10X20X15 SIP Formula: If you’re looking to build a substantial corpus through SIP (Systematic Investment Plan) in mutual funds, the 10X20X15 formula can be a good strategy. By following this approach, investors can potentially accumulate up to Rs 1.5 crore in just 20 years. This is achievable with the power of compounding – the process where the value of your investment grows by earning returns on both your initial principal and the accumulated interest or profits over time. The best part is that you can invest on a monthly, quarterly, biannual, or annual basis, rather than committing to a lump sum investment.
What is the 10X20X15 Formula? How Does It Work?
The 10X20X15 formula represents the following components:
– 10: A monthly investment of Rs 10,000.
– 20: The duration for which the SIP is maintained (20 years).
– 15: The expected annualised return of 15% for your SIP investments.
How Does the 10X20X15 SIP Formula Work? Example Breakdown
Here’s how the 10X20X15 SIP formula can potentially work for you. Let’s break it down:
– If you invest Rs 10,000 monthly for 20 years, your total investment will amount to Rs 24,00,000.
– Assuming an average return rate of 15 per cent, your estimated capital gain over 20 years would be approximately Rs 1,27,59,550.
– After 20 years, your investment could grow to around Rs 1,51,59,550. This amount includes both the capital gain and the total invested amount.
Full Calculation Using the 10X20X15 SIP Formula
Here’s the detailed breakdown for clarity:
– Monthly SIP Amount: Rs 10,000
– Duration: 20 years
– Expected Annual Return: 15%
– Total Investment: Rs 24,00,000
– Capital Gains: Rs 1,27,59,550
– Total Value After 20 Years: Rs 1,51,59,550
Important Considerations for SIP Returns
It’s crucial to remember that SIP is a market-linked investment. This means that returns are not guaranteed, and the 15 per cent return mentioned is just an estimate. Your actual returns may vary based on market conditions and the performance of the mutual funds you invest in.
