Mutual Fund SIP: Young people often postpone investment after getting a job. They feel that they have their whole life ahead of them, so in the beginning people prefer to travel a little, buy a new bike, a new phone or spend on things of their choice.

However, in the world of investment, not only the amount matters, but time is also very important. Many times a delay of just 5 years in starting investment makes a difference of crores of rupees till retirement.

What is the difference between starting SIP at the age of 25 and 30?

Suppose a young man gets his first job at the age of 25. His salary is Rs 40,000 per month and he can comfortably do SIP of Rs 10,000 every month. At that time, he neither has any home loan nor any big responsibility of the family. Despite this, many people postpone investment and think that they will start after the salary increases.

When the same person turns 30, the picture has changed. The salary may increase to around Rs 1 lakh per month, but the responsibilities of marriage, home, children and future also increase. Then they realize that just a good salary is not enough, but investment is also necessary. In this way, he starts a SIP of Rs 10,000 every month, but by then he has lost 5 years of precious time.

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How much is the loss caused by a delay of 5 years?

If both investors do SIP of Rs 10,000 every month and get an average annual return of 12%, then a person who starts SIP at the age of 25 can create a corpus of around Rs 5.5 crore by the time of retirement at the age of 60.

At the same time, an investor starting at the age of 30 will be able to create a fund of only about Rs 3.08 crore. The surprising thing is that there is a difference of only Rs 6 lakh in the total investment of both, but at the time of retirement there is a difference of about Rs 2.42 crore in the fund.

Why does this happen?

The reason for this big difference is compounding. Compounding means that the returns you get on your investment also start earning returns in the future. The more time one gets to invest, the faster the money grows.

The first investment of Rs 10,000 made at the age of 25 has the opportunity to grow for 35 years, whereas an investment started at the age of 30 can grow only for 30 years. This extra 5 years makes a difference of crores of rupees in the long run.

Lessons for young investors

• Don’t wait for a big salary to start investing.
• It is beneficial to start early even with a small amount.
• Time is the greatest partner of investment.
• You can create a big fund in SIP in the long run.

This is why for many people, just 5 years between 25 and 30 can make the difference between a corpus of Rs 3 crore and Rs 5.5 crore at the time of retirement.

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SIP News: We always look at SIP i.e. Systematic Investment Plan as a savings. We deduct a small amount every month and invest it for years and then get interest on it, which keeps our future safe. But there is another aspect to it, that is, whenever the stock market falls, this SIP becomes our biggest support. Let us tell you how?

Market decline is a big opportunity
In fact, whenever there is a sharp decline in the stock market, investors get nervous. At that time, everyone sees the value of their mutual fund portfolio decreasing and decides to stop or stop SIP. But this should not be done, because the period of decline in the market is like an opportunity for those investors who invest for a long time.

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The biggest advantage of SIP is that you invest a fixed amount every month, whether the market is up or down. When the market falls, the NAV (net asset value) of the mutual fund also falls. In such a situation, your same SIP amount buys more units than before. That means you get more shares at lower prices. If we understand this in simple language, then during the fall in the market, you are “buying cheap”. Later, when the market improves, these extra units help in increasing your returns.

Why is XIRR important for investors?
Most investors use CAGR to see the performance of their investments, but in SIP, money is invested at different times every month. Therefore XIRR is considered more accurate for SIP. It gives accurate returns keeping in mind the date and amount of each installment.

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understand with example
Suppose two people have done SIP of Rs 10,000 per month at the same time. As soon as the market fell, the investor continued his SIP and the other investor stopped it and started again when the market became normal. So in such a situation, the investor who continued SIP during the fall bought more units at a lower price. After the recovery in the market, his portfolio reached around Rs 2.51 lakh and its XIRR was around 49%.

Whereas the portfolio of the investor who stopped SIP was around Rs 1.46 lakh and his XIRR was limited to around 27%. This means that investors who continue investing when the market falls get more benefits.

Wedding SIP: Do you also dream that your wedding will be royal and grand? Do you also want to have a destination wedding like the celebs? Or do you also want to wear a designer lehenga in your wedding like the celebs? So this also requires a lot of money, where will it come from? This is not a difficult task but very easy. For this, it is necessary to have a little understanding and a routine. Let us tell you how.

