Now Reading: Rs 10,000 SIP likely to beat Rs 10 lakh FD in 15-year wealth race
-
01
Rs 10,000 SIP likely to beat Rs 10 lakh FD in 15-year wealth race
Rs 10,000 SIP likely to beat Rs 10 lakh FD in 15-year wealth race
A Rs 10,000 monthly systematic investment plan (SIP) could generate a far larger corpus than a Rs 10 lakh fixed deposit (FD) over 15 years, according to a projection by Livemint. Assuming…
The Story in Brief
A Rs 10,000 monthly systematic investment plan (SIP) could generate a far larger corpus than a Rs 10 lakh fixed deposit (FD) over 15 years, according to a projection by Livemint. Assuming a 12% annual return, the SIP would build an estimated Rs 50.46 lakh from a total investment of Rs 18 lakh. In contrast, a Rs 10 lakh FD earning 6.5% annually would yield about Rs 26.3 lakh at maturity. The SIP requires no lump sum and benefits from compounding but carries market risk. The FD offers predictable returns and capital safety. The choice depends on the investor's risk appetite, goals, and time horizon.
The Indian Opinion
The SIP vs FD debate often ignores the real world. The SIP's assumed 12% annual return is no sure bet; equity markets can disappoint for years. Meanwhile, an FD's fixed 6.5% rate is increasingly rare as banks cut deposit rates. The hype around SIPs as a guaranteed wealth machine is overdone. The real test is whether an investor can stomach market swings without panicking and selling low. For a conservative saver, a guaranteed Rs 26.3 lakh may be wiser than chasing an uncertain Rs 50 lakh.
Source: livemint.com
This story was synthesised by AI from the source linked above.
