SIP Investment Strategy: You can build ₹1 Crore in 21 Years with ₹10,000 Monthly.

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Everyone saves some amount of their hard-earned money and wants to invest it in an option that gives the best returns. Franchise Fund SIP (Mutual Fund SIP) proves to be a great investment option with the claim that it gives good performance on investments in large stocks. By adopting the right strategy and investing with instructions, anyone can fulfil the dream of becoming a millionaire. To achieve this goal, adopting the 10X21X12 formula can prove to be very successful. Let's know how it works.

Compounding gives great benefits

SIP (Systematic Investment Plan) is a long term investment process, where the investor has to invest a fixed amount regularly. Its biggest advantage is compounding, which increases the invested amount manifold over time. If you invest Rs 10,000 every month and maintain this investment for a long time, you can become a millionaire.

Good returns from SIP in the long term

Stock market and mutual fund investments are subject to risk, but historically SIPs have given average returns of 10-15% per annum or more if invested for a long period of time. In many cases, returns of up to 18-20% have also been seen in the long term, which helps investors to build a huge fund.

How does the 10X21X12 formula work?

  •         10: Save Rs 10,000 every month and invest it.
  •          21: Invest this savings through SIP for 21 years.
  •         12: Expect an average annual return of 12% (though in some cases it can go up to 18-20%).

Under this formula, if you invest for 21 years, you will get tremendous benefit of compounding and your investment will become a big fund.

Calculation of becoming a millionaire

If calculated using SIP Calculator, investing Rs 10,000 every month

  • In 21 years: The total investment will be Rs 25.2 lakh, but the return due to compounding will be Rs 88.66 lakh. Thus, the total fund can reach Rs 1.13 crore.
  • In 15 years: The total investment will be Rs 18 lakh and the potential fund can be Rs 50.45 lakh.

Disclaimer: Mutual fund investments are subject to market risks, read all scheme related documents carefully.

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