How much should I invest via SIP in mutual funds to create Rs 3 crore?

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I want to build a corpus of Rs 3 crore by the time I retire at 60. My risk profile is moderate. I have a stable income, and I am planning to stay invested for more than 15 years.

I have the following SIPs in my portfolio:
Mirae Asset Emerging Bluechip Fund: Rs 1,500 per month
SBI Banking & Financial Services Fund: Rs 1,000 per month

Also, I have some other lumpsum investments which are not of high value. I started my investments this July, and I am 27 years old. Could you recommend me some best SIPs? Also, comment about my current SIPs. What should be my SIP investment to achieve a good corpus by the time I retire.
- Adarsh Menon

Assuming an average return of 12 per cent, you need to invest around Rs 8,500 per month to build a corpus of Rs 3 crore in 30 years. However, a word of caution: such seemingly large, round numbers will not be enough to take care of your future financial goals. That is why it is always better to identify your long-term financial goals, find out the current cost to meet the goal, provide for a reasonable inflation number, and taxes if possible, to arrive at a realistic target. For more, watch the slideshow below: Why Rs 1 crore will not ensure a rich retired life?
Why Rs 1 crore will not ensure a rich retired life?
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Rs 1 crore, Rs 2 crore, or Rs 5 crore will not guarantee a cushy retired life to you. Why? The basic idea behind creating a target corpus is to ensure that returns or interest from it would be enough to take care of your expenses after retirement. Have you done the math to find out whether the big round figure would do that?

Rs 1 crore, Rs 2 crore, or Rs 5 crore will not guarantee a cushy retired life to you. Why? The basic idea behind creating a target corpus is to ensure that returns or interest from it would be enough..
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Sure, Rs 1 crore is a large sum today. But do you believe it will have the same value after 20 years? Do you know how inflation impacts the value of money over a long period? For example, the value of a house is Rs 1 crore today. Do you know how much you need to shell out to buy it after 20 years? Hold your breath: you need Rs 3.21 crore to buy the same house after 20 years, accounting for an annual inflation of 6 per cent. In other words, Rs 1 crore would be worth 1/3rd of its value (around Rs 31 lakh) today after 20 years.

Sure, Rs 1 crore is a large sum today. But do you believe it will have the same value after 20 years? Do you know how inflation impacts the value of money over a long period? For example, the value o..
Read More

Everyone knows about inflation, but many people fail to include it in their financial planning. Be it retirement or child's higher education, inflation would add a few zeros to your target corpus over a long period. Failing to account for it would be disastrous.

Everyone knows about inflation, but many people fail to include it in their financial planning. Be it retirement or child's higher education, inflation would add a few zeros to your target corpus ove..
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The best way to tame the villain is to work with actual numbers. Always find out the current cost of your financial goal. Once you have it, inflate it with a realistic inflation number for every year. This will help you to arrive at a realistic corpus. You can use the FV formula in Mircosoft Excel or compounding interest formula to do this calculation.

The best way to tame the villain is to work with actual numbers. Always find out the current cost of your financial goal. Once you have it, inflate it with a realistic inflation number for every year..
Read More

Once you know the target corpus, you need to identify an ideal investment vehicle to achieve the goal. Sure, since it is a long-term goal, you should naturally opt for equity mutual fund schemes. However, make sure you chose an equity mutual fund category that is in line with your risk profile. You may use the PMT formula in Microsoft Excel to find how to much you need to invest every month to create your target corpus.

Once you know the target corpus, you need to identify an ideal investment vehicle to achieve the goal. Sure, since it is a long-term goal, you should naturally opt for equity mutual fund schemes. How..
Read More

You can check our special page ‘Retire rich with mutual funds’ to know everything about planning your retirement with mutual funds.

You can check our special page ‘Retire rich with mutual funds’ to know everything about planning your retirement with mutual funds.

You are currently investing in a large & mid cap scheme and thematic scheme. Both the schemes are not in line with your stated risk profile. Large & mid cap schemes are mandated to invest 35% of the corpus in large cap stocks and 35% in mid cap schemes. Mid cap stocks carry higher risk and they can also be very volatile. That is why you should have a slightly higher risk appetite to invest in large & mid cap schemes. We do not recommend thematic schemes to regular investors. We believe regular investors are better off with multi cap schemes. Multi cap schemes can invest across market capitalisations and sectors. That means a good multi cap mutual funds will always have a meaningful exposure to a promising sector or stocks in a certain market captialisations.

  • 21.34%Annualized Return for 3 year
  • >3 years Suggested Investment Horizon
  • 3.6 YearsTime taken to double money
  • 16.05%Annualized Return for 3 year
  • >3 years Suggested Investment Horizon
  • 2.6 YearsTime taken to double money
Since you have a moderate risk appetite, you should invest in a good multi cap scheme to take care of your long-term financial goals. Try to increase your SIP investments every year or whenever your salary goes up. This will help you to maximise your savings and investments. Here are our recommended multi cap funds: Best Multi Cap Funds to Invest in 2019

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