Author: Hiral Thanawala, CFPCM
“Kaun Banega Crorepati....???” was a question among viewers (common man) which they learnt from none other than Mr. Amitabh Bachahan from his most popular television game show. Common man started realising value of Rs. 1 crore from this show and started dreaming to achieve equivalent or more amount in future. A few were still depended on game show to earn this money whereas smart people started number crunching with their wealth advisors. Their goal was to achieve higher amount than prize money of Rs. 1 crore in span of tenure.
The motive to earn crores in future was staying financially stable by saving small amounts for future consumption. People started realising that this amount would play a vital role to achieve set goals in future. Goals could be children’s higher education, children’s marriage expenses, estate planning, funding in children’s business, enjoying retirement life by taking world tour, vacation home, buying a plot etc.
As there is renowned quote “What you sow so shall you reap......” Here is an illustration given below how early investments will reap benefits in future and fulfil goals / needs of an individual.
Mr. X salaried person starts saving Rs. 200 per day (assuming 30 days in a month). At the end of a month he would have saved Rs. 6000 to invest. This amount should be invested upon his risk capability. He needs to continue with this saving and investing practice till he has achieved amount to fulfil needs / goals.
Age of Investor = 25 years
Retirement age = 60 years
Tenure (span of working years) = 35 years
| Years of investment |
Interest (%) | 20 | 25 | 30 | 35 |
8 | Rs.35,34,122 | Rs.57,06,158 | Rs.89,42,157 | Rs.1,37,63,295 |
10 | Rs.45,56,213 | Rs.79,61,000 | Rs.1,35,62,928 | Rs.2,27,79,828 |
12 | Rs.59,35,532 | Rs.1,12,73,080 | Rs.2,09,69,785 | Rs.3,85,85,757 |
15 | Rs.89,83,437 | Rs.1,94,61,178 | Rs.4,15,39,678 |... [continues]
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(2010, 12). Pursuit to Become Crorepati. StudyMode.com. Retrieved 12, 2010, from http://www.studymode.com/essays/Pursuit-To-Become-Crorepati-534324.html
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