Embarking on an investment journey with a clear income goal is commendable. Let’s tackle this question step by step.
Firstly, we need to understand that the amount to be invested primarily depends on the return rate of your chosen investment avenue. For instance, if you aim for a conservative approach via fixed deposits that might offer around 5% annual interest, you’d need a different corpus compared to investing in equities, which historically offer around 12% annually, though with higher risk.
Let’s do some quick math.
For a conservative approach using fixed deposits:
Annual returns required: Rs. 10,000 x 12 = Rs. 1,20,000
At 5% interest: Principal = Rs. 1,20,000 ÷ 0.05 = Rs. 24,00,000
For a slightly aggressive approach using equities:
Annual returns required: Rs. 10,000 x 12 = Rs. 1,20,000
At 12% interest: Principal = Rs. 1,20,000 ÷ 0.12 = Rs. 10,00,000
But remember, while equities offer higher potential returns, they also come with associated risks. So, it’s not just about the math. It’s about aligning the investment with your risk appetite, financial objectives, and horizon.
To sum up, it’s possible to generate Rs. 10,000 per month, but the initial investment depends significantly on your chosen avenue and risk tolerance. Investing in a mix of asset classes might also be a prudent approach. And as you tread this path, always consider seeking guidance. At Jama Wealth, we’re always here to assist with your tailored portfolio management needs.
