Every online SIP calculator gives you a number. Almost all of them lie — not in the math, but in the assumptions. They quote 15% annual returns when 11–12% is the realistic equity-fund average net of fees. They ignore inflation, so the ₹1 crore you "need" in 20 years buys what ₹40 lakh buys today. They show you a smooth curve when real returns swing wildly year to year. They make compounding look effortless when the real challenge is behavioural — staying invested through 30% drawdowns.
This guide gives you the honest numbers. Three target corpuses (₹1 Cr, ₹5 Cr, ₹10 Cr), three realistic return assumptions (10%, 12%, 14%), and the SIP amounts that get you there. Plus the step-up SIP math, the inflation truth, and the four assumption mistakes that wreck retirement plans.
The base math (no inflation, no step-up)
Future value of a SIP = P × [((1+r)^n − 1) / r] × (1+r), where P is the monthly SIP, r is the monthly return (annual / 12), and n is months.
You do not need to compute this — the table below does it for you. Monthly SIP required to reach the target, by horizon and annual return assumption:
Target: ₹1 Crore
| Horizon | @ 10% | @ 12% | @ 14% | |---|---|---|---| | 10 years | ₹48,800 | ₹43,500 | ₹38,800 | | 15 years | ₹24,200 | ₹20,000 | ₹16,500 | | 20 years | ₹13,200 | ₹10,100 | ₹7,700 | | 25 years | ₹7,500 | ₹5,300 | ₹3,800 | | 30 years | ₹4,400 | ₹2,900 | ₹1,900 |
Target: ₹5 Crore
| Horizon | @ 10% | @ 12% | @ 14% | |---|---|---|---| | 15 years | ₹1,21,000 | ₹1,00,000 | ₹82,400 | | 20 years | ₹65,800 | ₹50,500 | ₹38,600 | | 25 years | ₹37,700 | ₹26,300 | ₹18,400 | | 30 years | ₹22,000 | ₹14,400 | ₹9,500 |
Target: ₹10 Crore
| Horizon | @ 10% | @ 12% | @ 14% | |---|---|---|---| | 20 years | ₹1,31,500 | ₹1,01,000 | ₹77,200 | | 25 years | ₹75,400 | ₹52,500 | ₹36,700 | | 30 years | ₹44,000 | ₹28,700 | ₹19,100 | | 35 years | ₹26,000 | ₹16,000 | ₹10,000 |
The numbers shrink dramatically with both time and assumed return. That is the compounding lever — every additional 5 years roughly halves the required monthly contribution.
Which return assumption to use
Most online calculators default to 12% or 15%. The honest range is narrower.
- Indian equity index (Nifty 50 TRI) over the last 20 years: approximately 11–13% CAGR.
- Average active equity fund (large-cap): approximately 10–12% net of fees in the same period.
- Average diversified portfolio (60% equity + 40% debt/gold): approximately 9–11%.
- Average pure debt portfolio: approximately 6–8%.
Use 10% for conservative planning, 12% for base case, 14% only as upper bound — and never plan around 14%. If you assume 14% and reality delivers 11%, you arrive at retirement with 60% of your target.
Rule: Plan with 10%. Be pleasantly surprised by 12%. Never assume 14%.
The inflation truth — ₹1 Cr in 20 years is not ₹1 Cr today
Here is the assumption that destroys most retirement plans: investors set a nominal target ("I want ₹1 Cr in 20 years") without translating to real purchasing power.
At 6% inflation (Indian historical average), ₹1 today is worth:
- ₹0.56 in 10 years
- ₹0.31 in 20 years
- ₹0.17 in 30 years
Inverted: to buy what ₹1 Cr buys today, you will need:
- ₹1.79 Cr in 10 years
- ₹3.21 Cr in 20 years
- ₹5.74 Cr in 30 years
So when someone says "I want a ₹1 Cr retirement corpus 30 years from now," the honest translation is "I want what ₹17 lakh buys today." That is not retirement money for most lifestyles.
The right way to set a SIP target: Decide what you need in today's rupees. Inflate it by 6% for the years to your goal. Then SIP to that nominal number.
For someone planning a 25-year retirement at today's equivalent of ₹2 Cr corpus:
- Real target today: ₹2 Cr
- Inflated nominal target: ₹2 Cr × (1.06)^25 = ₹8.59 Cr
- SIP needed at 12% nominal returns: ~₹45,000/month
A "₹1 Cr in 30 years" plan that costs ₹2,900/month at 12% is, in real terms, a ₹17 lakh corpus. That is not a plan.
Step-up SIP — the lever that makes it possible
Most people cannot start at ₹45,000/month. But they can start at ₹15,000/month and increase by 10% every year, which roughly tracks salary growth.
