How to become Crorepati by investing Rs 1,200 per month in mutual funds?

How to become Crorepati by investing Rs 1200 per month in mutual fundsHow to become Crorepati by investing Rs 1,200 per month in mutual funds?


Many individuals would dream to become Crorepati. However, only few would plan and achieve. While there are several investment options like stocks, company FD schemes, NCD’s, Bank FD schemes, all these are either high risk options or provide low returns. However, mutual funds on other hand can help you to grow your small investments into Lakhs and Crores. Do you know that small investment of Rs 1,200 per month can make you Crorepati? You DONT need lakhs of rupees of investment to be done to make it Crorepati. It just requires small savings, plan well and invest wisely. In this article, I would provide details about how to invest in mutual funds to become Crorepati with such small investments. I would also recommend top mutual funds where one can consider to reach this goal.

How people dream to become Crorepati?


how to become crorepati by investing in mutual funds-investors scaredCrorepati = 100 Lakhs. Many of us first start earning money, do small savings and then try to make several lakhs and then become Crorepati. However, several investors struggle looking for various investment options. Some invest in stocks and burn their fingers. Some invest in company FD schemes and complain that their capital is not returned by companies. End of the story, they lose money. Investors can plan well and invest in right investment option where they need not worry with day to day stock market fluctuations. One of the efficient ways to become Crorepati is investing in mutual funds which would reduce all such day to day risks. 

Also Read: Top 15 Killer Mutual Funds to invest in India now

Why Mutual funds?


Mutual fund schemes pool money from investors and invest in stocks. Fund manager takes decisions about investing in particular stocks. Some mutual fund schemes do well and gain popularity and investors pump more money and AUM increases for such funds. Investing in a good mutual fund scheme is tough. It is also an art of identifying good schemes.

How much to invest per month in mutual funds to become Crorepati?


how to become crorepati by investing in mutual funds-but how muchMutual fund schemes provide good returns in long term. One can consider an average annualized return of 12% to compute the wealth that can get accumulated in long run if one is ready to invest money every month through SIP.

If you are at 30 years age and want to become Crorepati at 60 years age (30 years tenure), you just need Rs 1,200 per month and increasing such investment by 10% year on year. Means, first year you would invest Rs 1,200 per month and from 2nd year you would invest Rs 1,320 (1200 + 120) per month and so on.

If you are at 35 years age and want to become Crorepati at 60 years age (25 years tenure), you just need Rs 2,400 per month and increasing such investment by 10% year on year. Alternatively, if you want to become Crorepati in 25 years irrespective of your age, just invest this amount.

If you are at 40 years age and want to become Crorepati at 60 years age (20 years tenure), you just need Rs 5,000 per month and increasing such investment by 10% year on year. Alternatively, if you want to become Crorepati in 20 years irrespective of your age, just invest this amount.

If you are at 45 years age and want to become Crorepati at 60 years age (15 years tenure), you just need Rs 11,600 per month and increasing such investment by 10% year on year. Alternatively, if you want to become Crorepati in 15 years irrespective of your age, just invest this amount.

If you are at 50 years age and want to become Crorepati at 60 years age (10 years tenure), you just need Rs 30,000 per month and increasing such investment by 10% year on year. Alternatively, if you want to become Crorepati in 10 years irrespective of your age, just invest this amount.

Also Read: Best Tax Saving Mutual Funds to invest in India

How to become Crorepati by investing Rs 1,200 per month in mutual funds?


Once you identify your age or tenure of investment to become Crorepati, now you need to identify good mutual fund schemes which can take you to that goal. Ideally you can select 3-5 mutual fund schemes and invest through SIP every month. If you are investing Rs 1,200 per month through SIP, invest in 2 good schemes. If you are investing Rs 10,000, select 3-5 mutual fund schemes. Here are the schemes one can focus about.

Top#1: Birla Sun Life Frontline Equity Fund (Large cap fund)


Fund Objective: This mutual fund scheme aims to generate long term growth of investment, through a stock portfolio with a target allocation of 100% equity aiming at being as diversified across various industries and or sectors.

