Kolkata: SIP + discipline is the most potent force to multiply investments. This is something that all investment strategists tell all the time. The most important point is that the force of long-term compounding is so powerful that even very small SIP amounts can accumulate significant wealth. The only condition is that one should have the discipline to continue it for a long period of time.
This week SBI Mutual Fund and State Bank of India (SBI) have come together to launch what Sebi chief Madhabi Puri Buch described as her long-standing dream. It is the SIP of Rs 250 — an amount that can just about buy a movie ticket at any city multiplex. This SIP has been named JanNivesh SIP. One can invest this amount every day, or every week or even every month.
How to invest in JanNibesh SIP of SBI
The focus of the JanNibesh SIP for Rs 250 a month is to allow small savers and first time investors in rural, semi-urban and urban areas to enter the world of mutual fund investing and profit from it. Now let’s check what results are offered by mutual fund SIP calculators with a monthly SIP of Rs 250. Now, the returns of a mutual fund is critically dependent on the rate of return of the mutual fund scheme where the investment is made.
Calculation with SIP calculator
If we assume a 12% return — that’s the template return on any SIP calculator — the amount amassed over 30 years with Rs 250 only every month is Rs 8,82,478. The out-of-pocket investment that an individual makes in that way is Rs 90,000 which generates returns of Rs 7,92,478. If the investor is fortunate enough to rake in 14% returns, the cumulative amount would rise to Rs 13,89,264 on the same investment of Rs 90,000. Equity-oriented mutual fund schemes can generate these rate of returns.
SIPs (Systematic Investment Plan) have become the most preferred investment route of the lower-middle and middle-class people of India and the number is rising every month. But a huge section of the population yet remains untapped which, mutual fund experts have always said, could come under the ambit of this domain if the amount of SIPs could be reduced. Earlier, Rs 500 monthly SIP was the smallest quantum of SIP allowed by most asset management companies in India.
(Disclaimer: This article is only meant to provide information. News9 does not recommend buying or selling shares or subscriptions of any IPO, Mutual Funds and crypto assets.)
The largest asset management company of the country and the biggest commercial bank State Bank of India have come together to launch a “chota SIP” of Rs 250, thereby expanding the reach and appeal of mutual fund SIPs. But do you know how much this meagre amount can accumulate for you over time. Personal Finance Business News – Personal Finance News, Share Market News, BSE/NSE News, Stock Exchange News Today
