SIP of ₹40,000 per Month for 6 Years
Complete compounding breakdown for a Systematic Investment Plan (SIP) of ₹40,000 monthly over a 6-year investment horizon.
Returns Across Different Asset Classes
| Asset Class / Style | Expected CAGR | Total Invested | Estimated Returns | Maturity Corpus |
|---|---|---|---|---|
| Bank Recurring Deposit (RD) | 6.5% | ₹2,880,000 | +₹649,864 | ₹3,529,864 |
| Public Provident Fund (PPF) | 7.1% | ₹2,880,000 | +₹718,858 | ₹3,598,858 |
| Conservative Hybrid Funds | 8.0% | ₹2,880,000 | +₹825,553 | ₹3,705,553 |
| Large Cap / Nifty 50 Index | 10.0% | ₹2,880,000 | +₹1,077,156 | ₹3,957,156 |
| Diversified Equity (Flexi Cap / Multicap) | 12.0% | ₹2,880,000 | +₹1,350,281 | ₹4,230,281 |
| Mid Cap / Small Cap Funds | 15.0% | ₹2,880,000 | +₹1,804,782 | ₹4,684,782 |
Year-by-Year Wealth Accumulation Schedule (@ 12% CAGR)
| Timeline | Invested Principal | Growth / Gains | Total Corpus Value |
|---|---|---|---|
| Year 1 | ₹480,000 | +₹32,373 | ₹512,373 |
| Year 2 | ₹960,000 | +₹129,728 | ₹1,089,728 |
| Year 3 | ₹1,440,000 | +₹300,306 | ₹1,740,306 |
| Year 4 | ₹1,920,000 | +₹553,393 | ₹2,473,393 |
| Year 5 | ₹2,400,000 | +₹899,455 | ₹3,299,455 |
| Year 6 | ₹2,880,000 | +₹1,350,281 | ₹4,230,281 |
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Frequently Asked Questions
How much will ₹40,000 invested monthly in SIP become after 6 years?
At a standard historical equity index return of 12% CAGR, a monthly SIP of ₹40,000 for 6 years generates a maturity corpus of approximately ₹4,230,281 against an invested principal of ₹2,880,000, earning a wealth gain of ₹1,350,281.
What is the tax on the returns of ₹40,000 SIP after 6 years?
Under Section 112A (revised post-Budget 2024), Long Term Capital Gains (LTCG) from equity mutual funds held for more than 12 months are tax-exempt up to ₹1.25 Lakh per financial year. Profits exceeding ₹1.25 Lakh are taxed at flat 12.5%. For this scenario, estimated tax is ₹153,160, leaving a net post-tax maturity value of ₹4,077,121.
How does an equity SIP compare to a Bank Recurring Deposit (RD)?
In a Bank RD at 6.5% interest, your total corpus would be ₹3,529,864. An equity SIP at 12% delivers ₹4,230,281, generating ₹700,417 in extra wealth due to compounding power.
What will be the real purchasing power of the corpus after inflation?
Assuming an average inflation rate of 6% over 6 years, the purchasing power of your ₹4,230,281 maturity corpus will be equivalent to approximately ₹2,982,181 in today's money.
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