Becoming a crorepati is an aspirational goal for many Indians, but building this corpus requires discipline and financial prudence. Though not impossible, the target is especially daunting for the salaried class or those with small businesses.
Accumulating Rs 1 crore in just five years may seem unrealistic, but it can be achieved with consistent investments of a significant amount every month in high-growth assets like a mutual fund systematic investment plan (SIP). Even with a short-term investment horizon of five years, one can achieve the ambitious target of becoming a crorepati with strict financial discipline and an aggressive investment strategy. Adopting a focused approach and having a clear understanding of the risk-reward trade-off is key to becoming crorepati in the next five years.
In order to achieve the target of Rs 1 crore, SIPs could be a suitable choice as they offer market-linked returns. If you are planning to start your investment journey today to build a corpus of Rs 1 crore by 2030, let’s see how SIP investments at different expected annual return rates could help you achieve the target.
Scenario 1: Investing In Mutual Fund SIPs At 8% Interest Rate
Monthly investment needed: Rs 1,36,500
Tenure: 5 years
Total investment: Rs 81.9 lakh
Expected rate of return: 8%
Estimated returns: Rs 18.31 lakh
Maturity corpus: Rs 1 crore
Scenario 2: Investing In Mutual Fund SIPs At 10% Interest Rate
Monthly investment needed: Rs 1,30,000
Tenure: 5 years
Total investment: Rs 78 lakh
Expected rate of return: 10%
Estimated returns: Rs 22.32 lakh
Maturity corpus: Rs 1 crore
Scenario 3: Investing In Mutual Fund SIPs At 12% Interest Rate
Monthly investment needed: Rs 1,23,500
Tenure: 5 years
Total investment: Rs 74.1 lakh
Expected rate of return: 12%
Estimated returns: Rs 26.06 lakh
Maturity corpus: Rs 1 crore
The actual returns on SIP investments can differ from the values shown above due to market conditions and other factors. Obviously, the higher the interest you get, the lower the SIP amount required to reach the Rs 1- crore target. As seen from the above calculations, you can easily reach the target of Rs 1 crore in five years by investing more than Rs 1 lakh every month.
To reach a corpus of Rs 1 crore by the end of 2030, you will need to commit to a substantial monthly investment. Given the short horizon, a majority of your investment will need to be in high-growth assets. You must also be prepared for market volatility.
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