Building a large fund of 2 crore by retirement can seem like a difficult task, but it is achievable with timely investment, which will help avoid financial difficulties in retirement. The calculation assumes an annual return on investments through mutual funds via SIP at a rate of 12 percent.
Scenarios are considered showing what monthly contribution amount is necessary to accumulate a fund of 2 crore by age 60, depending on the age when investing begins.
If a person starts investing at the age of 25, they will need to make monthly contributions of 4000 rupees. By age 60, this contribution will yield 2,20,43,325 rupees, of which 2,03,63,325 rupees will be investment income, and the principal contribution will reach 16,80,000 rupees.
If investing starts at age 30, a monthly contribution of 6500 rupees is required. By age 60, the accumulated amount will be 2,00,26,326 rupees, with investment income reaching 1,76,86,326 rupees.
To achieve the goal of 2 crore at age 35, with a projected return of 12 percent, it is necessary to invest 11,500 rupees monthly. After reaching age 60, the expected capital will be 1,95,75,376 rupees.
If investing starts at age 40, 22 thousand rupees must be contributed monthly to gather a large sum by age 60. Upon maturity, the amount will reach 2,02,36,862 rupees, of which 1,49,56,862 rupees will be received as income.
(Important note: before any investments in stocks or mutual funds, consult a financial advisor.)