Grow ₹4,000 a Month Into ₹10 Lakh: A Simple SIP Investment Guide

With bank interest rates at record lows, parking money in savings accounts no longer grows wealth the way it used to. Many are now looking at mutual fund SIPs (Systematic Investment Plans) to earn higher returns. SIPs allow you to invest a fixed amount every month, making it easier to invest consistently without worrying about timing the market.

Why Choose Mutual Funds?

Mutual funds are an attractive option because they offer the potential for higher returns than bank deposits. However, higher returns come with higher risks, so choosing the right fund is essential. Experts suggest opting for funds that target 12–14% annual returns, balancing growth with manageable risk.

The Power of SIP:

Let’s take an example: if you start a SIP of ₹4,000 every month, how long will it take to build a fund of ₹10 lakh?

• Monthly SIP: ₹4,000
• Expected return: 12% per year
• Time to reach ₹10 lakh: 11 years

By the end of 11 years, your total fund could grow to approximately ₹10.98 lakh, out of which ₹5.28 lakh is your invested capital. The rest is generated through compounding, the real magic of SIPs. The key takeaway: even a modest monthly investment , when started early, can create a substantial long-term corpus.

Cash Investment in Mutual Funds

While most people invest via bank accounts, certain individuals can also invest in mutual funds with cash. This includes farmers, laborers, small traders, and businessmen who do not have a PAN or bank account. The only condition is that a maximum of ₹50,000 per financial year can be invested in cash.

Risks to Keep in Mind

Mutual funds are subject to market fluctuations, which means returns are not guaranteed. Equity-linked funds may offer high returns but can be volatile. Debt-oriented funds are more stable but usually offer lower returns. Therefore, it’s crucial to align your fund choice with your risk tolerance and investment horizon.

Why Start Early?

The earlier you start, the more time your money has to grow through compounding. Even small SIPs like ₹4,000 per month can result in impressive wealth over a decade. Starting early reduces the pressure of investing large sums later and makes wealth-building more manageable.

A SIP is a simple, disciplined way to grow wealth steadily. By investing small amounts consistently and choosing funds wisely, you can turn modest savings into a financial milestone, like a ₹10 lakh fund, in just over a decade. Even if you invest via cash or bank, the principle remains the same: start early, stay consistent, and let your money work for you.



Disclaimer:

The information provided in this article is for educational and informational purposes only. We are not encouraging or advising any investment. Readers should consult a certified financial advisor or investment expert before making any financial decisions. Newspoint will not be responsible for any gains, losses, or consequences resulting from investments made based on this information.