Mutual Fund SIP: Start a SIP of ₹5000 with this strategy with the birth of your child, you will be the owner of ₹50,00,000 at the age of 18...
Mutual Fund SIP: Everyone wants to give a good future to their child, so the responsibility also increases with the birth of the child. As the children grow up, their needs and expenses also increase. If you do not plan for this in time, then you may have problems raising money later. Therefore, try to start investing in a scheme for the child as soon as he is born, so that enough funds are accumulated for him so that when he grows up, you do not have to worry about his higher studies and other necessary expenses.
Mutual Fund SIP can prove to be a better option in this case. This is a means of investment that can beat inflation and create a good fund for the future. If you start a SIP of just Rs 5000 with the birth of your child and keep applying a top-up of 5% every year, then you will accumulate more than Rs 50,00,000 in 18 years. Know how here-
How will the 5% top-up be applied?
If you start a SIP of Rs 5000 and apply a top-up of 5% on it every year, then you get a huge benefit from it. Top-Up SIP is a facility in which you can add some amount to your regular SIP. Suppose you start a SIP of Rs 5,000 and apply a top-up of 5% every year, then in the initial year, you will have to deposit only Rs 5,000 for 12 months.
In the next year, you have to increase this amount by 5% of 5,000, which will be Rs 250. That is, next year you will have to deposit Rs 5,250 in SIP. In the next year, you have to increase 5% of Rs 5,250 i.e. Rs 262.5 i.e. Rs 263, which means you will have to run a SIP of Rs 5,513. Similarly, you have to apply a top-up of 5% on the total amount every year.
How will you accumulate more than Rs 50,00,000?
If you run a SIP of Rs 5,000 with an annual top-up of 5% for 18 years, you will invest a total of Rs 16,87,943. The average return on SIP in the long term is considered to be 12%. At the rate of 12%, you will get Rs 34,57,451 only as interest. In this way, after 18 years, your child will be the owner of Rs 51,45,394. If the return is more than 12%, then the amount will be even more after 18 years.
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