SIP mantra: Should you invest Rs 20,000 for 15 years or Rs 15,000 for 20 years? Explained

Planning your SIP journey, but confused if you should invest more for a shorter duration or less for a long duration?When it comes to building wealth, patience and time often matter more than how much you invest each month.

A small but regular contribution over a long period can create a larger corpus than investing a higher sum for a shorter duration.For example, investing a monthly SIP of Rs 15,000 for 20 years could give you Rs 42 lakh more than what investing Rs 20,000 SIP would give in 15 years. The key difference lies in compounding, according to an ET report.

Investing Rs 15,000 SIP for 20 years vs Rs 20,000 SIP for 15 years

If you invest Rs 15,000 every month through an SIP for 20 years at a 12% annualised return, you could build an estimated corpus of Rs 1.38 crore.On the other hand, investing Rs 20,000 every month for 15 years at the same return would leave you with about Rs 96 lakh, says the report.In both cases, the total amount invested is Rs 36 lakh. Yet, by staying invested for five additional years, the Rs 15,000 SIP generates Rs 42 lakh more, around 44% higher.For someone starting at age 30, this longer SIP could result in a corpus 1.44 times larger by the time they turn 50, compared to the 15-year plan.

In short, even with the same overall investment, cutting five years short can come at a steep cost, ET reported.

(Credit: ET)

The secret behind difference

The answer lies in the power of compounding. The longer money stays invested, the faster it grows.Take another example: If you invest Rs 5 lakh for 15 years at a 12% annualised return, you could generate an estimated Rs 28 lakh corpus. But if you keep the same investment for five more years, the amount can rise to Rs 49 lakh, an increase of Rs 21 lakh in just five years, according to the financial daily.

What to keep in mind

Since SIPs are market-linked, they are bound to face ups and downs and may even show negative returns at times. But over the long run, short-term volatility matters little, as equities have historically delivered strong growth.A 12% return may sound ambitious, but data shows it is not impossible. As of 26 August 2025, the 10-year return for large-cap mutual funds stood at 12.79% annualised, according to Value Research.

While past performance cannot guarantee the future, it offers a fair benchmark to set expectations. Large-cap funds, considered the safest among equity options, have historically delivered in this range as per an ET report.As one’s income grows, they should increase their investment amount. However, even if they do not, being consistent and investing long term may deliver generous returns from small investments.(Disclaimer: Recommendations and views on the stock market and other asset classes given by experts are their own. These opinions do not represent the views of The Times of India)