SIP Vs RD: If you want to invest your monthly savings instead of investing a lump sum amount, then you have two better options. The first option is Post Office RD, in which your investment will be safe and you will get guaranteed returns. The second option is SIP. Through this, investment is made in mutual funds. This is a market linked scheme, so its returns are also based on the market. In such a situation, if you want to invest ₹ 10,000 every month, then how much benefit will you get? Let’s see.
Post Office RD is for 5 years
You get the option of RD in different tenures in the bank, but if you invest money in Post Office RD, then you will have to invest in RD for 5 years. But you are given a good interest on Post Office RD. Currently, you are getting interest at the rate of 6.7 percent. How much return will you get on investing
If you invest in Post Office RD, then at the rate of Rs 10,000 per month, your investment will be Rs 6,00,000 in 5 years. If you consider the interest rate at the rate of 6.7 percent, then you will get an interest of Rs 1,13,659. In this way, you will get a total of Rs 7,13,659 as maturity amount.
How much money will be made in SIP
If you invest Rs 10,000 every month in SIP for 5 years, then here also your total investment will be Rs 6,00,000 only. The average return of SIP is considered to be around 12 percent. In such a situation, at the rate of 12 percent, you will get Rs 2,24,864 as interest. In this way, after 5 years, you will get a total of Rs 8,24,864.
Better scheme in terms of making money
SIP is undoubtedly a market linked scheme, but it is considered very good in terms of making money. It has less risk as compared to investing directly in shares and in the long term, you get the benefit of compounding as well as rupee cost averaging. In this way, you earn a good profit.
Power to beat inflation
The average return of long term SIP is 12 percent, but if luck favors you, it can be even better. Such return is not available in any other scheme at present. Experts believe that this scheme has the power to beat inflation. The longer you invest in SIP, the more benefit of compounding you get. In such a situation, it is considered a very good scheme in terms of wealth creation.
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