Fund Performance: This fund has beaten all its peers and provided 18% annualised returns in last 5 years and 13% annualized returns in last 10 years.

Why to invest: Good performance has lead to asset size hitting Rs 12,000 Crores. Stead Management has led to continuity of style and market bias. Fund performed well in bull markets and reduced losses during bear markets. This fund beats all its peers and provided 18% annualised returns in the last 5 years compared to the S&P BSE 200 benchmark of 13% in a similar period. Crisil ranks it as Rank-1 and Value Research Online (VRO) as 5-Star (5 out of 5). This is one of the best SIP mutual funds to invest for long term to become Crorepati.

Top#2: ICICI Pru Top 100 Mutual Fund (Large cap fund)


Fund Objective: This mutual fund scheme aims to generate long term capital appreciation by investing predominantly i.e. up to 95% in equities while the rest would be invested in debt and money market instruments.

Fund Performance: This fund has beaten all its peers and provided 17.2% annualised returns in last 5 years. Even in the long run for 10 years, it gave 11% annualized returns providing this as a consistent performer in the long run..

Why to invest: This fund beats all its peers and provided 17% annualised returns in the last 5 years compared to its benchmark of 16% in a similar period. Crisil ranks it as Rank-2 and Value Research Online (VRO) as 3-Star (3 out of 5). Another good mutual fund to invest for achieving Crorepati goal.

Top#3: Franklin India Smaller Companies Fund (Midcap/small cap fund)


Fund Objective: This mutual fund aims to generate long-term capital appreciation from a portfolio of mid-cap and small-cap companies. It invests up to 75% in smaller capitalization companies.

Fund Performance: This fund has beaten its benchmark and provided 31% annualised returns in last 5 years. Even in long run of 10 years, this fund provided 15% annualized returns.

Why to invest: This fund differentiates itself from market cap orientation. This fund invests smaller portion in large cap and invests a sizeable amount in small companies, hence it can be termed as smaller stock fund. This fund performed excellent in last 5 years and given 31% annualised return compared to its benchmark of 11%. Crisil Ranks it as Rank-1 and Value Research Online as 4-Star (4 out of 5). This is one of the best small cap funds to invest for long term.

Top#4: DSP BlackRock Micro Cap Mutual Fund (Midcap/small cap fund)


Fund Objective: This mutual fund aim is to seek long-term capital appreciation by investing in a stock portfolio that are not part of the top 300 companies by market capitalization. The focus of the scheme is to deliver superior long term performance by selecting stocks of companies those are uncorrelated to broader markets & not sector specific.

Fund Performance: This fund has beaten its benchmark and provided 32% annualised returns in last 5 years.

Why to invest: This is a top small-cap fund that has beaten its benchmark for last eight years from 2008. This fund performed excellent in last 5 years and given 32% annualised return compared to its benchmark of 26%. Crisil Ranks it as Rank-1 and Value Research Online as 4-Star (4 out of 5). This is one of the top SIP mutual funds to become Crorepati in long term.

Also Read: 10 Best SIP Mutual Funds to invest in India in 2017

Top#5: ICICI Balanced Mutual Fund (Balanced Fund)


Fund Objective: The scheme invests in equities and related securities as well as fixed income and money market securities. It invests 60% minimum in equity and balance in debt related instruments.

Fund Performance: This fund has beaten its benchmark and provided 20% annualised returns in last 5 years. Even in last 10 years, this fund gave 12% annualized returns.

Why to invest: This fund performed well in last 10 years and given 12% annualised return comparing to balanced fund category of 10%. Crisil ranks it as Rank-3 and Value Research Online (VRO) as 4-Star (4 out of 5 stars). It would reduce risk by investing part of the investment in debt instruments, hence good to have such funds for portfolio balancing. This is one of the Best SIP Mutual funds to invest in the balanced fund category to become Crorepati.

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Suresh

How to become Crorepati by investing Rs 1,200 per month in mutual funds

52 comments

  • akhil

    Hi,

    I would like to invest some money in Mutual funds..

    As of now no TDS detection for me, and I am 22 years old.     

    I can afford Rs 3000 in a month for investments.

    So, please suggest me some good mutual fund schemes…

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