Rs 12,000 SIP vs Rs 22,000 SIP: CA tells how you can fall short of Rs 1.7 cr retirement corpus despite investing more in SIP

Starting your investment journey early can make a far bigger difference than simply investing more money later, a reality that many investors underestimate. hartered accountant Nitin Kaushik in a social post on X (formerly Twitter) shared a comparison that shows how saving through an SIP starting at age 26 can result in a much larger retirement corpus than starting 10 years later with a higher amount SIP.

Let us see how this SIP strategy works, as per the CA’s example

Early start vs late start:

Kunal starts investing at the age of 26 with a monthly SIP of Rs 12,000. Over 29 years, assuming a 12% annual return, he builds a retirement corpus of Rs 3.68 crore.


Vikas, on the other hand, delays investing by 10 years and begins at 36. To compensate, he invests a higher amount of Rs 22,000 per month. However, over a shorter investment period, he accumulates only Rs 1.98 crore.
After looking at the numbers, despite investing more money each month and a larger overall amount, the late starter still falls short by a large margin.

Also read: Is there a new scheme promising Rs 20 lakh monthly returns? Here is what the government said

CA stated: “STARTING EARLY isn’t just a ‘good habit’ it’s a multi-crore advantage that no amount of extra capital can buy back.”

By beginning a Rs 12,000 monthly SIP investment at age 26, Kunal builds a Rs 3.68 crore corpus over 29 years, while Vikas starting, just a decade later, must dump Rs 22,000 every month only to end up with a Rs 1.98 crore corpus.

Despite Vikas investing Rs 10,000 more monthly and putting in Rs 8.4 lakhs more in total principal, he still finishes with Rs 1.7 crore less wealth than Kunal.

“The math of a 12% CAGR is brutal: the growth you miss in your late 20s is the most expensive ‘interest’ you will ever pay. You cannot out-save the time you’ve already lost,” writes CA.

Here the difference between Rs3.68 crore and Rs 1.98 crore is not just about money, it is about timing. The earlier you begin, the more you allow compounding to work in your favour, says the CA.

Power of compounding

The difference lies in the power of compounding. Compounding increases your investment returns over time and promotes faster development. It generates larger profits and promotes investment growth over time. The initial investments compound over time to form a considerable corpus.

What is an SIP?

A Systematic Investment Plan (SIP) is an investment route offered by mutual funds wherein one can invest a fixed amount in a mutual fund scheme at regular intervals– say once a month or once a quarter. The installment amount could be as little as Rs 100 a month and is similar to a recurring deposit. It’s convenient as you can give your bank standing instructions to debit the amount every month.