How much will a person earn with ₹5,000 monthly SIP in 10, 20 & 30 years?
Investing in a Systematic Investment Plan (SIP) is a popular way to invest in the stock market, especially for those who are new to investing. SIPs allow investors to invest a fixed amount of money at regular intervals, which helps to ride out market volatility and reduce the impact of market fluctuations. But how much can you expect to earn with a SIP?
According to SEBI’s SIP calculator, if you invest ₹5,000 every month at a rate of 15% per annum, you can expect significant returns over a period of 10, 20, or 30 years.
10-year SIP
In 10 years, your ₹5,000 monthly SIP will earn you a whopping ₹13.76 lakh, with a total investment value of ₹6 lakh. This means that your investment has grown by more than 2.3 times the initial amount you invested. This is a significant return, especially considering that the interest rate is only 15% per annum.
To break it down further, here’s a rough estimate of how your investment will grow over the 10-year period:
- Year 1-5: Your investment will grow by around ₹2.5 lakh
- Year 5-10: Your investment will grow by around ₹11.26 lakh
As you can see, the returns are much higher in the later years of the SIP, which is a characteristic of long-term investing.
20-year SIP
In 20 years, your ₹5,000 monthly SIP will earn you a staggering ₹74.86 lakh, with a total investment value of ₹12 lakh. This means that your investment has grown by more than 15 times the initial amount you invested.
Here’s a rough estimate of how your investment will grow over the 20-year period:
- Year 1-10: Your investment will grow by around ₹13.76 lakh
- Year 10-20: Your investment will grow by around ₹61.1 lakh
As you can see, the returns are much higher in the later years of the SIP, which is a characteristic of long-term investing.
30-year SIP
In 30 years, your ₹5,000 monthly SIP will earn you a massive ₹3.46 crore, with a total investment value of ₹20 lakh. This means that your investment has grown by more than 69 times the initial amount you invested.
Here’s a rough estimate of how your investment will grow over the 30-year period:
- Year 1-20: Your investment will grow by around ₹74.86 lakh
- Year 20-30: Your investment will grow by around ₹2.71 crore
As you can see, the returns are much higher in the later years of the SIP, which is a characteristic of long-term investing.
Conclusion
As you can see, the power of compounding is a powerful force that can help your investment grow significantly over time. By investing ₹5,000 every month for 10, 20, or 30 years, you can expect to earn significant returns, and potentially even retire with a substantial sum.
Of course, these figures are just estimates, and the actual returns you receive will depend on a variety of factors, including the performance of the stock market and the interest rate. However, as a general rule, long-term investing is a great way to grow your wealth over time.
News Source:
