15-Year Wealth Creation Illustration
15-Year Wealth Creation Illustration Problem: An investor plans to build a dividend growth portfolio using a disciplined long-term approach. He starts with a monthly investment of ₹20,000 in a diversified portfolio of high-quality dividend-paying stocks. Every year, he increases his monthly investment by 10% to match income growth. The portfolio is expected to generate a long-term average return of 12% per annum . After 15 years , estimate: 1. The total amount invested 2. The future value of the portfolio 3. The annual dividend income if the portfolio yields 3% at the end of 15 years. Let us solve this step-by-step in a simple and logical manner. Solution: ✅ Given Data Monthly SIP (Year 1) = ₹20,000 Annual Step-Up Rate (g) = 10% Annual Portfolio Return (r) = 12% Time Period (n) = 15 years Dividend Yield at end = 3% PART 1 – Total Amount Invested Since SIP increases every year, we calculat...