Power of One-time Investment, SIP Returns: We want to magnify our investments on a large scale. It is a dream for us to make a small deposit and withdraw a large corpus. Such a dream can surely be a reality if one uses the power of time effectively. Even if an investor gets modest growth for a long time, their small investments may generate a large amount for the investor. A one-time investment of Rs 5,00,000 and a monthly SIP investment of Rs 8,333 (Rs 1 lakh a year) may help one generate a corpus of approximately Rs 4,36,49,703 in the long term.

Know how it may be possible –

Power of one-time investment in long term

It is impossible to time the market in market-linked investments. Similarly, it is impossible to gauge the average interest rate in long-term fixed interest rate investments. But both investments in the long term may generate huge returns. Let’s understand with two examples. 

Corpus Rs 2,00,000 one-time investment in 25, 35 years 

If the rate of annualised return is 12 per cent, the estimated corpus generated in 25 years will be Rs 34,00,013.

But if the person stays for 10 more years in investment, their estimated corpus will be Rs 1,05,59,924. 

A 10-year investment frame multiplied the corpus by more than 3 times.

PPF corpus in 25, 35 years

One can invest a maximum of Rs 1,50,000 in a financial year in PPF. The current compound interest rate in PPF is 7.1 per cent. Let’s see, at that interest rate, what they may generate in 25 and 35 years.

In 25 years, the total investment will be Rs 37,50,000, the estimated interest will be Rs 65,58,015, and the estimated corpus will be Rs 1,03,08,015.

In 35 years, the total investment will be Rs 52,50,000, the estimated interest will be Rs 1,74,47,857, and the estimated corpus will be Rs 2,26,97,857.

Corpus from Rs 5,000 monthly SIP investment in 25, 35 years

In 25 years, the total investment will be Rs 15,00,000, estimated capital gains will be Rs 70,11,033, and the estimated corpus will be Rs 85,11,033.

In 35 years, the total investment will be Rs 21,00,000, estimated capital gains will be Rs 2,54,54,156, and the estimated corpus will be Rs 2,75,54,156.

In all 3 examples, you may see how 10 years of extra investing is making a significant difference.

Rs 4,43,94,732 corpus by 50 years of age

Here we are assuming that a 20-year-old person will invest Rs 6,00,000 one time and start a monthly SIP investment of Rs 8,333. They will get an estimated return of 12 per cent from their investments, and their investment duration will be 30 years. Let’s see what their estimated returns will be and the corpus generated by their 50th birthday. 

Return from Rs 6,00,000 one-time investment in 30 years

The estimated capital gains from the Rs 6,00,000 one-time investment in 30 years will be Rs 1,73,75,953, and the estimated corpus will be Rs 1,79,75,953.

Return from Rs 8,333 monthly SIP investment in 30 years

In 30 years, the total investment will be Rs 29,99,880, estimated capital gains will be Rs 2,26,73,870, and the estimated corpus will be Rs 2,56,73,750.

Estimated total corpus generated by 50 years of age 

The estimated lump sum and SIP corpus combined will be Rs 4,36,49,703. 

(Disclaimer: This is not investment advice. Do your own due diligence or consult an expert for financial planning.)