Power of Compounding: In how many years can you generate Rs 2,00,00,000 corpus with just Rs 7,000 monthly investment?

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For now, let’s decode how many years it can take to build a sizeable corpus of Rs 2 crore with Rs 7000 monthly investment in a systematic investment plan. Also, the investment amount shouldn't be a concern. Many believe a small sum is not enough for investment purposes. If that’s the case, then why do some of the mutual funds allow investors to invest starting from just Rs 100? On that note, let’s go through the calculations to find out how soon you can build the target corpus.

What is SIP?

A systematic investment plan is a medium to invest a fixed amount in a mutual fund scheme at regular intervals. You can change the investment amount according to your financial circumstances.

Investment in Systematic Investment Plan (SIP)

The SIP investment can be done according to the choice of the investor’s investment capacity- daily, weekly, monthly, quarterly, half-yearly, or yearly.

SIP calculation conditions

Target corpus: Rs 2 crore
Monthly investment: Rs 7,000
Annualised return: 12 per cent

How much can Rs 7,000 monthly SIP build in 10 years?

During that time, the invested amount will be Rs 8,40,000, and the estimated capital gains will be Rs 7,28,251. The estimated retirement corpus will be Rs 15,68,251.

How much can Rs 7,000 monthly SIP build in 15 years?

The invested amount will be Rs 12,60,000, and the estimated capital gains will be Rs 20,71,520. The estimated retirement corpus will be Rs 33,31,520.

How much can Rs 7,000 monthly SIP build in 20 years?

The invested amount will be Rs 16,80,000, and the estimated capital gains will be Rs 47,59,001. The estimated retirement corpus will be Rs 64,39,001.

How much can Rs 7,000 monthly SIP build in 25 years?

The invested amount will be Rs 21,00,000, and the estimated capital gains will be Rs 98,15,446. The estimated retirement corpus will be Rs 1,19,15,446.

How much can Rs 7,000 monthly SIP build in 30 years?

The invested amount will be Rs 25,20,000, and the estimated capital gains will be Rs 1,90,46,812. The estimated retirement corpus will be Rs 2,15,66,812.