Future value of a step-up SIP with annual rate g and monthly amount P0:
A step-up of 10% per year applied to a ₹15,000 starting SIP at 12% returns produces:
| Horizon | Final corpus | |---|---| | 15 years | ~₹1.05 Cr | | 20 years | ~₹2.16 Cr | | 25 years | ~₹4.34 Cr | | 30 years | ~₹8.62 Cr |
The same ₹15,000 flat SIP (no step-up) at 12% gives you only:
| Horizon | Final corpus | |---|---| | 15 years | ~₹75 lakh | | 20 years | ~₹1.50 Cr | | 25 years | ~₹2.85 Cr | | 30 years | ~₹5.30 Cr |
The step-up adds 40–65% to final corpus with no change to investing behaviour beyond letting the SIP auto-increase each year. Read our dedicated piece: step-up SIP and inflation.
The four assumptions that wreck plans
1. Assuming returns are smooth
Real equity returns swing from −40% (2008) to +75% (2009) within 14 months. The "12% annualised" number conceals huge year-to-year variance. Plans that need exactly 12% per year fail in years when the market delivers −20%.
Mitigation: Plan for sequence-of-returns risk. The last 5 years before your goal date matter disproportionately — if a 2008-style crash hits then, you cannot recover before withdrawal. Shift toward debt in those final years.
2. Assuming you will not touch the corpus
Life happens. Job loss. Medical emergency. Wedding. The SIP that "would have become ₹2 Cr" never becomes ₹2 Cr if you redeemed ₹15 lakh in year 12 because of a medical issue.
Mitigation: Maintain a separate 6-month emergency fund. Never raid the corpus.
3. Assuming you can save 30% of salary forever
In your 20s with no dependents, 30% is plausible. With kids and a home loan, it can drop to 12%. The SIP needs to flex with reality.
Mitigation: Plan with realistic average savings rate (15–20% for most middle-class trajectories), use step-up SIP to capture salary growth, accept that the final corpus is a range, not a number.
4. Assuming "returns will be better in India because it's growing"
It is true that emerging markets can return more. It is also true that Indian equity has had decade-long underperformance periods (2010–2020 was lacklustre after adjusting for inflation, even as GDP grew). Future returns are not guaranteed by past macros.
Mitigation: Plan with 10–12%, not 15%.
Honest crore-by-crore SIPs (inflation-adjusted)
Combining everything — real target, inflation, 10% step-up, 12% returns — the honest SIPs for a 30-year horizon ending in today's purchasing power:
| Today's-rupee target | Nominal corpus needed (after 30y @ 6% inflation) | Starting SIP with 10% step-up @ 12% returns | |---|---|---| | ₹50 lakh today | ~₹2.87 Cr nominal | ~₹5,000/month start, stepping up 10% annually | | ₹1 Cr today | ~₹5.74 Cr nominal | ~₹10,000/month start, stepping up 10% annually | | ₹2 Cr today | ~₹11.5 Cr nominal | ~₹20,000/month start, stepping up 10% annually | | ₹5 Cr today | ~₹28.7 Cr nominal | ~₹50,000/month start, stepping up 10% annually |
The shortcut: for a 30-year horizon at 12% return + 10% step-up + 6% inflation, the starting monthly SIP is roughly 1% of your real-rupee target. Want ₹1 Cr in today's money? Start ₹10,000/month with step-up. Want ₹5 Cr in today's money? Start ₹50,000/month with step-up.
The behavioural truth that matters more than the math
Two investors. Both SIP ₹20,000/month for 25 years.
Investor A: Stays the course through the 2008 crash, the 2020 crash, the 2022 correction. SIP continues. Step-up applied each year. Ends with ~₹4.34 Cr at 12% nominal returns.
Investor B: Pauses SIP in March 2020 for 8 months because "the market looks bad." Reduces step-up in 2022 because of "uncertainty." Ends with ~₹2.85 Cr.
The difference between A and B is ₹1.49 Cr — and it is not skill, fund selection, or market timing. It is behaviour. The single highest-leverage thing you can do to hit your number is not stop in bad years.
Read recession-proof your portfolio for the architecture that makes staying invested easier.
Action checklist
- Pick a target in today's rupees, not nominal. (₹50 lakh? ₹1 Cr? ₹3 Cr?)
- Inflate by 6% per year to your goal date.
- Pick a realistic return assumption (10% conservative, 12% base, 14% upper bound — never plan around 14%).
- Use the table or shortcut (1% of real-rupee target with 10% step-up) to find starting SIP.
- Set up the SIP with automatic 10% annual step-up. Most AMC apps support this.
- Pre-commit, in writing, that you will not pause SIPs in any market condition for any reason short of medical emergency.
- Re-run the math every 5 years — adjust for actual returns delivered vs assumed.
The math is the easy part. The math says ₹20,000/month for 25 years at 12% gets you ~₹4.3 Cr. The hard part is being the investor who actually contributes ₹20,000 every month for 300 months without quitting. Build for that, not just for the spreadsheet.
Disclaimer: All return assumptions are illustrative. Actual returns are not guaranteed. Inflation, tax, and personal circumstances can materially change outcomes. This article is general educational content, not personalised advice. Vijay Malik Financial Services is a SEBI-registered Research Analyst.
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Vijay Malik Financial Services Research Desk
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