FREEDOM / WISE
Worked Example

How much corpus does a ₹10,000 monthly SIP build over 20 years at 12% CAGR?

Scenario

Rohit, age 30, software professional in Pune, ₹12 lakh annual income, ₹50K monthly expenses, exploring this question for his financial plan

Inputs

Years
20
Inflation %
6
Monthly sip INR
10000
Expected return %
12

Calculation

  1. 1.

    Total invested over tenure

    ₹10,000 × 240 months₹24.00 L

  2. 2.

    SIP future-value factor at given rate and tenure

    [((1+r/12)^n − 1)/(r/12)] × (1+r/12)999.15x

  3. 3.

    Final corpus

    ₹10,000 × 999.15 factor₹99.91 L

  4. 4.

    Wealth multiple on contributions

    ₹99,91,479 ÷ ₹24,00,0004.2x

Conclusion

₹10,000 SIP over 20 years builds approximately ₹1.00 crore — roughly 4× the principal invested through 12% compounding.

Tradeoffs

Assumes 12% steady CAGR; real Indian equity returns vary year-to-year. With 6% inflation, ₹1.00Cr in 20 years has purchasing power of roughly ₹0.31Cr in today's money. Step-up SIP (10% annual) typically adds 25-40% to terminal corpus.

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