In SIP, the long-term returns are so good which is not easily available even in any government scheme giving guaranteed returns. But if you give a booster dose of top-up in it, then your money can grow very fast.

Mutual Fund SIP: Any investor invests in a scheme only after estimating the profit. This is the reason why SIP has become very popular in the past few times. The reason for this is the return on SIP. Through SIP, you invest in mutual funds. Despite being a market-linked scheme, it does not have the risk that is there when you invest money directly in shares.

Apart from this, in SIP, the long-term returns are so good it is not easily available even in any government scheme giving guaranteed returns. According to experts, SIP gives an average return of 12%. But if you give a booster dose of annual Top-Up to SIP, then your SIP can become a rocket and can increase your money very fast year after year. Know here what you have to do for this.

What is the booster dose of Top-Up in SIP?

Usually, when you start a SIP, you invest a fixed amount in it every month. Suppose you started a SIP of Rs 2,000 for 10 years, then you will deposit only Rs 2,000 every month, whether you run it for 5, 10, or 20 years, but Top-Up SIP is such a facility in which you can add some amount to your regular SIP. It can be understood like this that you have chosen the option of monthly SIP of Rs 2,000 at the beginning of your job. As your salary increases every year, you can top-up your SIP every year in the same proportion.

Understand with an example

Suppose you start a monthly SIP of Rs 2,000 and increase the amount by 10% every year. For example, you started a SIP of Rs 2,000 for one year and after the end of the year, you increased it by 10% of Rs 2,000, i.e. Rs 200 and made this SIP Rs 2,200. Next year, you increased it by another 10% of Rs 2,200, i.e. Rs 222 and made this SIP Rs 2,422. In this way, every year you will have to increase the amount of the current SIP amount by 10%.

See how money will grow rapidly year after year

Suppose you start a SIP with Rs 2000 and continue this SIP for 10 years with a top-up of 10%, then your total investment will be Rs 3,82,498, if calculated with an average return of 12 percent, then you will get an interest of Rs 2,92,367 on this and after 10 years you will get a total of Rs 6,74,865. But if you continue this SIP with top-up for 15 years, then the total investment will be Rs 7,62,540, the interest on it will be Rs 9,74,230 and in 15 years you will get a total of Rs 17,36,770.

If you continue investing with this pattern for 20 years, you will invest a total of ₹13,74,600, but will get an interest of ₹26,03,143 at the rate of 12 percent and will get ₹39,77,743 after 20 years. On the other hand, if you continue investing continuously for 25 years, the total investment will be ₹23,60,329, interest will be ₹61,90,763 and after 25 years you will get a total of ₹85,51,092.

Whereas if you run a simple SIP of just 2,000 for 10 years, then you will get a total of ₹4,64,678 in 10 years. You will get Rs 10,09,152 in 15 years, Rs 19,98,296 in 20 years and if you continue running SIP of Rs 2000 for 25 years, you will get a total of Rs 37,95,270.