How a ₹2,000 Monthly SIP Turns ₹6 Lakh into ₹38 Lakh

Here is the better read. The worst years – the ones where the index falls 15-20% – are exactly when the SIP buys the most units. Those units pay off in the recovery. Missing two months of contributions during a downturn can knock 5-7% off the final corpus, depending on when the recovery hits. Continue the payments through the dips and the average cost of units bought drops.

A step-up SIP boosts the total further. Someone who starts at ₹2,000 and increases the contribution by 10% every year ends with a significantly larger number than the flat SIP example, assuming the same 12% return on the full portfolio.

None of this works if the investor stops the plan during a bear market. The AMFI data on May inflows shows that some people did stop or reduced contributions. The ones who kept going got the compounding effect working for them. The ones who paused broke the sequence.

Mutual fund returns carry market risk. The 12% assumption is an illustrative rate. Past returns do not guarantee future outcomes. Check with a certified financial advisor to match the SIP size and frequency to your own risk tolerance and cash flow.