SIP vs RD: How much to save monthly to get 10 Lakh in 2028? SIP or RD, which is best?
SIP vs RD: Systematic Investment Plans (SIPs) and Recurring Deposits (RDs) are two popular ways to build wealth over time. If your financial goal is to accumulate Rs 10 lakh by the year 2028, both these options are relevant, each with its own set of trade-offs. In this report, we analyze how much you need to invest monthly in either option to hit your target.
What Is A Recurring Deposit (RD)?
A Recurring Deposit is one of the most conservative savings options available. It involves depositing a fixed sum of money every month for a tenure that usually varies from six months to 10 years. RDs offer guaranteed returns with very minimal risk to your capital, making them safer than market-linked investments. The trade-off is that returns are modest. As of 2025, interest rates on RDs range from 3% to 8.5% per annum.
What Are Systematic Investment Plans (SIPs)?
SIPs allow you to invest a fixed amount in mutual fund schemes at regular intervals, such as monthly or quarterly. This approach helps you gradually accumulate units in the fund, benefiting from market ups and downs over time. SIPs are very suitable for long-term wealth creation as they let you invest small amounts regularly without trying to time the market. While returns are market-linked and can fluctuate, historically, SIPs have tended to outperform fixed-income options in the long run, with returns upwards of 10% to 15%.
Accumulating Rs 10 Lakh By 2028
The choice between RD and SIP becomes important to reach Rs 10 lakh by 2028. If you intend to create this corpus by the end of 2028, say December, it is crucial to know how much you need to invest every month.
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To achieve the Rs 10 lakh goal, the monthly investment required will differ based on the instrument you choose. Here is a comparative look:
| Investment Type | Assumed Annual Return | Required Monthly Investment |
|---|---|---|
| Recurring Deposit (RD) | 6.5% | Approx. Rs 25,200 |
| SIP (Equity Mutual Fund) | 12% (Average) | Approx. Rs 23,300 |
With an assumed interest rate of 6.5% per annum, to reach Rs 10 lakh by December 2028 (roughly three years away), you would need to invest about Rs 25,200 per month in a Recurring Deposit (RD).
In the case of SIPs, assuming an average annual return of 12%, you would need to invest about Rs 23,300 per month to achieve the same target. While this requires slightly less monthly investment than an RD, it carries some market risk.
Choosing Between RD And SIP
RDs are ideal if you want safety and guaranteed returns, even though you need to invest more each month. SIPs are better if you can handle market ups and downs and want higher growth with a slightly lower monthly investment. To reach Rs 10 lakh by 2028, a SIP may help you get there with less money each month, but if you prefer certainty and want to avoid any risk, an RD is the safer choice.
Disclaimer: Investment in Mutual Funds and securities market are subject to market risks. Please read all scheme-related documents carefully before investing. This article is for informational purposes only and does not constitute financial advice.
