rewrite this title and make it good for SEOPower of Compounding: How quickly can monthly SIP of Rs 10,000, Rs 15,000, and Rs 20,000 build Rs 5 crore corpus?

You must have heard of compound interest back in your school days, but have you ever thought that it may have a major impact on the lives of investors? The knowledge of compounding can help you gather a large corpus through a small monthly investment if the investment horizon is long. It can provide you with financial freedom that can help you achieve many of your life’s financial goals. Thus, let’s understand how long it will take you to reach Rs 5 crore retirement corpus with monthly SIP investments of Rs 10,000, 15,000, and 20,000.

Read more: Power of Compounding: How soon will monthly SIP of Rs 6,650, Rs 9,550 and Rs 12,200 reach Rs 7 crore corpus target?

Understand the concept of compounding

The power of compounding is the process in which the money you invest will generate earnings from both the principal amount and the accrued earnings of compounding periods. The greater the number of compounding periods, the greater the compound interest growth. 

What is systematic investment plan?

SIP is an investment that allows investors to invest a fixed amount in a mutual fund scheme at regular intervals. The investment in SIP can be done daily, weekly, monthly, quarterly, or half-yearly, yearly. 

Benefits of compounding

Your investment can grow faster
Long-term growth
Reduces risk
Encourages long-term planning

Start investing early

If you put your money into an investment plan as soon as you start earning, you can enable your savings to grow significantly over time. 

SIP calculations

Target corpus: Rs 5 crore
Annualised return: 12 per cent
Monthly investments: Rs 10,000, Rs 15,000 Rs 20,000

How soon one can build Rs 5 crore with Rs 10,000 monthly SIP?

It will take approximately 34 years to achieve the target of Rs 5 crore retirement corpus. 

From Rs 10,000 monthly SIP to Rs 5 crore corpus at 12 per cent annualised return

The investment amount will be Rs 40,80,000, the estimated capital gains will be Rs 5,34,48,539 and the estimated retirement corpus will be Rs 5,75,28,539. 

How soon one can build Rs 5 crore with Rs 15,000 monthly SIP?

It will take approximately 30 years to achieve the target of Rs 5 crore retirement corpus. 

From Rs 15,000 monthly SIP to Rs 5 crore corpus

The investment amount will be Rs 54,00,000, the estimated capital gains will be Rs 4,75,48,707 and the estimated retirement corpus will be Rs 5,29,48,707. 

How soon one can build Rs 5 crore with Rs 20,000 monthly SIP?

It will take approximately 28 years to achieve the target of Rs 5 crore retirement corpus.

From Rs 20,000 monthly SIP to Rs 5 crore corpus

The investment amount will be Rs 67,20,000, the estimated capital gains will be Rs 4,84,51,694 and the estimated retirement corpus will be Rs 5,51,71,694. 

(Disclaimer: Our calculations are projections and not investment advice. Do your due diligence or consult an expert for financial planning)