Power of Rs 500 SIP: How much wealth can you build in 20 years with Rs 500 monthly investment?

Power of Rs 500 SIP: For those looking to build a substantial corpus through consistent and disciplined contributions, a Systematic Investment Plan (SIP) in mutual funds can be a great option. SIP allows you to invest a fixed amount at regular intervals—such as monthly, quarterly, or annually—rather than making a lump sum investment. The best part is that you'll earn interest not only on your principal amount but also on the capital gains. This means that SIP leverages the power of compounding and has the potential to grow your investment over time."

In this write-up, we will explain, through calculations, how much corpus you can build in 20 years with a Rs 500 monthly investment -

Power of Rs 500 SIP: How much corpus you can build in 20 years with Rs 500 monthly investment?

According to the calculator, you can build Rs 4,99,574 (approx) in 20 years with a Rs 500 monthly investment. Let's know how -

Suppose you are investing Rs 500 monthly in an SIP mutual fund for 20 years. Then in these years, your total investment will be Rs 1,20,000. Assuming an average annual return of 12 per cent, your expected capital gain would be Rs 3,79,574. Therefore, by the end of 20 years, your total corpus would grow to approximately Rs 4,99,574.

Full Calculations -

Invested Amount: Rs 1,20,000
Capital Gain: Rs 3,79,574
Total Value: Rs 4,99,574

Things to remember while investing in SIP

It’s important to understand that SIP is a market-linked scheme, so returns are not guaranteed. The 12 per cent return mentioned above is an estimate, and actual returns may vary depending on market conditions. Let's look at some examples of the annualised return is 13 per cent and 14 per cent, then how much wealth can you accumulate in 20 years - 

Calculations if annualised return is 13%

According to the calculations, you can build an approximate corpus of Rs 5,72,760 in 20 years if the annualised return is 13 per cent.

Calculations if annualised return is 14%

According to the calculations, you can build an approximate corpus of Rs 6,58,173 in 20 years if the annualised return is 14 per cent.

(Disclaimer: Our calculations are projections and not investment advice. Do your due diligence or consult an expert for financial planning)