SIP returns 12% annual return to different durations: Which option would you choose? A systematic investment plan (SIP) allows investors to manage their extra money to consistent with their mutual funding. Its popularity from the fact that it does not force the investor to arrange a large cash crash at a time to start setting financial purposes. It makes an investor not only to remain commitment to their long-term investment method but also maximizing the welfare of compounding.
For unchanged, compounding grows investments in the passage of time, helping make a lot of wealth for years. In times, compounding gives amazing results, especially for longer periods.
In this article, we compare three scenarios to see how things are in time to compound. Can you guess which SIP option gives the maximum return on an anticipated annual rate of 12 percent: Rs 5,000, or Rs 15,000 in 5 years?
SIP balig return | Which is the best of you: Rs 5,000 monthly SIP in 15 years, an Rs 10,000 SIP-ON 5 years?
Scenario 1: Rs 15,000 monthly SIP in 5 years
The calculations indicate that in an annual 12 per cent return, a monthly acoustic of Rs 15,000 in 5 years (with a total investment of Rs 9 lakh and a return of Rs 3.37 lakh).
Scenario 2: Rs 10,000 Month SIP 7.5 years
Similarly, with the same expected return, a monthly SIP of Rs 10,000 for 7.5 years (90 months) Rs 14.63 of Rs 9 lakh and an expected return of Rs 5.63 lakh).
Read again: Power of Rs 7,000 SIP: How do you create Rs 5 crore corpus with Rs 7,000 monthly investments?
Scenario 3: Rs 5,000 monthly SIP in 15 years
A monthly SIP of Rs 5,000 for 15 years (180 months) leads to a corpus around Rs 25.23 lakh (a ray Rs 9 lakh) and a return of Rs 16.23 lakh).
Now, let’s see these details in detail (rupees numbers):
SIP estimates of 12% expected annual returns | Scenario 1
| YEAR | Investment | Uli | Galpor |
| 1 | 1,80,000 | 12,140 | 1,92,140 |
| 2 | 3,60,000 | 48,648 | 4,08,648 |
| 3 | 5,40,000 | 1,12,615 | 6,52,615 |
| 4 | 7,20,000 | 2,07,523 | 9,27,523 |
| 5 | 9,00,000 | 3,37,295 | 12,37,295 |
SIP estimates of 12% expected annual returns | Scenario 2
| YEAR | Investment | Uli | Galpor |
| 1 | 1,20,000 | 8,093 | 1,28,093 |
| 2 | 2,40,000 | 32,432 | 2,72,432 |
| 3 | 3,60,000 | 75,076 | 4,35,076 |
| 4 | 4,80,000 | 1,38,348 | 6,18,348 |
| 5 | 6,00,000 | 2,24,864 | 8,24,864 |
| 6 | 7,20,000 | 3,37,570 | 10,57,570 |
| 7 | 8,40,000 | 4,79,790 | 13,19,790 |
| 7.5 | 9,00,000 | 5,63,119 | 14,63,119 |
SIP estimates of 12% expected annual returns | Scenario 3
| YEAR | Investment | Uli | Galpor |
| 1 | 60,000 | 4,047 | 64,047 |
| 2 | 1,20,000 | 16,216 | 1,36,216 |
| 3 | 1,80,000 | 37,538 | 2,17,538 |
| 4 | 2,40,000 | 69,174 | 3,09,174 |
| 5 | 3,00,000 | 1,12,432 | 4,12,432 |
| 6 | 3,60,000 | 1,68,785 | 5,28,785 |
| 7 | 4,20,000 | 2,39,895 | 6,59,895 |
| 8 | 4,80,000 | 3,27,633 | 8,07,633 |
| 9 | 5,40,000 | 4,34,108 | 9,74,108 |
| 10 | 6,00,000 | 5,61,695 | 11,61,695 |
| 11 | 6,60,000 | 7,13,074 | 13,73,074 |
| 12 | 7,20,000 | 8,91,261 | 16,11,261 |
| 13 | 7,80,000 | 10,99,656 | 18,79,656 |
| 14 | 8,40,000 | 13,42,090 | 21,82,090 |
| 15 | 9,00,000 | 16,22,880 | 25,22,880 |
Read again: PPF for Regular Earnings: How do you get Rs 60,000 / month income with no tax from Public Provident Fund?
SIP & Compoor | What is united, and how does it work with SIP?
Simply, compounding sips means income ‘return on return’. The interest you earn increased with your investment, etc.
More than longer periods of time, this joint value continues to grow, which helps your money easily.
This compounding power leads to developmental growth, especially for long SIP. Read more with compounding power
