SIP Formula: Today, in the era of inflation, earning money and saving it is no less than a difficult task. In that too, saving lakhs and crores of rupees seems like breaking into Kuber’s treasury. But, this is known to those who do not know the trick of investing and then saving money.
People who know the ways of investing and saving are earning huge income of lakhs. This method of investment is SIP i.e. Systematic Investment Plan. If you invest through this, then in the long run you create a big fund. In that also, if some formulas are used in trick type, then it becomes more beneficial for you. One of these formulas is the formula 11x12x20, after adopting which a person can become the owner of at least Rs 2 crore. Come, let us know how?
What is SIP?
SIP i.e. Systematic Investment Plan is an investment method in which investors deposit a fixed amount in a mutual fund at regular intervals (monthly or quarterly). This method makes investing disciplined and easy. Investing through SIP can provide better returns in the long term by averaging out the fluctuations of the market. It gets the benefit of rupee cost averaging and compounding. It is considered a safe and convenient way to achieve big goals with small investments.
What is a mutual fund?
Mutual fund is an investment instrument in which money of many investors is pooled and invested in shares, bonds, gold or other financial assets. It is managed by professional fund managers, who take investment decisions based on market analysis. Mutual funds provide diversification, which reduces risk and increases return potential. Investors can invest through lump-sum or SIP as per their capacity. It is considered an easy, safe and transparent investment option even for investors with less knowledge.
What is SIP’s 11x12x20?
The 11x12x20 formula of SIP shows that by investing regularly and for a long time, any person can create a fund worth crores. In this, 11 means SIP of Rs 11,000 every month. 12 means an average annual return on investment of 12% and 20 means investing continuously for 20 years. The basis of this formula is compounding, which increases your investment manifold over time. If you continue SIP with discipline without stopping, this formula shows you the path to becoming a millionaire in the long run.
How to earn Rs 2 crore with 11x12x20 formula
If you invest Rs 11,000 in a mutual fund through SIP for 20 consecutive years, then you deposit around Rs 60 lakh in your mutual fund. On the basis of 12% return on this Rs 60 lakh, one can get interest up to Rs 1,69,96,434 in 20 years. Now if you add the principal amount of Rs 60 lakh and the interest amount of Rs 1,69,96,434, then Rs 2,29,96,434, more than Rs 2.29 crore, will be deposited in your account.