Power of 10,000 SIP: How soon can you generate Rs 1 crore corpus with Rs 10,000 monthly investment?

A systematic investment plan, which is popularly known as SIP, is a method through which you can invest a fixed amount in mutual funds of your choice regularly. Generally, the investment can be done daily, weekly, monthly, quarterly, or yearly. In SIP, some of the mutual funds also allow investors to start investing with a smaller amount, for example, with Rs 100, making it accessible to all. Now, the question is whether you can generate a Rs 1 crore corpus with a Rs 10,000 monthly SIP. Also, if it is possible, then how soon can you build this corpus?  

Through SIP, one can aim to generate Rs 1 crore corpus. Let’s understand it fairly with the help of calculations that how soon can you generate a Rs 1 crore corpus with a Rs 10,000 monthly investment. 

Role of compounding

We talked about SIP; now let’s shift our focus a bit and discuss compounding, as it plays a major role in building your wealth over time. All of us must have heard of compounding and read about it in our school days, but who knew that in the field of investment, compounding would play a major role?

What is compounding?

Compounding, in finance, refers to the process of earning returns on both the initial investment and the accumulated return from previous periods. This means that your money grows at an accelerated rate because the return earned also starts earning a return. It’s often described as earning return on return.

SIP calculation conditions

• Target corpus: Rs 1 crore corpus 
• Monthly investment: Rs 10,000
• Annualised return: 12 per cent

How soon can you generate Rs 1 crore corpus with Rs 10,000 monthly SIP?

It will take approximately 21 years to generate Rs 1 crore.

How much can Rs 10,000 monthly SIP build in 10 years?

The investment amount will be Rs 12,00,000, the capital gains will be Rs 10,40,359, and the estimated retirement corpus will be Rs 22,40,359. 

How much can Rs 10,000 monthly SIP build in 15 years?

The investment amount will be Rs 18,00,000, the capital gains will be Rs 29,59,314, and the estimated retirement corpus will be Rs 47,59,314.

How much can Rs 10,000 monthly SIP build in 20 years?

The investment amount will be Rs 24,00,000, the capital gains will be Rs 67,98,574, and the estimated retirement corpus will be Rs 91,98,574.

How much can Rs 10,000 monthly SIP build in 21 years?

The investment amount will be Rs 25,20,000, the capital gains will be Rs 79,10,067, and the estimated retirement corpus will be Rs 1,04,30,067.

Also Read: Top Performing Small Cap Mutual Funds with Highest SIP Returns: Rs 20,000 monthly investment in No. 1 fund has grown to Rs 94.54 lakh in 10 years