You can get a return of 40 lakhs on SIP of Rs 2500
SIP is the best way to get better returns from long term investments. Cow investment done through SIP in the long term gives you the benefit of compounding. Riskk factor is also less in long term investment. Suppose a youth from the age of 25 years deposits Rs 2500 every month through SIP and if mutual funds get a return of 12% per annum, then according to the SIP calculator, the net return on investment in the next 25 years is 47.5 lakhs. Will be of Rs. During this, the total amount of investment will be only 7.5 lakh rupees. The investor will get a return of around Rs 40 lakh.
Timing is important for investment
Timing is very important for investment. Suppose if a person continues investing for 30 years, then his net return will be Rs 88.24 lakh. That is, the investor can earn double the amount in just 5 years. In these 30 years, the investor will deposit a total of Rs 9 lakh. He will get a return of 79.2 lakhs on this deposit. It is clear from this calculation that how important is the time duration for investment.
how much should be invested
The question remains in the mind of the youth that how much they should invest. Financial Management recommends investing based on a 50/30/20 rule. According to experts, limit all your essential expenses to 50 per cent of your income. Set aside 30 percent for things other than necessities. You must invest at least 20 percent of the money.