SIP Tips: Make Rs 2 crore by investing Rs 5,000 every month in SIP, know how?

Over the years, investors have explored new asset classes and investment tools. Awareness about the stock market and financial investments has improved among people in India these days. Mutual funds are a good place for investors who want better returns than traditional savings instruments without the market risk. Systematic Investment Plans (SIPs) of mutual funds are becoming increasingly popular as they offer investors great flexibility and liquidity.

How to become a millionaire with SIP

Compared to traditional investment instruments such as fixed deposits and small savings schemes, mutual funds have given higher returns over the years. Also, SIPs (Systematic Investment Plans) are more flexible, allowing investors to start, stop, or increase investments as per their needs. The main way of wealth accumulation through SIPs is to start early and stay invested for a long time.

Even a modest SIP of ₹5,000 per month can grow significantly over 20-25 years. This makes SIPs a suitable investment option to build a large retirement fund. If you want to create a corpus of ₹2 crore and are doing a SIP of ₹5,000 every month, then let us tell you how your money will grow:

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Target: ₹2 crore
Monthly SIP: ₹5,000
Time: 31 years
Invested amount: ₹18,60,000
Estimated return: ₹1,80,92,022
Total value: ₹1,99,52,022

Thus, a SIP of ₹5,000 can help you create a significant retirement corpus, provided you have an investment time of at least 30 years. With techniques like ‘step-up’ SIP, this dream can be achieved even faster. The ‘step-up’ facility is a simple way to increase the SIP amount at regular intervals (e.g., every year).

Target: ₹2 crore
Monthly SIP: ₹5,000
Step-up target: 10% p.a.
Tenure: 25 years
Amount invested: ₹59,00,823
Estimated returns: ₹1,54,76,906
Net worth: ₹2,13,77,730

When the ‘step-up’ technique is used, the total investment amount increases in the long run. However, it helps the investor reach their goal faster. Investors should also keep in mind that mutual funds do not guarantee returns.

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