It is never too early to start planning for your retirement. Taking time to think about your future and consideringall of the financial, lifestyle and health implications can help ensure that you live a comfortable and secure life in your later years.
Having a corpus of Rs. 1 crore when you retire can potentially provide you with the necessary means to live comfortably and enjoy life after retirement. While achieving a retirement corpus of Rs 1 crore is no small task, you can make this goal achievable with careful consideration and by investing wisely in mutual funds.
Mutual funds allow you to invest in stocks, bonds, and other securities based on your goals and risk tolerance. Through careful selection of high-quality funds and regular investments over time, mutual funds give you the opportunity to slowly but steadily accrue your wealth until you reach Rs. 1 crore – giving you financial security, for your retirement planning. Read on to learn how.
SIP or lump sum investment?
You can invest in mutual funds through lump sum and systematic investment plan (SIP). With lump sum investments, you invest a large amount at one time. This allows you to take advantage of market fluctuations and maximise returns over the long term.
SIPs involve making regular investments over time. The amount can be as little as Rs. 500, and you can choose your frequency (weekly, monthly, quarterly, etc.).
How to retire with Rs. 1 crore with lump sum investing?
The first step in making 1 crore with a lump sum investment in mutual funds is to estimate the amount you need to invest. You can do this by using an online lumpsum calculator. Just input the lumpsum investment amount, investment duration, and estimated return rate and get an approximate value of your investment in seconds.
According to the calculator, if you invest Rs 10.37 lakhs lump sum in mutual funds at a 12% rate, you can make 1 crore in 20 years. Similarly, if you want to earn 1 crore in 10 years, then you will have to invest approximately Rs 32.2 lakhs lump sum into mutual funds at a 12% rate of return for 10 years.
How to build a corpus of Rs. 1 crore with SIP investments?
If investing a large lump sum all at once isn’t feasible for you, then you can opt for an SIP. However, planning ahead is essential, so, use an SIP calculator online to figure out how much to invest regularly and for how long to reach your goal. This way, you can set aside predetermined amounts at scheduled times without affecting your current finances.
Using an SIP calculator, you can determine thatwith a 12% return rate, it would take you 20 years to reach Rs 1 crore corpus with a monthly SIP of Rs 10,000. You can even adjust your amount and tenure and input different interest rates to check how different scenarios can get you to the corpus of Rs 1 crore much faster.
Utilise a retirement planning calculator
Retirement planning also requires a detailed analysis of your current status to determine the ideal retirement corpus. To make this process easier, you can use a retirement calculator to estimate the retirement corpus needed to retire comfortably. These retirement calculators consider important elements such as current age and desired retirement age, current income and expenses, and savings or investments details.
With accurate inputs, you can make better strategies such as adjusting income, investing in the best retirement plans and reducing unnecessary expenses to create a corpus of Rs 1 crore to help you sustain a comfortable lifestyle after retirement.
Remember, retiring with a Rs 1 crore corpus is achievable if you start early and invest wisely. The key is to be disciplined with your investments and stay on the course even when markets are volatile. Also, reviewing your progress regularly can help ensure that you remain on track towards achieving your goal.