• Source:JND
HighLights
  1. A ₹15,000 monthly SIP can build a ₹15 lakh corpus in six years, assuming a 12% annual return.
  2. Own your dream car debt-free by swapping monthly EMIs for a disciplined SIP strategy.

Owning a car is one of the top dreams for many young fellows entering the job market as a fresher or having been employed for a few months or a year. However, they find difficulty in buying one in the initial days of employment with a relatively low salary and savings. Amid all this, many young professionals manage to fulfil their dream of buying a car on EMI, whereas some do not want to have the burden of a loan on their heads. If you belong to the mindset of not buying a car on loan and buying one for full payment, then you need to take steps to accumulate money for the same from the early years of your employment. 

For instance, if you earn Rs 50,000 to Rs 60,000 a month and are planning to buy a car or SUV worth up to Rs 15 lakh, committing Rs 15,000 to an equity mutual fund through a systematic investment plan (SIP) could help you accumulate the estimated sum. However, you probably need to continue investing for 5-6 years. 

What time does it take to create Rs 15 Lakh with an SIP of Rs 15,000

Considering an estimated standard return rate of 12 per cent, you should keep investing for nearly six years to accumulate the precise Rs 15,00,000. Below is the calculation: 

  • During six years, you invest Rs 10,80,000 with a Rs 15,000 monthly SIP. 

  • Assumed Return - 12 per cent

  • Estimated Return- Rs 4,74,038

  • Total Value- Rs 15,54,038 (Principal Amount + Interest Earn)

SIP Strategy For Rs 15,00,000 In 5 years

However, if you have set a target to accumulate the Rs 15 lakh corpus for your dream car in five years, then you need to follow the step-up strategy every year. By stepping up the SIP amount by 12 per cent every year, the same could be achieved in five years as well.  

Step-up calculation 

Total Invested amount in 5 years with 12 per cent step-up - Rs 11,43,513

Total estimated return at an estimated return rate of 12 per cent- Rs 3,63,112

Total value- Rs 15,06,625 (Principal + Interest Earn) 

Disclaimer: The return rate is a hypothetical standard value. Investment and return in mutual funds are subject to market risk. All calculations are based on assumptions only. Please consult a financial advisor for investment-related advice.  


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