If you asked a 100 people; do you wish to have 10 crores of wealth…?
99.9% would say yes
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99.9% would feel that it’s a fantasy
99.9% would know that they will never make it
99.9% would just laugh!
0.1% or less would believe that this would be possible; then be prepared to do what it takes and in the process be self-motivated without losing hope and confidence and keep the spirit of the belief alive at all times.
That is too much to ask for and I know that; but who said anything worthwhile was ever going to be easy?
Like any great achievement take time and patience so will this objective to fructify. Consider these tables below; in each table we talk of three scenarios viz., conservative where you may consider taking zero risk on investible funds, Moderate where you follow a balanced approach and aggressive where you take full risk knowing that over a really long period of time you can assume to take home a 15% p.a. compounded return. Please note that in this strategy 15% may not happen each year, it may be sub zero to marginal to huge returns in some years. As an average 15% is quite probable and a safe assumption to make.
The figures above tell an interesting tale.
Consider Table A – i.e. a lumpsum investment strategy.
l By taking a conservative approach you would need to invest 713 lacs or 7.13 crores to reach the 10 crore mark if you wish to make this happen in 5 years. If you can let this happen over 15 years you will need 3.6 crores and if you can wait 35 years you will need to deploy 94 lacs now. What is the value of 10 crores 35 years from now – you might ask? Well it will still be quite a sum. However this might be out of reach for most!
l Change strategy to aggressive and you will need 30 lacs to be invested for 25 years and just 8 lacs if you have 35 years in hand! – That sounds achievable or not ?
Consider Table B – i.e. a monthly investment strategy assuming you have no lumpsum now.
l By taking a conservative approach you would need to invest 13.89 or 14 lacs per month crores to reach the 10 crore mark if you wish to make this happen in 5 years. If you can let this happen over 25 years you will need 1.23 lacs invested per month to reach that mark.
l Change strategy to aggressive and you can reach the 10 cr mark in 15 years by investing 1.5 lacs per month or invest 30,000 per month and give yourself 25 years.
l Finally here’s something everyone can do – invest 7000 per month and in 35 years you will be home effortlessly. But note that its 35 years of financial discipline. Easy to say but hard to maintain. Even if you are 40 today surely you can see this happen when you are 75 – it could be left back as an estate.
10 cr Rs may sound big but if this is broken into smaller pieces things can be surprisingly achievable.
TABLE A – Lumpsum (Figures in Rs. Lacs)
Rate of Strategy Duration of Investment (years)
return 5 15 25 35
7% Conservative 713 362 184 94
11% Moderate 593 209 74 26
15% Aggressive 497 123 30 8
TABLE B – Monthly (Figures in Rs. Lacs)
Rate of Strategy Duration of Investment (years)
return 5 15 25 35
7% Conservative 13.89 3.14 1.23 0.55
11% Moderate 12.46 2.18 0.63 0.20
15% Aggressive 11.15 1.48 0.30 0.07
