You may be familiar with SIPS (systematic investment planning). This is a way to regularly invest a fixed amount in mutual funds. Now, imagine that these investments can be increased over time. That’s where Step Up SIP comes in. Step-up allows you to increase your investments at regular intervals by fixed percentages or amounts. In that memo, compare Rs 14,000 SIP with Rs 10,000 step-up SIP and find out what you can build a higher corpus in 10, 20 and 30 years.
What is Step Up SIP?
Stepping up in a systematic investment plan (SIP) allows you to increase your investment contributions by automatically increasing your regular fixed amount or percentage amount, and increase your wealth over time.
SIP vs Step Up SIP
Using regular SIPs will invest a fixed amount each month. This remains constant throughout. In contrast, step-up SIP allows you to increase your investment amount each year at a specified percentage or fixed amount. While regular SIPs are easy to budget, step-up SIPs require a little more planning to accommodate annual increments.
Examples of Understanding Step-Up SIP
For example, starting a SIP of Rs 10,000 per month, you can choose to increase by 5% or 10% after a year.
When do you choose a regular bite?
Consider a regular bite.
You are new to investing and want a simple, consistent plan.
Your income is fixed and won’t increase immediately.
I prefer an easy and hassle-free investment approach.
When do you choose a step-up SIP?
Consider step-up SIP if:
Regular income hikes (such as an increase in annual salary) are expected.
You are planning long-term goals that will require more money over time.
They want to increase their contributions and overcharge their savings.
Rs 14,000 SIP calculation conditions
We expect an annual revenue of 12% of monthly investments of 14,000 over 30 years.
How much can you make a SIP build worth Rs 14,000 per month in 10 years?
In 10 years, the investment amount will be Rs 16,80,000, the estimated capital gains will be Rs 14,56,502, and the estimated retirement corpus will be Rs 31,36,502.
How much can you make a SIP build worth Rs 14,000 per month in 20 years?
In 20 years, the investment amount will be Rs 33,60,000, the estimated capital gains will be Rs 95,18,003, and the estimated retirement corpus will be Rs 1,28,78,003.
How much can you make a SIP build worth Rs 14,000 per month in 30 years?
In 30 years, the investment amount will be Rs 50,40,000, estimated capital gains will be Rs 3,80,93,625, and the estimated retirement corpus will be Rs 4,31,33,625.
Rs 10,000 Step-Up SIP Calculation Conditions
The calculations are made in 12% annual revenue and 8% annual steps.
How much can I build a step-up SIP of 10,000 rupees in 10 years?
In 10 years, the investment amount will be Rs 17,38,388, estimated capital gains will be Rs 12,83,836, and the estimated retirement corpus will be Rs 30,22,223.
How much can I build a step-up SIP of 10,000 rupees in 20 years?
In 20 years, the investment amount will be Rs 54,91,436, estimated capital gains will be Rs 1,04,19,885, and estimated retirement corpus will be Rs 1,59,11,320.
How much can I build a step-up SIP of 10,000 rupees in 30 years?
In 30 years, the investment amount will be Rs 1,35,93,985, estimated capital gains will be Rs 4,99,10,613, and estimated retirement corpus will be Rs 6,35,04,599.
Please read again: Top Performance Mid Cap Mutual Fund with the Best SIP Returns: Rs 25,000 per month to No.1 Fund has grown to Rs 60.18 over 7 years
