- Investing Rs 200 daily can build a corpus of Rs 60 lakh in 20 years at 12% returns
- Daily SIPs offer flexible, affordable investment options with rupee cost averaging benefits
- Consistent daily investments benefit from the power of compounding over a long tenure
The popular belief is that you need a high income or large lump sum amount to build a sizable corpus. In reality, cutting Rs 200 in daily expenses, can also build you a substantial corpus over a longer tenure. Yes, you read that correctly. It's not necessary to have a big bank balance, wealth creation requires financial discipline and consistency.
Mutual fund schemes have daily SIP options, offering more flexibility compared to other instruments through systematic investment plans (SIP). You can start investing as low as Rs 100 per day and accumulate lakhs over a long-term horizon with consistency and financial discipline.
How Do Daily SIPs Help?
Suitable for investors looking for flexible and affordable investment instruments, daily SIPs help minimise risks due to the advantage of rupee cost averaging. The daily cycle of investments also brings an opportunity for potentially higher returns over the years due to the power of compounding.
What Corpus Rs 200 Daily Can Build In 20 Years?
Saving Rs 200 a day (around Rs 6,000 a month) can build a corpus of Rs 60 lakh. How? Let's assume you invest the daily amount for 20 years, and earn an average annual return of 12%.
- Daily investment: Rs 200 (Around Rs 6,000 per month)
- Tenure: 20 years
- Expected rate of return: 12% per annum
- Total investment: Rs 14.40 lakh
- Estimated returns: Rs 45.54 lakh
- Final corpus: Rs 59.94 lakh
ALSO READ: Rs 3,000 SIP For Child: How Small Savings Build A Big Corpus By Age 18
As per the above calculation, by investing just Rs 200 a day, you can achieve around Rs 60 lakh in approximately 20 years. Amazing, right?
The best part? Investors may choose to increase the amount of the daily SIP with a rise in your income to reach the goal faster. This technique, known as ‘step-up,' helps to boost the impact of the power of compounding.
- Daily investment: Rs 200 (increasing by 5% annually)
- Tenure: 20 years
- Expected rate of return: 12% per annum
- Total investment: Rs 23.80 lakh
- Estimated returns: Rs 58.61 lakh
- Final corpus: Rs 82.41 lakh
With just around 5% increase in contributions per year, you can end up getting a significantly larger corpus of around Rs 82 lakh.
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