Rs 1 Lakh Salary? Here's How To Make Rs 1 Crore In 10 Years

A salary of Rs 1 lakh a month is a remarkable milestone for many people in professional life. This offers financial freedom and better opportunities for wealth creation with smart financial planning. If you are looking forward to building your first Rs 1 crore corpus with a salary of Rs 1 lakh per month, it just needs consistent investment and effective financial planning.  

To achieve the significant milestone of Rs 1 crore corpus, you can choose the tenure and the investment amount as per your financial needs. You can diversify your portfolio across various investment instruments to minimise risk while ensuring steady returns in the long run. If you are looking forward to an investment horizon of 10 years, here’s how you can accumulate Rs 1 crore.

To save Rs 1 crore in 10 years, you have to explore various scenarios and choose the best investment plan as per your financial position. For instance, you will be required to invest around Rs 44,000 per month to reach Rs 1 crore via equity mutuals at an assumed average annual return of 12%. This is practically half your monthly pay. Although it seems ambitious, it’s doable if you keep your expenses in check.

With a higher salary, it’s tempting to switch to an upgraded lifestyle like dining out regularly, buying gadgets or embarking on vacations. But each rupee saved today earns for you tomorrow. Keep your essential living expenses at 40% to 50% of your salary, allocate 10% for emergencies and invest the rest, as often advised by the financial experts.

Equity mutual funds and index funds are best suited for a 10-year period since they can beat inflation and provide higher returns. Do not invest too much in fixed deposits or low-return items, as they will not increase your money at a fast enough rate. Make your mutual fund SIPs automatic so the money is invested before you can use it.

As your income increases, also raise your SIP by a minimum of 10% every year. This seemingly small action facilitates compounding and decreases pressure on future years. Let’s assume you begin at Rs 50,000 per month and increase it by 10% each year. This may enable you to achieve the Rs 1 crore objective in a shorter tenure.

The stock market will fluctuate. The solution is to remain invested through all cycles and not withdraw money during a correction. Time in the market is far more important than timing the market.

Check your portfolio at least once a year. Rebalance your portfolio, if necessary, but don't keep fiddling. Discipline, not constant fiddling, is what generates wealth.

With a Rs 1 lakh per-month income, regular investing, tight-fisted expenses and consistency could be the key in reaching the Rs 1 crore target in 10 years.