We all want to have so much money in our bank account that we don’t have to worry about our children’s education, marriage or our retirement. Rs 50 lakh is a huge amount, which is not easy for any working person to deposit in one go. But, if I tell you that you can easily achieve this with small savings, then? Yes, it is possible with the power of SIP (Systematic Investment Plan) and compounding. If you are aiming for 15 years, then equity mutual fund can turn your dream into reality. Come, without any complicated mathematics, let us understand how much money you will have to withdraw from your pocket every month. Think beyond bank FD: Equity is the right path. Experts clearly say that if you are adding money for 10-15 years, then bank FD (Fixed Deposit) or RD (RD) will not give the returns which can beat inflation. Could. Equity schemes of mutual funds have always given better returns in the long run. The reason is clear – here the magic of ‘Compounding’ works, that is, you get “interest on interest”. Simple mathematics of making 50 lakhs (SIP Calculator) Suppose you need 50 lakh rupees in your hand exactly 15 years from today. So how much SIP should you start today? It depends on the returns the market gives you. If you get 12% returns: If we assume an average return of 12% (which equity funds give in the long run), then you will have to invest only Rs 10,008 every month. If you get 10% returns: If you are playing a little safe and assume 10% returns, then you will have to invest only Rs 10,008 per month. You will have to deposit Rs 12,063. If you get 9% return: Even if the return is less (9%), then you will deposit Rs 50 lakh with the savings of Rs 13,213 per month. Result: The more risk you take and invest money in a good fund and the more return you get, the less will be lost from your pocket. According to 12%, you will deposit a total of Rs 18 lakh from your pocket in 15 years, and the remaining Rs 32 lakh is only ‘interest’. And profits will be made. This is called the magic of compounding! What to do if you don’t have Rs 10,000 yet? (There is also Jugaad) Many people will have a question in their mind that “My salary is less, how can I save Rs 10,000?” So the answer is – Step-up SIP. You start with a small amount (like Rs 5000). Then as your salary increases every year, increase your SIP amount by 10%. If you keep doing this with discipline, then a bigger fund will be created than even Rs 50 lakh. Just remember 3 things. There is no shortcut to becoming a millionaire, just follow these 3 rules: Start early: Those who say ‘I will do it tomorrow’ are always left behind. Discipline: Whether the market goes up or down, do not stop your SIP. Patience: Money takes time to become a tree, give it time.