How to save money for marriage?
Nowadays the expense of marriage reaches lakhs of rupees. In such a situation, many people take loan for marriage or exhaust their savings. But if you want to save your savings and do not want to take a loan, then you should start investing from now on. For this you can take help of Wedding SIP. This will be easy and you will not incur too much debt.

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How will Wedding SIP work?
Everyone has to get married sometime or the other, in such a situation, suppose your marriage is to happen after 10 years and Rs 20 lakh is required for it. If you start investing in SIP every month from now and get around 12% annual returns, then you can save lakhs of rupees for your marriage.

Even if you have been married for 5 years, you can still save around Rs 5 lakh. For this you will have to invest around Rs 2500 every month in SIP. This is not a huge amount, but it can definitely cover your wedding expenses.

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Which expenses can be covered?
If you are a bride and have deposited Rs 5 lakh through SIP, then you can bear the expenses like your wedding clothes, jewellery, make-up for every function, shoes and slippers etc. yourself. By doing this you will not have to worry about anything and it will not put too much burden on the family.

So if you are a groom, then there is no expense for clothes and jewellery. But you will be able to bear the burden of facilities like catering or booking the hall for your wedding yourself. Or with this you will also be able to go on honeymoon after marriage.

SIP Calculator: Do you also want to add a huge amount for your future by investing every month? Do you also think that adding Rs 1 crore is like a dream for you? So this is not the case at all, with just a little investment you can add this amount for the future. You might be a little surprised after reading these things, but this is absolutely true. Here we will tell you the mathematics of SIP, after reading which you will start seeing this dream in front of you.

Amount up to Rs 1 crore will be deposited through SIP
Almost everyone knows about SIP i.e. Systematic Investment Plan. Through this, you withdraw a fixed amount every month which is deposited in this investment plan. Some interest rate is charged on this amount every month, due to which this money keeps increasing. Over many years, the amount you deposit and the interest rate together become your savings for your future. If you also want to add up to Rs 1 crore in 10 or 20 years, then here we tell you the method.

Add Rs 1 crore in 20 years like this
If you want to add up to Rs 1 crore in 20 years, then for this you will have to understand a little mathematics. For example, suppose you are giving SIP of Rs 12,000 every month. You are getting 11 percent interest on this. Then you will be able to add more than Rs 1 crore after 20 years. Let us explain its mathematics:

Monthly SIP: Rs 12,000
Years: for 20 years
Returns: 11%
Total Investment: Rs 28,80,000
Future Value: Around Rs 1.04 crore

Similarly, if you want to add up to Rs 1 crore in 10 years, then for that you will have to withdraw double the monthly amount mentioned above, i.e. around Rs 25 to 30 thousand. However, withdrawing double SIP is not easy for everyone. In such a situation, whenever you invest, do it keeping in mind your current expenses. So that you do not have to face any kind of difficulty.

SIP Investment: To accumulate a substantial savings in life, earning money alone is not enough. It is even more important to invest the earned money in the right place. It has been seen many times that people doing normal jobs or business have limited income. Despite this, they create wealth by investing long term and wisely. At the same time, some people are not aware of investment options and take wrong decisions regarding money.

Due to which they suffer financial loss. Therefore, before investing, you must get information about the investment options available in the market. So that you can get maximum returns on your investment. If you are looking for an option to invest small amounts and give good returns in the long run, then you should think about mutual fund SIP.

SIP in mutual fund

Doing SIP in mutual funds is considered right for those who are ready to invest for a long time. If you have a small amount and you invest a little every month, then through SIP you can collect a good amount in the long term. The most special thing about SIP in mutual funds is that you can start your SIP journey with a small investment of Rs 250 to 500.

Market experts believe that SIP in mutual funds can give annual returns of up to 12 percent. However, this investment is subject to market risks, so one should not be afraid of market fluctuations. You can benefit from long term investment.

A fund of Rs 1.59 crore can be created with a monthly SIP of Rs 2000.

With a monthly SIP of Rs 2000, you can create a fund of Rs 1.59 crore. For this you will have to continue investing for 30 years and increase the investment at the rate of 10 percent every year. If you start investing early then this goal can be achieved.

Disclaimer: (The information provided here is being given for information only. It is important to mention here that investment in the market is subject to market risks. Always take expert advice before investing money as an investor. ABPLive.com never advises anyone to invest money here.)

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