- Featuring on Kaun Banega Crorepati offers a Rs 7 crore top prize only to few contestants
- Investing Rs 25,000 monthly for 30 years at 12% returns can yield Rs 7 crore via compounding
- Long investment horizons of 10-40 years help grow wealth through systematic investing
Featuring on megastar Amitabh Bachchan's reality game show Kaun Banega Crorepati remains a distant dream for many, as only a handful of contestants make it to the hot seat to compete for the Rs 7 crore top prize. But what if we tell you there's an effective way to generate the same amount over time?
Here's how you can earn Rs 7 crore with a well-planned investment strategy.
Planning Rs 7 crore corpus
It might sound like a challenging and formidable goal, but following a proper strategy, having the right mindset and staying disciplined can get you there. Those in their 20s can reach this target, or even surpass it, through modest, systematic investments.
Whether you are aiming for early retirement or simply looking to future-proof your life, a few key principles can help you reach this milestone.
Investment Horizon
Firstly, it is crucial to know the time required to stay invested. This usually starts with 10-20 years and can go up to 30-40 years as well, depending on the age of individuals. A longer investment tenure helps to accumulate a large amount even with small investments due to the power of compounding.
Another aspect that you must keep in mind is your risk tolerance. Following a longer time horizon helps you benefit from compounding, while a higher risk appetite offers equity-heavy portfolios that give higher returns.
Power of Compounding
With disciplined investing and compounding, you don't need to worry about retirement, as your corpus will only grow with time.
In simple terms, you can make anywhere around Rs 7 crore if you invest Rs 25,000 for 30 years through a mutual fund SIP, with an assumed return of 12% per annum.
Similarly, investors can reach this goal if they invest Rs 50,000 for 25 years or Rs 1,00,000 for 20 years.
Opting for the right investment options
To be able to generate a corpus of Rs 7 crore, a healthy mix of investment options, which are both growth-oriented and stable, is required.
1. Equity Mutual Funds: One of the most preferred investment instruments could be SIPs due to their potential to offer high returns.
2. Direct Stocks: Investing in stocks can generate higher rewards, but the risk is high here. It is advisable to do proper research before taking the plunge.
3. PPF, EPF, or NPS: These tax-efficient products enable you to earn extra money, besides your regular monthly income.
4. Gold and Bonds: Another suitable option could be to go for gold and government or corporate bonds for steady returns.
5. Real Estate: Although this requires a large investment, it is a great way to generate regular rental income.
In conclusion, reaching the Rs 7-crore goal might seem daunting initially, but it can be easily achieved through consistency and planning. However, it is advisable to evaluate your investment strategy basis your appetite for risk.
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