If you have been able to save ₹20 lakh, well done! You seem to have crossed a big milestone towards securing your financial future. Well, what if this amount could grow to ₹1 crore? This could just be a matter of having a good investment strategy and some patience and discipline. Now, let us analyze a working plan that will take ₹20 lakh to ₹1 crore in the coming 10 years.
Why ₹20 Lakh to ₹1 Crore is a Realistic Goal
At first glance, the envisaged growth of ₹20 lakh into ₹1 crore seems a monstrous task. However, with the right portfolio mix and the help of compounding interest, this common goal can very surely be reached. The main thing, therefore, is to put the focus on a long-term and systematic approach to investments. It doesn’t matter whether you are in your early 30s or approaching mid-life; this program helps you accumulate wealth while taking care of other crucial life responsibilities: a spouse, children, and perhaps even aging parents.
How to make the right investment plan?
- Long-term investment objectives: Don’t invest your money just to make short-term compensation; build a long-term outlook.
- SIP: SIP should be in place for stock and mutual fund investments on a regular basis. This will cushion the blows against risk and stabilize the returns.
- Emergency funds: Maintain a separate account wherein the money amounts to the first 6 months of expenses. In case of an emergency, you don’t want to be selling off any investments once the market dips with losses.
- Diversification: The portfolio needs diversifying; investing in gold, bonds, and real estate should not be confined to stocks and crypto only.
How ₹20 lakh will become ₹1 crore
If you get an average return of 12-15% per annum on your investments, then your ₹20 lakh can directly turn into ₹1 crore in the next 9-10 years. Let’s understand this in a better way:
At 10% annual return
| Monthly SIP | Calculations | Time to reach ₹1 crore |
|---|---|---|
| ₹10,000 | ₹20 lakh + SIP (10% return) | 13 years |
| ₹20,000 | ₹20 lakh + SIP (10% return) | 10 years |
| ₹30,000 | ₹20 lakh + SIP (10% return) | 9 years |
At 12% annual return
| Monthly SIP | Calculations | Time to reach ₹1 crore |
|---|---|---|
| ₹10,000 | ₹20 lakh + SIP (12% return) | 11 years |
| ₹20,000 | ₹20 lakh + SIP (12% return) | 9 years |
| ₹30,000 | ₹20 lakh + SIP (12% return) | 8 years |
| Monthly SIP | Calculations | Time to reach ₹1 crore |
|---|---|---|
| ₹10,000 | ₹20 lakh + SIP (10% return) | 13 years |
| ₹20,000 | ₹20 lakh + SIP (10% return) | 10 years |
| ₹30,000 | ₹20 lakh + SIP (10% return) | 9 years |
At 12% annual return
| Monthly SIP | Calculations | Time to reach ₹1 crore |
|---|---|---|
| ₹10,000 | ₹20 lakh + SIP (12% return) | 11 years |
| ₹20,000 | ₹20 lakh + SIP (12% return) | 9 years |
| ₹30,000 | ₹20 lakh + SIP (12% return) | 8 years |