A Systematic Investment Plan (SIP) is a simple way to invest in mutual funds regularly. It lets you put in a fixed amount of money at regular intervals, helping you invest in a disciplined manner. More and more young investors are opting SIPs every day, making it an increasingly popular investment option.
A SIP is a flexible way to invest in Mutual Funds. You can invest a fixed amount regularly (weekly, monthly, or quarterly) and adjust it anytime as per your financial situation. An SIP is a recurring investment where a fixed amount is auto-debited from your bank account and invested in your chosen mutual fund. Thereafter, you are given a corresponding number of units of your chosen mutual fund.
This article will help young investors determine the best SIP strategy for their needs, comparing options such as investing Rs 2,500 monthly for 30 years versus Rs 25,000 monthly for 10 years.
SIP Comparison
Assuming an expected annual return rate of 12%, we will compare and analyze the two SIP options to determine which one gives better results.
Rs 25,000/Month For 10 Years
- Monthly Investment: Rs 25,000
- Time Period: 10 years or 120 months
- Expected Annual Return Rate: 12%
- Total Invested Amount: Rs 30 lakh
- Estimated Return: Rs 28,08,477
- Total Amount At Maturity: Rs 58,08,477
Rs 2,500/Month For 30 Years
- Monthly Investment: Rs 2,500
- Time Period: 30 years or 360 months
- Expected Annual Return Rate: 12%
- Total Invested Amount: Rs 9 lakh
- Estimated Return: Rs 79,24,784
- Total Amount At Maturity: Rs 88,24,784
