Although SIPs come with market risks, these risks diminish over the long term. (Representative/Shutterstock)

In today’s financial climate, the dream of becoming a millionaire seems elusive for many, primarily due to a lack of clear direction and guidance. However, contrary to popular belief, building wealth doesn’t require a large initial amount.

A simple monthly investment through Systematic Investment Plans (SIPs) of just Rs 100 can build a substantial corpus over time.

How Much Does a Rs 100 Monthly SIP Grow Into?

The concept might appear modest, but the strength of SIP lies in its simplicity, regularity, and minimal initial investment. Over the years, even a tiny monthly contribution of Rs 100 can grow significantly, leveraging the power of compounding.

For instance, if one invests Rs 100 per month for 25 years at an approximate annual return of 12%, they will accumulate around Rs 1,40,221 in interest, bringing the total return to Rs 1,70,221.

This straightforward calculation demonstrates how one can achieve millionaire status with disciplined, long-term investing.

How Compounding Helps Money Grow

SIP works on the principle of compounding, where one’s monthly fixed amount is invested into mutual funds. With time, these small amounts can snowball into a significant fund.

To illustrate, if one consistently invest Rs 100 every month for 25 years, their total investment of Rs 30,000 can grow to roughly Rs 1,89,000 at a 12% annual return.

Even if the return rate is 10%, the fund will be approximately Rs 1,18,000, and with a 14% return, it can soar to around Rs 2,92,000.

Long-Term Investment Brings Better Returns

Long-term investments offer substantial benefits as compounding steadily magnifies returns. Starting with Rs 100 and gradually increasing the monthly amount to Rs 500 or Rs 1,000 can help build a corpus of lakhs within 10–15 years.

Although SIPs come with market risks, these risks diminish over the long term, boosting the likelihood of favourable returns.

Moreover, this disciplined approach to regular investment fosters a saving habit and gradually creates a robust financial fund. The true power lies not in the initial amount but in consistent investing and the passage of time, embodying the magic of compounding that can transform small investments into significant wealth.