Investing in mutual funds through a systematic investment plan (SIP) is a popular and effective way to accumulate wealth over the long term. If you are looking to accumulate a significant amount of wealth, such as ₹50 crore, over a period of 30 years, then SIPs can help you achieve your financial goals. In this article, we will discuss how much you need to invest in SIPs to accumulate ₹50 crore in 30 years.

Assumptions

To calculate the amount required to accumulate ₹50 crore in 30 years, we have made the following assumptions:

1. The rate of return on the mutual funds is assumed to be 12% per annum.

2. The SIP amount is assumed to increase by 10% every year due to salary increments and inflation.

3. The investment horizon is assumed to be 30 years.

How much do you need to invest in SIPs to accumulate ₹50 crore in 30 years?

To accumulate ₹50 crore in 30 years with a rate of return of 12% per annum, you need to invest ₹15,070 per month. However, this assumes that the SIP amount remains constant throughout the investment horizon. In reality, your salary and expenses are likely to increase over time. Therefore, to adjust for inflation and salary increments, you need to increase your SIP amount every year.

If you increase your SIP amount by 10% every year, then you need to start with an initial SIP amount of ₹5,000 per month and increase it by ₹500 every year. This will help you accumulate ₹50 crore in 30 years.

Here is a table that shows the monthly SIP required to accumulate ₹50 crore in 30 years:

| Year | Monthly SIP Required |
|——|———————|
| 1 | ₹5,000 |
| 5 | ₹8,148 |
| 10 | ₹16,596 |
| 15 | ₹34,004 |
| 20 | ₹69,493 |
| 25 | ₹1,42,077 |
| 30 | ₹2,89,307 |

As you can see, starting with a modest SIP amount of ₹5,000 per month and increasing it by ₹500 every year can help you accumulate ₹50 crore in 30 years with a rate of return of 12% per annum.

Conclusion

Investing in mutual funds through SIPs is an effective way to accumulate wealth over the long term. By starting early, investing consistently, and increasing your SIP amount every year, you can accumulate a significant amount of wealth, such as ₹50 crore, in 30 years. It is important to choose the right mutual funds based on your investment objectives, risk tolerance, and financial goals. With discipline, patience, and a long-term investment horizon, you can achieve your financial goals and live the life of your dreams.