Equity MF: Anjan Kumar Singh, who lives in Andheri, Mumbai, is currently 24 years old. He draws a salary of ₹ 35000 every month. He wants to start an investment from next April. His target is to have a corpus of Rs 5.5 crore by the time he turns 45.
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Invest in Equity MF
In this regard, experts say that he wants to raise more than ₹ 5 crore in a period of 20 years. If he does not want to invest directly in the stock market, then equity mutual funds can prove to be the best option for him. In long-term mutual fund investments, they can expect a return of 15 per cent per annum.
Increase SIP amount every month
Experts recommend that Singh should keep increasing his monthly SIP amount every month. As their income increases according to the monthly salary, they need to increase the SIP amount. As a salaried professional, Singh can get a salary increase of 10% every year. Accordingly, they need to increase their SIP amount by 15% annually.
15*15*15 Formula for MF
A common formula for ship investors is that if they invest ₹15000 every month for 15 years, they can get a return of 15 per cent. They may have to increase their SIP amount by 15% every year to raise a corpus of ₹5 crore over a period of 20 years.
Target to be accomplished in 20 years
He needs to put ₹15,000 in equity mutual funds over a month to garner 5 crores in the next 20 years. If he increases this SIP amount every month at the rate of 15 percent, he can meet his target in the stipulated time.
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