Saving just Rs 50/day after Class 10, Class 12 results can help you get up to Rs 3 crore – Here’s how

Call it a lack of awareness about the importance of money in life at a young age, a large number of people tend to start their investing journey very late in life. And they lose a golden opportunity to accumulate a very large corpus by investing very small amounts in the process.

Calculation shows that saving even Rs 50 per day and investing it in a monthly Mutual Fund SIP scheme from an early age can help an investor accumulate crores of rupees by the time they reach their retirement age.

As CBSE Class 10 and Class 12 results are being announced today, let’s have a look at how big the portfolio value will grow if someone starts saving Rs 50 per day and investing in a SIP plan.

After Class 10 Result: Investing via SIP

The average age at which students generally appear in the Class 10 exam is 15. If a student starts saving Rs 50 per day, s/he will have Rs 1500 at the end of the month, which can be invested in a good mutual fund scheme via SIP.

Also Read: From age 20 to 55, monthly investment needed for Rs 10 crore on retirement

The SIP calculator shows that by investing Rs 1500 per month for 45 years, or the years by which this investor will reach the retirement age of 60 years, s/he can get Rs 3.32 crore if the annualised return from the scheme is 12% per year. Even if the rate of return is just 10% per year, this investor will be able to get around Rs 1.5 crore by age 60.

After Class 12 Result: Investing via SIP

The average age at which students generally appear in the Class 12 exam is 17-19. If a student starts investing Rs 1500 per month, by saving Rs 50 daily, from age 20 in a good mutual fund scheme, it will help him/her get around Rs 1.78 crore in 40 years, assuming 12% annualised returns on investment. Even if the rate of return is just 10% per year, this investor will be able to get around Rs 95 lakh by age 60.

After Class 10, Class 12 Result: Investing via PPF

While mutual fund SIPs are considered risky because of market-related risks, young investors can also go for guaranteed schemes such as PPF. The calculation shows that an investment of Rs 1500 per month in a PPF account will give around Rs 39 lakh in 40 years and Rs 56 lakh in 45 years at 7.1% annual interest.

The PPF interest rate is revised every quarter by the Government. While this account matures in 15 years, investors are allowed to increase their tenure in blocks of 5 years for as long as they want (Know more about PPF here).

(Disclaimer: The above content is for information purposes only. Mutual Fund investments are subject to market risks. Please consult a certified financial advisor before investing)