Grow Your Money With SIP: Turn ₹1.5 Lakh Into ₹18.8 Lakh

S SINGH

4 months ago

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Grow Your Money With SIP: Turn ₹1.5 Lakh Into ₹18.8 Lakh

In today’s financial world, investing wisely can help you achieve your dreams faster – whether it’s buying a house, funding your child’s education, or retiring early. While traditional savings methods like fixed deposits offer low returns, Systematic Investment Plans (SIPs) are emerging as a powerful way to grow wealth in India.

According to PolicyBazaar, even a modest annual investment of ₹1.5 lakh for 5 years can grow to nearly ₹18.8 lakh under certain plans. With the right strategy and high-growth mutual funds, disciplined investors can potentially grow their investments up to ₹18 lakh or more over time.

Let’s break down how you can use SIPs to grow your money, what plans and funds to consider, and whether your money is safe.

What is SIP and Why is it Popular?

A Systematic Investment Plan (SIP) allows you to invest a fixed amount in mutual funds at regular intervals (monthly, quarterly, or yearly). Instead of making one large investment, you contribute smaller amounts, making it easier to manage and less risky during market fluctuations.

Benefits include:

Disciplined saving habit
Flexibility to start small (₹500 per month)
Compounding effect for long-term growth
Rupee-cost averaging, reducing market timing risk

Unlike fixed deposits or recurring deposits, SIPs have the potential to generate higher returns, especially when invested in equity mutual funds.

PolicyBazaar Example: ₹1.5 Lakh Yearly SIP for 5 Years

PolicyBazaar highlights a plan where an investor contributes ₹1.5 lakh per year (₹12,500 per month) for 5 years. At the end of the tenure, based on the plan’s performance, the maturity amount can reach approximately ₹18.8 lakh, depending on market conditions.

How Does It Work?

You choose a mutual fund or investment-linked plan through PolicyBazaar.
Contribute ₹1.5 lakh annually for 5 years.
Your money is invested in a mix of equity and debt instruments.
Returns vary based on market performance and the specific plan selected.

While the plan can grow your capital, it’s important to understand that returns are market-linked, meaning they can fluctuate.

Can SIP Turn ₹1.5 Lakh into ₹18.8 Lakh?

Yes, but not overnight. With consistent contributions and time, SIPs can grow significantly due to compounding.

Let’s consider an example:

You invest ₹1.5 lakh per year (₹12,500 per month) for 10 years.
Assuming an average 12% annual return (common in equity mutual funds), your total investment of ₹15 lakh can grow to approximately ₹28–30 lakh.

Even if you scale down the horizon:

For 5 years at 12% returns: ₹7.5 lakh invested can grow to nearly ₹11–12 lakh.
For 15 years: ₹22.5 lakh invested can grow close to ₹50 lakh.

Thus, with consistent investments and time, reaching ₹18.8 lakh in 5 years (or more over time) is realistic, especially with high-growth equity funds.

Is SIP Risk-Free?

This is one of the most common questions investors ask: “Will my money sink in a SIP?”

The answer is:

SIPs themselves are not risky because they are just a method of investing.
The risk depends on the type of mutual fund you choose:
- Equity Funds: Higher risk but higher returns (best for 5+ years).
- Debt Funds: Low risk, moderate returns (better for short-term).
- Hybrid Funds: Balanced risk and return.

While SIPs can show negative returns in the short term due to market volatility, long-term investors (5–10+ years) usually see significant positive returns.

Grow Your Money With SIP: Turn ₹1.5 Lakh Into ₹18.8 Lakh

Best High-Growth Funds for SIP (2025)

For those willing to take some risk for higher returns, here are a few high-growth equity mutual funds (as per recent market performance and analyst suggestions):

Axis Bluechip Fund (Direct – Growth):
- Focuses on large-cap companies.
- Good for long-term wealth creation.
Mirae Asset Large Cap Fund:
- Diversified portfolio with steady growth potential.
Parag Parikh Flexi Cap Fund:
- Invests in Indian and global stocks, providing wider exposure.
SBI Small Cap Fund:
- High risk, high return; ideal for aggressive investors.
HDFC Mid-Cap Opportunities Fund:
- Targets mid-sized companies with growth potential.

Note: Returns are not guaranteed. Always check the latest performance, ratings (like CRISIL or Morningstar), and your risk appetite before investing.

Grow Your Money With SIP: Turn ₹1.5 Lakh Into ₹18.8 Lakh

Monthly vs Yearly Investment: Which is Better?

Monthly SIP:
- Easy to manage (start with ₹500–₹5,000).
- Reduces risk through rupee-cost averaging.
- Best for salaried individuals.
Yearly Investment (Lump Sum):
- Suitable if you get a bonus or have extra cash.
- Can generate better returns if markets rise, but carries more timing risk.

Most experts recommend monthly SIPs for consistent, stress-free investing.

Grow Your Money With SIP: Turn ₹1.5 Lakh Into ₹18.8 Lakh

How to Start a SIP in 2025

Set a Goal: Are you investing for a house, education, or retirement?
Choose Your Fund Type: Equity for long-term, debt for safety, hybrid for balance.
Pick an Amount: Start with ₹500 or ₹1,500 per month; increase as income grows.
Complete KYC: Submit PAN, Aadhaar, and bank details online.
Automate It: Set up auto-debit for hassle-free investing.
Track Growth: Use a SIP Calculator to estimate future returns.

Grow Your Money With SIP: Turn ₹1.5 Lakh Into ₹18.8 Lakh

Example: Building Wealth with SIP

Let’s say you invest ₹12,500 per month (₹1.5 lakh per year) in a mutual fund with 12% average returns.

In 5 years: ₹7.5 lakh invested → grows to ~₹18.8 lakh (32.5% return, based on PolicyBazaar’s projection).
In 10 years: ₹15 lakh invested → grows to ~₹28–30 lakh.
In 15 years: ₹22.5 lakh invested → grows to ~₹50 lakh.

This demonstrates how even a moderate contribution can grow significantly over time.

Grow Your Money With SIP: Turn ₹1.5 Lakh Into ₹18.8 Lakh

Why SIPs Are Perfect for Indian Investors

You can start small (₹500/month).
Flexible – you can pause, increase, or stop anytime.
Historically, good equity funds have beaten inflation and delivered better returns than fixed deposits.
Encourages financial discipline, making saving a habit.

Grow Your Money With SIP: Turn ₹1.5 Lakh Into ₹18.8 Lakh

Final Thoughts

SIPs are not a get-rich-quick scheme, but they are one of the most effective ways to build wealth systematically. By investing ₹1.5 lakh annually in a good SIP for several years, you can easily achieve goals like building a corpus of ₹18.8 lakh in 5 years and much more in the long term, depending on your timeline and fund performance.

While SIPs involve market-linked risks, staying consistent, choosing quality funds, and investing for the long term can help you build a solid financial future.

👉 Start your SIP today and use a SIP Calculator to see how your investments can grow.

Grow Your Money With SIP: Turn ₹1.5 Lakh Into ₹18.8 Lakh

Disclaimer:

Mutual fund investments are subject to market risks. Returns are not guaranteed and may vary based on market conditions. Always research or consult a financial advisor before investing. Past performance is not indicative of future results.