I am 48-yr-old, looking for best investment plan where I can get compounding interest.
1. investing 10 lakh in one go for 10 yrs
2. investing 10 to 15k monthly for 5 yrs to 10 yrs
Please advice HDFC capital guarantee solution plan or any other plans.
Ans: Hi Praveen. It depends entirely on your investment mode. Both lump sum and sips are good. In comparison, sip facilitates the averaging out of risk and price per unit. With sip, retail investors can invest per month in small contributions, which simplifies consistency in investing.
Compared to lump sum, with 10 lakh invested one time, the difference in the accumulated corpus is not much for a ten-year horizon, with SIP 15k per month. In end sip is a better alternative for risk diversification and capital growth.