• Source:JND
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SIP Investment: India has a large population that desires to invest directly in the stock market; however, they do not invest because of the volatility in the share prices and the high risk involved. People who want to reap the advantages of investing in the stock market without directly investing in shares should invest in mutual funds via a systematic investment plan (SIP). SIP has emerged as a useful tool for accumulating a large sum of money over a long period.

Systematic Investment Plan is a great investment option for those looking to develop an investment discipline and continue to invest a fixed amount every month without being excessively affected by stock market fluctuations. SIP can lead to a regular income. Systematic Investment Plan (SIP) is not merely a way to make money but also a means to secure a regular income for your future. You may begin investing in your systematic investment plan with Rs 3,000 per month if you are 25 years old.

It may appear insignificant to you, but you will be shocked to learn that when you retire in 35 years, you will have not just invested, but will also have generated a regular income for your post-retirement life.

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Rs 3,000 monthly SIP calculation

Investment at an early age, that is, between the ages of 20-30, provides a great opportunity to create good wealth. Your investments reap the benefits of compounding and also give you a steady source of income as you approach retirement age. Assume that you begin investing Rs 3,000 every month, then by the time you reach the 35th year of your investment, with five percent annual growth, it will grow to a monthly investment of Rs 15,760. This means that in the first year of your investment, you invest Rs 36,000 in SIP, whereas in the 35th year, you invest Rs 1.89 lakh.

Let's assume that the average growth rate is 12 percent, then in 35 years, you will invest Rs 32.51 lakh and your invested amount has the potential to grow to Rs 2.99 crore. This is how your small amount of investment over the long run can create a large amount of wealth for you.

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