Dear Friends Every common man in India wants o be a crorepati. How a Systematic Investment Plan (SIP) in Mutual Funds equity scheme can fulfill the dream of every common man.
Illustration : Mr. Sunit is a 25yrs old married man. He works as a junior assistant in a private firm in Mumbai. His salary is Rs.15000/-per month. Although he could not save much but always dreams of becoming a crorepati. If u think that he is day dreaming and cannot fulfill his dream then you are certainly wrong. Let's find out that how he can use Systematic Investment Plan (SIP) to fulfill his dream. Sunit will opt for Yearly Growing SIP. WHAT IS GROWING SIP ? Growing SIP means the investor will increase the monthly SIP amount by a certain percentage every year. For example : If the initial SIP Amount is Rs.1000/- per month & grows 20% every year, that means : 1st Year the SIP amount is Rs.1000/- per month 2nd Year the SIP amount is Rs.1200/- per month 3rd Year the SIP amount is Rs.1440/- and continues this way every year....... WHY SUNIT IS OPTING FOR GROWING SIP ? Sunit has a very long term planning of creating wealth. He knows that the way inflation is growing; a Rs.1000/- SIP amount will have hardly any value after 10 or 15 years later. As he is expecting growth in his salary with time, therefore he is opting for a Growing Yearly SIP. Sunit - Age 25 Years Wants Rs.10,000,000/- in 25 Years When he will attain the age of 50 Years Annual % increase is investible amount : 20% Sunit Expectations of returns 12% RESULT : Sunit will need to start an SIP of Rs.759/- per month NON GROWING SIP (FIXED YEARLY SIP) : Non Growing SIP is a normal SIP where monthly SIP amount remains fixed for the entire term of the investment. Expected Number of Years of SIP Returns (%) 5 10 15 20 25 30 10 129,581 49,638 24,899 13,812 8,044 4,809 12 123,299 44,636 21,011 10,871 5,875 3,246 15 114,492 38,020 16,224 7,535 3,628 1,776 20 101,313 29,044 10,466 4,038 1,597 638 SUMMARY : To get Rs.1crore in 25years Mr. Sunit will require to start a monthly SIP of Rs.759/- only and will have to increase the same by 20% every year i.e. he will start a monthly SIP of Rs.759/- in the 1st year, monthly SIP of Rs.910/- in the 2nd Year and so on.... (with assumed market return of 12%) If Mr.Sunit wants to invest a fixed SIP amount for the entire tenure (Non Growing SIP) then to get 1crore in 25 years he will need to do monthly SIP of Rs.5875/- for 25 years (with assumed market return of 12%) OR Rs.3628/- (with assumed market return of 15%) With Best Regards SHENOY INVESTMENT AND FINANCIAL CONSULTANTS PRIVATE LIMITED 11-A, KASHI NIKETAN, 2ND ROAD, CHEMBUR, MUMBAI - 400 071 TEL : 6797 3433 / 2521 2111 EMAIL : shifc...@gmail.com shifc...@mtnl.net.in Dealing in Mutual Funds, General & Life Insurance Products, Post Office Schemes, Fixed Deposits, I.P.Os., and Capital Gains Bonds -- You received this message because you are subscribed to the Google Groups "BETTER PERSONALITY GROUP" group. To post to this group, send email to better_personality@googlegroups.com. To unsubscribe from this group, send email to better_personality+unsubscr...@googlegroups.com. For more options, visit this group at http://groups.google.com/group/better_personality?hl=en.