Retirement is a significant phase of life, and preparing for it early is essential to ensure financial independence. While planning for retirement you have to keep in mind the inflation and how much your monthly expenses are. In today’s article, we will discuss making a 5 Cr retirement corpus goal.
Importance of Retirement Planning
Retirement planning is crucial to maintaining your standard of living and avoiding dependence on others for financial support. Life is unpredictable, and planning ahead allows you to handle any uncertain situations with confidence.
When to Start Retirement Planning?
There’s no fixed ideal time to begin retirement planning. One can start in their 20s or 30s whenever he wants. However, starting early can work wonders for wealth accumulation through the power of compounding.
Retirement Planning with Mutual Fund SIP
A systematic investment plan (SIP) in mutual funds is an effective way to prepare for retirement. It enables investors to build wealth over time by investing a fixed amount at regular intervals like monthly, half-yearly, or yearly.
Investment Return Calculation
Suppose you are starting a monthly SIP of ₹15,000 at age 25. Assuming an annualized return of 12%, how will it grow in 10, 20 or 30 years? Lets check calculations.
After 10 yers total investment will be Rs 18,00,000 on top of that estimated returns will be Rs 16,85,086 so Total investment + returns will be Rs 34,85,086.
If you continue this for another 10 years after 20 years your total invested amount will be Rs 36,00,000. Returns amount will be Rs 1,13,87,219 so total investment + returns will be Rs 1,49,87,219.
And if you continue for 30 years your total investment will be Rs 54,00,000. This means returns will be at Rs 4,75,48,707 and total investment with returns will be Rs 5,29,48,707. So, this is how you can make 5 Cr retirement corpus with saving Rs 15000 every month.
