SIP Calculator: Monthly Plan Needed to Build ₹5 Crore in 20 Years

Many investors view the ₹5 crore mark as an ambitious and distant milestone, often associated with retirement planning or long‑term wealth creation. The figure appears challenging at first glance, creating uncertainty about whether it can be achieved through disciplined investing.

The suspense builds as we try to find out what monthly investment is required to reach such a target in 20 years. As the numbers unfold, the path becomes clearer as we use the SIP Calculator to understand the power of compounding.

The Target Corpus and Required Monthly SIP

The financial goal under consideration is a corpus of ₹5,00,48,318 built over 20 years. At an assumed CAGR of 12%, the monthly SIP needed to achieve this target is ₹50,092.

The figure may seem sizeable initially, but it reflects the long‑term benefit of consistent contributions. The required SIP demonstrates that investing steadily over two decades can transform moderate monthly amounts into significant wealth.

Understanding The Effect of Compounding Over Time

Compounding plays a central role in converting regular monthly contributions into a large final corpus over 20 years. In the initial years, portfolio growth appears modest because contributions form most of the invested amount.

Between years 6 and 14, compounding accelerates as returns begin contributing a higher share to total value. In the final five years, the effect intensifies significantly, with returns generating returns and producing exponential growth.

Contribution And Returns Breakdown

A monthly SIP of ₹50,092 over 20 years results in total contributions amounting to ₹1,20,21,840. With a 12% CAGR, the estimated returns accumulate to ₹3,80,26,478.

This breakdown shows that the majority of the final corpus is driven by compounding rather than direct contributions. The data highlights how long‑term investing leverages time to increase return contributions.

The Impact of Delays and Return Variations

Delaying the start of the investment by even 5 years raises the required monthly SIP sharply for the same target. A reduced compounding duration places greater reliance on larger contributions.

The variations in returns also influence outcomes, as a lower CAGR, such as 10% may not achieve the target, whereas a higher CAGR of 14% may exceed it. These sensitivities reinforce the importance of maintaining consistent long‑term investments.

Read More: EMI for a ₹7 Lakh Wedding Loan Over 5 Years.

Conclusion

The required SIP of ₹50,092 per month demonstrates that a ₹5 crore corpus is attainable over 20 years with disciplined investing. Compounding plays a dominant role, contributing roughly three‑quarters of the final corpus.

Delays in investing or variations in returns can change outcomes significantly, underscoring the importance of time in wealth creation. The structured analysis shows how a consistent approach can build sizeable long‑term financial outcomes.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. This does not constitute a personal recommendation/investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.

Investments in the securities market are subject to market risks, read all the related documents carefully before investing.