How to Become Millionaire By Investing Rupees 2500 Per month : My dear readers, who doesn’t want to become rich? Those who think a little higher are confused about how to become a millionaire. So in today’s article we will all know how an ordinary person earning a monthly salary of Rs 15000 can become a millionaire by investing Rs 2000 to 2500.
Actually becoming a millionaire is not a very difficult or impossible task, but for this you will have to work hard, give time along with this it is very important to maintain patience. In today’s article we will learn in detail about becoming a millionaire in the mutual fund industry. Before investing in mutual funds you need to know what these Mutual Funds are.
Meaning of Mutual Fund
Investing in the stock market requires deep analysis like fundamental analysis. In view of this problems in the stock market, AMC (Asset Management Companies) established Mutual Funds, who’s job is to help investors invest by researching companies, various securities of the stock market and government securities and to give good returns on the investors money.
Types of Mutual Funds in English
Equity Fund.
Debt Fund.
Hybrid Fund.
Solution Oriented.
Plans Gold Fund.
How to Become Millionaire By Doing SIP in Mutual Fund
If your monthly income is Rs 20,000 then if your expenses are balanced then you can save at least Rs 2000 to Rs 2500 every month. Instead of investing this savings anywhere else, start investing in mutual funds. With the systematic investment plan of just Rs2500/- you will definitely become a millionaire in 15 to 20 years.
Choosing the Right Mutual Fund
Systematic Investment Plan – it is very important to choose the right mutual fund when investing under SIP because investment in mutual funds is not made for one or two months. This investment is made for a long time i.e. More than 10 years, hence even a return of 1 to 2% has a big impact in a larger time frame, hence for doing SIP we should choose the mutual fund very carefully.
For example, if you interest in a large cap mutual fund, the chances of getting returns range from 15 to 25%. Similarly, there is a possibility of getting returns ranging from 20 to 36% in midcap mutual funds. Similarly, in small cap Mutual Funds there is the possibility of getting returns ranging from 25 to 40%.
Since we are looking at investing here for the long term i.e. more than 10 years, it makes sense to consider investing in small cap funds. The minimum return of small cap mutual fund companies can be considered to be 25% and the average return can be considered to be 30%.
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First Step Towards Becoming Millionaire
How to Become Millionaire : Now that you are determined to become a millionaire, then you should start SIP in any small cap mutual fund today with a small amount of Rs2500/- per month. Before investing, you have to decide one thing, no matter what happens you will neither stop your SIP.
This can be possible if you keep adding funds separately for your emergency. Because no one knows when you will need funds in life. Therefore , to maintain continuity in your SIP it is very important that you have an emergency fund of your own.
Value of Your Investment after 10 years of Your Investment
In the above statement, we learned that if we invest in a small cap mutual fund, we can get an annual return of at least 25%. Thus, after 10 years of starting SIP, our investment details will be as follows:
● Investment Time : 10 Years
● Total invested capital : Rs3,00,000
● Return on investment percentage : 25%
● Total returns received : Rs10,32,012
● Current value of investment : Rs13,32,012/-
That means after 10 years your total investment will become Rs 3 lakh and the total value of your investment will become Rupees 13,32,012. We do not have to stop this investment here, we will continue to make this systematic investment in future also.
Value of Your Investment after 15 years of Your Investment.
Now, when you have shown your patience and completed 15 years of your investment without stopping SIP, then the details of your investment will be as follows:
● Investment Time : 15 Years
● Total invested capital : Rs4,50,000
● Return on investment percentage : 25%
● Total returns received : Rs44,39,462
● Current value of investment : Rs48,89,462/-
Here we saw that the total value of our investment in the first 10 years was. Rs 13,32,012/- but in the next 5 years the value of our investment has increased by. Rs 35,57,450/- to Rs 48,89,462/-. You can check this return through the SIP calculator.
Value of Your Investment after 18 years of Your Investment.
Now, if you have shown your patience and have not closed your SaiP for 15 years, then you have come very close to becoming a millionaire. Now you have to continue your SIP for the next 3 years, after this you will be able to see the magic of compounding. Let us look at the details of the value of your investment after doing SIP for 18 years.
● Investment Time : 18 Years
● Total invested capital : Rs5,40,000
● Return on investment percentage : 25%
● Total returns received : Rs98,66,378
● Current value of investment : Rs1,04,06,378/-
Congratulations, by investing only Rs 2500/- every month for 18 years i.e. a total investment of Rs5,40,000, you have created a wealth of Rs 1 crore. This is the magic of compounding. Your investment of just Rs5,40,000 became more than Rs 1 crore in 18 years.
This is when we were investing only Rs 2500/- every month. But sir, think for yourself, if today your income is Rs 20,000/- per month, then will your income remain Rs 20,000/- per month even after 18 years . No this will not happen. Your income grows by about 10% every year. When your income is growing at the rate of 10% per annum, then as a rule you should increase the amount of your SIP by 10% i.e. you should use SIP.