It is SIP of mutual funds that is the best, in case you are curious about saving a lot of money from small ones. This is not much trouble nor very high risk. Let’s teach you simply how to save Rs 49 lakh by saving just Rs 1500 every month.
What is SIP?
SIP implies that you invest a fixed amount in mutual fund schemes every month. This little investment helps to develop a big corpus gradually. It is like putting money in a piggy bank every day after the end of the year, you will find that a good amount of money has been accumulated. Moreover, you also get interest for investment in mutual funds which increases your value further. This is called compounding.
Here is the way how to reach Rs 49 lakh with SIP of Rs 1500
Assuming monthly investments of Rs 1500, let’s further assume that this investment generates an average annual return of 15%. Since you do not miss a single month, your savings will grow to the tune of Rs 4.5 lakh after 25 years, but the magic of interest and compounding will push it to around Rs 49 lakh. Isn’t it just amazing?
Magic of Small Money
Compounding implies that interest on your money also earns interest on itself over time. So, your money grows bigger every year. This can be understood as nurturing a sapling, it becomes a large tree.
Why SIP Works Wonders For an Individual
SIP has several benefits. Its number one benefit is that it can be started even with a small amount. It is very effective for persons who do not have so much at one go. Moreover, what with investing regularly in SIP, the market volatility effect does not so much concern one.
How easy it is to start SIP
To start SIP, it is as easy as one, two, three. First of all, you must open your account with a mutual fund platform. Your KYC should be completed for this. After that, it is up to you to select the right fund according to your needs and future goals. Once once that’s done, the money would automatically be invested every month.
Choosing the Right Plan
That perfect plan is different for everyone. It is dependent on age, income, and risk-taking abilities. If you cannot understand which fund suits you better, then ask a well-trusted financial advisor.
Embrace Patience for Regular Investments.
The biggest secret of success in SIP is patience. If you keep investing regularly without getting scared of market fluctuations, then your money will keep growing over time. Remember, hurry will not work here.
Conclusion
It is very much possible to build a huge corpus with an SIP of just Rs. 1500 per month. All that is needed is some discipline and patience. Start your SIP today and future-proof yourself. Small savings can bring big dreams to reality.
