How I made Rs. 1,00,000 from Rs.10,000

My journey started way back in December 2003, I was just out of school and with some basic knowledge in HTML. And boom I got my first project from a Nashik-based school Boys’ Town School at that time I got my first cheque of  Rs.15,000/- . After buying hosting and domain name service from a Delhi based provider. (At that point of time i didn’t own netspaceindia 😉 ) I absolutely had no idea what to do with the Rs.10,000/- and I was having absolutely no idea what to do with my Rs.10,000/-. The easy way was to give that money to my dad but then after doing some study and consulting my dad, I invested the money in  UTI Equity Fund  at that point the price of 1 unit was Rs.9 so I brought 1,111 units of UTI Equity Fund and totally forgot about it for years.

Today 13yrs later, the price of one unit is Rs.103. Now my 1,111 units are worth Rs. 1,14,433 /- that is 10 times of what I invested. Now this is a classic example of keeping patience with your investment. Now let me explain what a mutual fund is:

A mutual fund is an entity that pools the money of many investors — (unit-holders, like me) — to invest in different shares, debt securities, money market securities or a combination of these. Those securities are professionally managed on behalf of the unit-holders, and each investor holds a pro-rata share of the portfolio.

At that early age I was not aware of share market and absolute no knowledge of profit and loss, so decided to go with professional and go with a mutual fund. When you buy a mutual fund through one-time investment or through SIP (systematic investment plan) you have to understand that these will be your long term investment, When I say long term investment I really mean it (more than 10 + year).

Now imagine what must have happened if I had invested this money for 13 years, in any other investment method, here is the comparing sheet :

 Years UTI Mutual Fund (1,111 unit) FD @ 8 % Gold (20g)
0 10000 10000 10000
1 12221 10800 11700
2 22220 11664 14000
3 24442 12597 16800
4 36663 13605 21600
5 36663 14693 25000
6 53328 15869 29000
7 37774 17138 37000
8 31108 18509 53000
9 64438 19990 63400
10 65549 21589 63400
11 64438 23316 57400
12 91102 25182 53400
13 114433 27196 57400

As an investor, you would like to get maximum returns on your investments, but you may not have the time to continuously study the stock market to keep track of them. You need a lot of time and knowledge to decide what to buy or when to sell. A lot of people take a chance and speculate, some get lucky, most don t. This is where mutual funds come in. So my TIP for all new investor is to keep investing and keep growing, Also did you I mentioned, This Rs. 1,00,000/- is tax-free ? 🙂

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