‘Money Attractive Money’ is one of those common things when it comes to investing in mutual funds. Everyone would like to earn big money, maybe even become a millionaire in India. Mutual funds have the potential to make an investor a millionaire. But like every other market-linked instrument, MFs are also subject to risk and have their ups and downs. However, the real trick is when the returns are achieved on a longer term basis. In this case, the best way to build a corpus of the 15X15X15 rule is 1 crore.
In simple words, the 15X15X15 rule revolves around three factors – investment value, tenure and expected returns. and to give effect to this rule, the Systematic Investment Plan (sip) is seen as the best mechanism.
On its website, Nippon India mutual fund 15X15X15 gives a complete explanation of the rule. This said, compounding, for mutual fund investment, refers to a phenomenon that turns a small amount into a significant corpus when invested over a long period of time. In other words, the returns you earn in one compounding period will, in turn, earn returns in the next compounding period, and so on.
Nippon MF explains with an example: Let’s say you invest 15,000 per month in the mutual fund for 15 years and is expected to generate 15% rate of return.
As per the compound interest calculation, Nippon MF highlights that the amount you get after 15 years is ~. will be 1 crore. The same compounding principle, when applied for the next 15 years, makes the total corpus grow exponentially by ~. rises to 100 million.
15X15X15 Rule One of the most common ways to invest in MFs is through SIP.
How? Your 15,000 monthly investment would mean total 27 lakhs were invested in mutual funds for 180 months. The estimated return on your investment will be approx. 74 lakhs — that will drain your corpus 1.01 crore.
Nippon said the sooner you start investing this way, the more assets you can accumulate over time.
According to Dr. Vikas Gupta, CEO and Chief Investment Strategist, OmniScience Capital, Diwali is a great time to think about your present and future family assets.
Gupta said, “You should consider that you need around 500-600 times your current monthly expenses on retirement so that you can live the same lifestyle without the risk of running out of money in your old age. This assumes that Retirement is more than 15-20 years away. Also consider the 15-15-15 rule that 15000 invested monthly for 15 years in an asset class – usually equity – that generates 15% per year, can create a fund 1 crore.”
Further, Gupta added that “although this is not investment advice that one should seek from their financial advisor, a person aged 45 years, with a monthly expenditure of Rs 1 lakh, ideally, an additional Rs 1 lakh Must invest monthly. In equities during the rest of your working life to build your retirement corpus of around Rs 4 to 6 crores. It may take few years if the actual returns are less but it is still likely to be in crores Get there early with the sum of the lump sum amount.”
While the stock markets have been facing extreme volatility due to macroeconomic risks so far this year, there has been a significant jump in appetite for SIPs. SIP inflows in the month of September 12,976 crores — just a few crores away from the crossing 13,000 points. Flow has been up in SIP 12,000 crore from May this year till now. In the first six months of FY23, SIP inflows are approx. 74,234 crore — up 31.5% from 56,454 crore was recorded in the corresponding period (April to September) of the last financial year. In FY22, SIP inflows remained on record 1,24,566 crores.
According to AMFI, there are currently around 5.84 crore (58.4 million) SIP accounts in Indian mutual funds, through which investors regularly invest in Indian mutual fund schemes.
AMFI states that SIP is an investment plan (methodology) offered by mutual funds, in which a fixed amount can be invested in a mutual fund scheme from time to time at a specified interval – month instead of making lump sum investment. I once. SIP installment amount can be as small as 500 per month. SIP is similar to a recurring deposit where you deposit a small/fixed amount every month. SIP is a very convenient way to invest in mutual funds through standing instructions to debit your bank account every month, without the hassle of writing a check every time.
Further, it said, SIP is gaining popularity among Indian MF investors, as it helps in rupee cost averaging and also helps in investing in a disciplined manner without worrying about market volatility and market timing. .
Disclaimer: The views and recommendations given above are those of individual analysts or broking companies and not of Mint.
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