Middle class people should make first 1 crore rupees, then 1 to 2, and 2 to 4 crores, it will not take time.

Investment Tips: If you have Rs 1 crore then you will be called rich. Nowadays, millionaires are not considered rich but middle class. If you invest that one crore, you get 15 percent annual return on that investment… then in the next 5 years your money will increase from one to 2 crores. Yes, this is the magic of compounding. If we talk a little further, after having Rs 2 crore, if you get the same returns in the next 5 years, then you will have Rs 4 crore. Meaning Rs 1 crore becomes Rs 4 crore in 10 years. But… the biggest issue is that from where will the middle class get Rs 1 crore to invest?

There is also an answer to this question. According to cleartax.in, if you apply the formula of 15*15*15 in investment, then you can become the owner of Rs 1 crore in 15 years. Let us understand a little about this formula. You have to invest a monthly SIP of Rs 15,000 in a fund. You have to run this SIP for 15 years. If you get returns at the rate of 15 percent annually during this period, then after 15 years you will have accumulated a fund of Rs 1 crore.

Also read – Best Mutual Funds: These 5 schemes made you happy, money doubled in three years

Where do people make mistakes in saving?
It is not that we are telling this formula for the first time. The truth is that investment advisors around the world have been telling people about this for years. You may have heard it too, but never noticed it. Actually, people are not able to manage their earnings properly. This is where the whole math goes wrong. It will be better if we understand this with an example-

Suppose, your monthly earning is Rs 50,000. After getting salary, the first thing you do is separate your essential expenses. Pursue hobbies like shopping, watching movies, eating in restaurants and other things. Then if there is anything left, we invest it. But believe me, investment advisors consider this method very wrong, and common people have been following it for centuries.

So what is the right formula for saving?
If you really want to make money, you will have to change the mathematics of managing your budget. Investment advisors point out that Savings = Income-Expenditure Not there. The correct formula is: Expenditure = Income-Savings, This means that you should first set aside a part of your income for savings. For example, if you want to save Rs 15,000 per month, then invest Rs 15,000 as soon as you get your salary. After that, manage your household expenses with the remaining Rs 35,000.

To manage household expenses, you have to see from where money can be saved. You can cut down on your expenses which will not make any difference to your life. This will be the right preparation for the future. Following this formula, you can invest Rs 15,000 per month. Funds up to Rs 1 crore will be available to you in the next 15 years.

(Disclaimer: Mutual fund investments are subject to market risks, read all scheme documents carefully. If you wish to invest in any fund, please consult a certified investment advisor first. Any profit or loss you may incur AyraNews24x7 will not be responsible for this.)

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