SIP Calculator: Earning Rs 12 LPA At 30? Here's How To Build Rs 1 Crore By The Age Of 45

At the age of 30, many young professionals find themselves earning a comfortable salary. While monthly expenses, rent and lifestyle costs eat into the paycheck, there could be some disposable income to start investing for long-term wealth accumulation. If at the age of 30 you earn Rs 12 lakh per annum and have some disposable income, it could be the most suitable occasion to start your investment journey with a well-planned financial roadmap.

One of the easiest and most effective ways to build wealth with small investments is to put your money in a mutual fund Systematic Investment Plan (SIP). If you are 30 today and want to accumulate Rs 1 crore by the age of 45, you can easily achieve it. All it takes is smart planning, consistency and the power of compounding.

If you earn Rs 12 lakh a year, your monthly take-home salary could be around Rs 80,000 to Rs 90,000 after tax. Financial planners often suggest investing at least 10-15% of your income every month.

That means investing around Rs 10,000 to Rs 13,500 in a mutual fund SIP every month. Setting aside Rs 12,000 each month could be a practical and smart way to start building wealth for the future.

To build a Rs 1-crore corpus by the age of 45, someone earning Rs 12 lakh per annum at age 30 can start by investing Rs 12,000 per month through an SIP in diversified equity mutual funds.

Assuming an average annual return of 12% and increasing the SIP amount by 10% every year (to keep pace with potential salary hikes), the power of compounding could help you accumulate a huge corpus.

As per market trends, long-term equity mutual fund SIPs can fetch average returns between 12% and 14% annually. While short-term fluctuations are common, equity funds generally perform well over long periods.

Let’s see how your monthly investment of Rs 12,000 for 15 years would grow at an assumed interest rate of 12% per annum.

• Rs 12,000/month for 15 years at 12% return p.a. = Rs 60.5 lakh

If you increase your SIP by just 10% every year with every potential hike in salary (through a step-up SIP), your investment grows much faster. With a 10% yearly increase, your SIP can easily cross Rs 1 crore in 15 years.

For a long-term goal like this, you can explore equity mutual funds like flexi-cap funds, large-cap and mid-cap funds, or index funds.

Some top-rated funds have delivered over 14-16% annual returns in the past 10 years. Consistency and fund selection could be the key, but even an average-performing fund with steady SIPs can help you reach your goal easily.

There is no fixed formula to build a Rs 1 crore corpus in 15 years. It should be decided based on your risk appetite and financial needs. However, starting early could help to make the most out of the SIP investments due to the power of compounding.