It's Time: For Beginners To Get Their Basics Right, Know How To Become A 'Crorepati' With 15*15*15 Rule?
Who doesn't want to be a crorepati? To be one is a dream for everyone on earth, right? and everyone wants to do this as soon as possible. So here we are with yet another edition of our #It's Time series, where we will discuss how beginners can learn to invest in these changing times and let their money grow.Well, now that we have made up our minds to grow our money, proper research on the 15*15*15 rule? in mutual funds is the technique that will enhance our chances of achieving a corpus of Rs 1 crore.?
15*15*15 Rule: Is For Beginners To Get A Basic Idea Of How To Invest?
According to this rule, one must invest Rs. 15,000 every month for 15 years in a mutual fund that is predicted to earn 15% returns. According to compound interest estimates, the investor will get Rs. 1 crore after 15 years.This simple yet brilliant mutual fund investing principle may help you calculate how much you need to save each month, how much time you need to put into saving, and what rate of return and growth to expect and accumulate in order to attain your Rs. 1 crore target.Before getting deeper into the 15*15*15 rule, let us explain the importance of the power of compounding, which is interlinked with the rule.
Power And Role Of Compounding?
For mutual fund investments, compounding refers to a phenomenon that causes modest funds to rise to a substantial corpus when invested over time. In other words, the returns you make in one compounding period will generate returns in the next, and so on.?
For Example: If one decides to invest Rs. 15,000 each month for 15 years in a mutual fund, then that is predicted to earn 15% returns. According to compound interest estimates, one will earn Rs. 1 crore after 15 years. When the same compounding concept is employed for another 15 years, the entire corpus grows exponentially to Rs. 10 crore.When you invest in mutual funds, you choose to commit time as well as money. It also represents the concept that time is money when invested properly.?
With a long-term investing view, you may use the 15x15x15 rule to develop a progressive portfolio and seek to become a crorepati.The rule is a rudimentary way of getting you started on long-term savings. If you are content with a 12% annualised return, you may employ step-up SIP to build a larger corpus. Ideally, one should compute inflation-adjusted amounts to save towards the specified objective before beginning to save for it.?
Bonus Tip: Calculate the inflation-adjusted amount to save for the specified goal and then begin saving for it.?
How It Can Help?
The 15-15-15 mutual fund rule considers two important factors: the SIP style of investing and compounding, which works in the investor's favour. Following the 15-15-15 mutual fund investment guideline instills a saving habit. As units are acquired through SIP, it helps keep volatility under control. There is no incentive to time the market; instead, more money may be added to the same SIP portfolio as and when the market falls precipitously.?
Well, we hope this financial rule for growing money helps you in the future, and with that, we wish you happy saving and happy investing!
