Do you know the real power of SIP for better future? If not then this article is just for you. In 2025, many individuals are focusing on achieving their financial goals. If you’re looking to secure a prosperous future for your child, consider giving them a unique gift this new year that could potentially make them a millionaire by the age of 24. Mutual funds are a well-known option, and you can start with an investment of just Rs 200 a day or Rs 6000 a month. Let’s explore how this works!
SIP is the ideal choice for mutual funds
The simplest way to invest in mutual funds is through a Systematic Investment Plan (SIP). This approach allows for long-term investment while benefiting from the power of compounding, which enhances your total savings over time. Nowadays, both urban and rural residents are increasingly interested in this investment method. As a result, there has been a significant rise in mutual fund investments recently. Even small contributions can accumulate into a substantial fund over the years.
Invest just 6000 rupees each month
Now, let’s discuss how to kick off a SIP in the new year and how this can help your child become a millionaire. The math is straightforward. By saving Rs 200 daily or Rs 6000 monthly and investing it through SIP, you can reach this financial goal. Historically, investors have seen returns of around 15-16% on various SIPs. Assuming a conservative average return of 12%, if you invest Rs 6000 monthly for 24 years, your total contributions will amount to Rs 17,28,000. With compounding, the returns could reach Rs 83,08,123. Therefore, by the time your child turns 24, they could have a total fund of Rs 1,00,36,123.
Increased returns bring even greater advantages
As previously noted, investors have seen returns not just at 12 percent in SIPs for mutual funds, but also at 15-16 percent. If the return on a monthly investment of Rs 6000 for your child rises to 15 percent, the total amount could exceed one and a half crore rupees after 24 years.
Investment and Return Breakdown
Monthly Investment: Rs 6000
Annual Investment: Rs 72,000
Estimated Annual Return: 15%
Investment Duration: 24 years
Total Contributions: Rs 17,28,000
Compounded Returns: Rs 1,51,80,240
Total Fund Value: Rs 1,69,08,240
What is SIP in Mutual Funds?
A Systematic Investment Plan (SIP) is a widely used method for investing in mutual funds. With SIP, you can make monthly investments in mutual funds. Once you opt for SIP, a predetermined amount is automatically deducted from your bank account each month and invested accordingly. Over the past few decades, mutual funds have delivered impressive returns, but selecting the right fund is crucial. Consulting a financial advisor can be beneficial in making the right choice.
