SIP Calculation: How many years will it take to create a corpus of ₹1 crore from SIPs of ₹2,000, ₹5,000, and ₹10,000? Read the calculation.

News Topical, Digital Desk : SIP is often chosen for investing in mutual funds. This is because SIPs allow you to invest in installments. Today, we will use SIP calculations to understand when SIPs of Rs 2,000, Rs 5,000, and Rs 10,000 will result in a corpus of Rs 1 crore.

calculation

2000 rupees

If a person does a SIP of Rs 2000 every month and wants a fund of Rs 1 crore, then at the rate of 12 per cent return, he will have to invest for 33 years. 

 5000 rupees

If a person wants to build a corpus of ₹1 crore with a monthly SIP of ₹5,000, they would need to invest for 26 years at a 12% return. A monthly SIP of ₹5,000 for 26 years would create a corpus of ₹1 crore.

10 thousand rupees

If an SIP of Rs 10,000 is done every month, then at the rate of 12 per cent return, one will have to invest for 20 years to create a fund of Rs 1 crore. 

What is Step-up SIP?

Step-up SIP means that you increase your investment by a fixed amount over a period of time. This timeframe could be one year, one month, or any other period. The amount you want to increase is also up to you.

What is the benefit of this?

Suppose an investor decides to increase their investment amount by 10% each year through the step-up option. This means that if the investment amount is ₹1 lakh in the first year, it will be ₹110,000 in the second year.

 Step-Up allows your investment amount to grow over a period of time. Therefore, if your investment amount is higher, your profit share will also be higher.

Read More: SIP Mistakes: You are not getting the expected profit from SIP, are you making these mistakes?