Can You Reach 50 Lakhs Before 40? Here’s a 5-step Approach

Shruti Sharma - Oct 06, 2022

For the vast majority of us, life is a series of trials that begin the day we enter school. Getting into a good college after high school by earning good grades. The difficulty of finding a good job follows. But the story doesn't end there. Then we compete for roles and greater compensation. The task of building a sufficient financial foundation to support our families' present and future demands comes next.

When it comes to overcoming the difficulty of earning "enough" wealth, the milestones we reach are frequently what determine our success—or lack thereof. Achieving their first crore is one such milestone for many, particularly those working in metro areas with their high cost of living.

Saving significant amounts of money is challenging, to say the least, unless your salary increases extremely quickly. So why not start with a substantial but slightly more manageable objective? Why not make it a challenge while you're at it?

The goal is to accumulate at least Rs 50 Lakh before turning 40. To attain this milestone, you don't have to be particularly young. Even from beginning, all it takes is 108 months, or around 9 years.

Here's how you approach it.

Step 1: Start off by saving at least Rs 20,000 per month.

Step 2: Pick a small number of high-quality equity mutual funds, and don't go by past returns only. Investocafe recommends mutual fund based on their stock portfolio and their scope of growth. Obtain an excellent recommendation from a knowledgeable financial consultant at Investocafe by speaking with them. You are building a portfolio as you go. Spread your investment over 2-3 funds rather than sticking with a single fund.

Step 3: Start a 108-month SIP in the pool of funds you've chosen.

Step 4: Annually increase your SIP contribution by 10%. If you have the money, increase it even more.

Step 5: Throughout these 108 months, remain steadfast and act with conviction, regardless of market ups and downs. You may want to reassess a fund if its performance is subpar for an extended period, but keep your investment in the asset class (equity).

The goal is to accumulate at least Rs 50 Lakh before turning 40. To attain this milestone, you don't have to be particularly young. Even from beginning, all it takes is 108 months, or around 9 years.

What results in the end?

You should achieve your ultimate aim and end up with a final sum of more than Rs 50 lakhs if your portfolio expands at the anticipated rate of development, which is approximately 12% annualised for equities, according to current projections.

Here is how your fortune will increase!

So, what are you waiting for? Get, set, and go!

Calculate Investment Returns here!

Book one free wealth management consultation with Investocafe’s certified advisor.

To get in touch please visit us at investocafe.com