Financial independence and stability are the most sought-after goal in the present times, given that one needs to build their wealth for surviving future emergencies smoothly. Even if it’s not for extreme situations, individuals need to build a strong financial corpus for retiring early or finding their dreams.
Either way, the key to this is only one-investment and ideally, long term investment. Depending on one’s risk bearing ability as well as tenure, he/she can choose the mode of investing they want to go for, in order to inch closer to aforesaid goals. One of the popular methods at present is with the help of mutual funds. These are pooled in funds from various investors that AMCs invest directly in stocks, bonds or other securities and share the returns with investors after making necessary adjustments on account of total expenses. If one wants to start investing regularly, systematic investment plan or SIP happens to be an ideal option.
Investment & SIP
SIP can be a good start for to set foot in the world of investments and start moving towards financial goals. For aiding this process, online tools such as the SIP Calculator can be very helpful. It will ask for simple inputs such as the SIP amount, SIP frequency (daily, monthly, quarterly), the SIP period and assumed rate of return. This helps to estimate the future corpus that an investor can expect to accumulate with disciplined investing and patience.
For instance, if Vijay is investing Rs. 20,000 monthly through SIP, for 12 years period and expects to accumulate a corpus of Rs. 64 lakhs, assuming the return to be 12% annual. In this case, the amount invested by him over 12 years is more than Rs 28 Lakhs. Therefore, the SIP calculator helps him in understanding how much he should keep aside from his monthly salary or allowance, to invest for attaining his financial goals.
Investment & Retirement
Another way of using mutual funds is by planning your retirement. The earlier you start planning, the better it is as the investment tenure increases, giving more space for growth of your wealth. This means that power of compounding works magic in the long term, thus multiplying your money and giving you a substantial future corpus to work with.
In this regard, we need to highlight a useful tool called the retirement calculator India. This is an online financial calculator available for retail investors. As the name suggests, one can make a potential retirement plan with this tool and execute it with investments of their choice. First, depending on your lifestyle, income, tenure of investment, you need to decide the corpus you would ideally need when you retire to lead a comfortable life. Then, this tool will tell you in knowing how much to invest today for reaching this corpus systematically. Let us understand this with an example:
Suppose, Raj who is 30 years old, wants to achieve a retirement corpus of Rs 5.00 Crore when he reaches the age of 60. Let us assume that he has no savings currently, inflation is 5% and the rate of return is 12% p.a. Then, based on the calculations arrived at by using the retirement calculator India, we understand that Raj should ideally be saving Rs. 62,000 monthly. Hence, he can execute this with monthly SIP investments of the same amount.
SIP Calculator and retirement calculator India are two user friendly online tools that can assist investors in better and sound financial planning.