP.
Mutual Fund Step Up SIP
Under step up SIP investment, you increase your monthly SIP amount by about 10 percent every year. That is, with time your investment amount increases, due to which the total amount deposited in the fund also increases. Besides, you also get higher returns as compared to normal SIP.
On average, returns of up to 12 percent can be obtained in mutual fund SIP. This return can also go up or down depending on the movement of the market. However, the specialty of Step Up SIP is that due to the increasing investment amount, there is usually a possibility of getting higher returns than a normal SIP.
Corpus of Rs 1.30 crore
If you continue Step Up SIP of Rs 7,000 every month for a period of 20 years, your total investment will be around Rs 48.11 lakh. If market conditions are right, you can get an annual return of about 12 percent on this investment.
According to this, after 20 years you are likely to have a corpus of Rs 1.30 crore. That means your earning can reach approximately Rs 82.30 lakh. Under State Up SIP, you will have to invest Rs 7000 thousand in the first year and in the next year you will have to invest 10 percent of this amount i.e. Rs 7700. You will have to continue this process for the next 20 years.
Disclaimer: (The information provided here is being given for information only. It is important to mention here that investment in the market is subject to market risks. Always take expert advice before investing money as an investor. ABPLive.com never advises anyone to invest money here.)
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