💡The amount doesn't change when SIP overtakes FD
Whether you invest ₹5,000 or ₹50,000 a month, SIP overtakes FD at the same point — break-even depends on return rates and time, not the amount. At 12% SIP / 7% FD, SIP edges ahead from year 1, but the lead is small in early years. The gap accelerates after year 5 and reaches ₹2.5L by year 10 — roughly 4.7 years of your ₹5,000 SIP sitting extra in your pocket. At 0% tax, FD's real return turns slightly positive and the gap narrows.
How big is the gap between SIP and FD after 10 years?
Both invest ₹6L over 10 years. SIP returns ₹2.5L more.
₹5,000 might feel like a small amount — but over 10 years, where you put it matters more than how much. SIP gives you ₹2.5L extra — nearly 5 years of your own monthly contribution, created purely by compounding.
When is FD a better choice than SIP?
At ₹5,000/month, you're likely building your first financial safety net. Fixed Deposit genuinely makes more sense when:
You need money within 3 years
SIP can drop 30–40% temporarily. FD guarantees your amount on the exact date you need it.
You pay little or no income tax
At 0–5% tax, FD's real gain rises to 3–4%/yr — far more competitive.
Market drops would make you stop SIP
SIP fell 35% in 2020 then recovered. An abandoned SIP loses to FD every time.
It's your emergency fund
3–6 months of expenses should always be in FD — never in the markets.
Common questions
Is ₹5,000/month SIP better than Fixed Deposit for 10 years?
At a 30% tax slab, yes. ₹5,000/month SIP for 10 years gives ₹11.2L at 12% CAGR vs FD's ₹8.7L at 7%. After tax and 6% inflation, SIP's real return is +4.6%/yr vs FD's −1.0%/yr. Even at 0% tax, SIP outperforms by year 6. Use the tax slider above to see your bracket.
Is ₹5,000/month SIP enough to build real wealth?
Yes — at 12% CAGR, ₹5,000/month grows to ₹11.2L in 10 years, ₹22.4L in 15 years, and over ₹49L in 20 years. The longer you stay, the more compounding does the heavy lifting. ₹5,000 today is a more powerful start than ₹10,000 ten years from now.
What is ₹5,000/month Fixed Deposit (FD) worth after 10 years?
At 7% interest, ₹5,000/month FD for 10 years gives approximately ₹8.7L on ₹6L invested. After 30% income tax, approximately ₹7.9L. With 6% inflation, that has the purchasing power of only ₹4.4L in today's money — less than your total investment in real terms.
Why does the break-even year not change with the SIP amount?
Break-even depends on the ratio of returns, not the absolute amount. Whether you invest ₹5,000 or ₹50,000/month, SIP grows at 12% and FD at 7%. The crossover point is set by these rates and time alone. Once SIP overtakes FD, the gap scales proportionally with the amount.
Should I split ₹5,000 between SIP and FD, or go all-in on one?
If you don't have an emergency fund yet, keep 2–3 months of expenses in FD first (₹15–30K), then put ₹5,000/month fully into SIP. If you already have an emergency fund, going all-in on SIP for a 10-year goal maximises your outcome. A split like ₹3,500 SIP + ₹1,500 FD works if market volatility would cause you to exit SIP during a crash.