Mutual funds have become a popular investment option among people looking to grow their wealth.
And with the right strategy and discipline, one can reap significant benefits over the long term.
If you’re looking to accumulate Rs 1 crore, there’s a simple formula that you can follow, and it’s called the 15x15x15 rule.
What is the 15x15x15 Rule of Mutual Funds?
The 15x15x15 rule involves investing Rs 15,000 every month for 15 years in a fund that gives 15% annual returns.
This means that you’ll need to invest Rs 500 every day for 30 days of the month, and this investment will have to be made for 15 years.
This is very simple yet powerful rule of finance.
By following this rule, you can accumulate Rs 1 crore in 15 years.
SIP and Compounding Benefits
SIP or Systematic Investment Plan is a great way to invest in mutual funds as it helps you get compounding benefits over the long term.
Most mutual fund SIP investors opt for a long-term investment approach.
By investing Rs 15,000 every month for 15 years in a stock giving a 15% annual return, you can accumulate a fund of Rs 1,00,27,601.
This means that by investing just Rs 27 lakh in 15 years, you can earn a profit of Rs 73 lakh through compounding.
What is Compounding?
Compounding refers to the process of earning interest on your interest, which allows your investment to grow exponentially over time.
By following the 15x15x15 rule and investing just Rs 500 a day, you can take advantage of the power of compounding and achieve your financial goals.
Conclusion
Investing in mutual funds through SIP can be a smart way to grow your wealth over the long term.
By following the 15x15x15 rule, you can become a crorepati in just 15 years. So, if you haven’t started investing in mutual funds yet, now is the time to do so and make your money work for you.
