According to investment advisor, if you want a big fund then equity mutual funds can be a good option. If an investor makes his first investment of Rs 3000 at the age of 30 and makes regular investments for 30 years, a big fund will be created. It is beneficial to invest in Systematic Investment Plan (SIP) of equity mutual funds.
The most accurate formula of SIP
If you believe the advisor, you have to invest in mutual funds for 30 years. If you get an estimated return of 15% then the path to becoming a millionaire becomes easy. The biggest benefit is compounding. Meaning, you will get the benefit of compound interest along with 15% in 30 years. But, what is more important is the most accurate formula, which will add value to SIP. This formula is of Step Up SIP. All you have to do is maintain a step-up rate of 10% every year.
How to become a millionaire?
You are 30 years old. Saved Rs 100 daily and invested in SIP. Long term strategy aimed for 30 years. Keep doing 10% step-up every year. If you started with Rs 3000, you will have to increase it by Rs 300 next year. After 30 years you will have a maturity amount of Rs 4,17,63,700. According to SIP calculator, your total investment in 30 years will be Rs 59,21,785. But, here there will be a profit of Rs 3 crore 58 lakh 41 thousand 915 just from the return. This is the magic of returns in SIP. In this way, with the help of the most accurate formula step-up, you will have a huge fund of Rs 4 crore 17 lakh.
