Remember the time when putting money in a fixed deposit (FD) felt like the safest bet? Our parents proudly said, “FD lagao, paise badhenge” and it worked for their generation. Back then the certainty of returns made sense, it was a symbol of financial wisdom.

But fast forward to today, the world has changed so much. Prices rise faster, inflation quietly erodes savings and the same FD that once felt rewarding now struggles to keep your wealth afloat.  That safe money is barely keeping up with inflation. Meanwhile, those who started long-term SIP investment a decade ago are quietly watching their money multiply over time. 

FD & SIP: Two Ways to Save, One Way to Grow

At first glance, FDs and SIPs look similar but are they? Both are safe and disciplined ways to save money regularly but beneath the surface, they play entirely different games.

• FDs: You invest a lump sum for a fixed tenure and earn a pre-decided interest rate, which is currently around 6–7% per annum depending on the bank and macro-economic conditions.
• SIPs: You invest small amounts regularly into mutual funds that are market-linked, giving average returns of 10–14% compounded annual growth return (CAGR) over the long run.

The numbers might seem close, but the impact over time is massive because compounding doesn’t reward what you earn, it rewards what you reinvest.

The Rs 10,000 Test: How Growth Adds Up Over Time

Let’s talk about it and see what the future holds for you. Assume you invest Rs 10,000 every month for 10 years.

• FD at 6% interest: Rs 10,000 × 120 months = Rs 12,00,000 invested → grows to Rs 16.5 lakhs
• SIP at 12% CAGR: Rs 10,000 × 120 months = Rs 12,00,000 invested → grows to Rs 2 lakhs

There you go, that's a difference of Rs 6.7 lakhs that too without investing a single rupee extra.

Now let’s dig in more and extend that to 20 years:

• FD (6%) → Rs 39 lakhs
• SIP (12%) → Rs 1 Crore

This is the magic of compounding. The same monthly amount, same consistency, yet nearly Rs 60 lakh more - the kind of growth that makes long-term ‘goals’ achievable.

FD vs SIP Returns Over Time

(Data based on assumed CAGR, for illustration only.)

Behind every number here is a simple truth - you don’t have to chase returns; you just have to stay consistent.        

Growing Beyond Inflation: The SIP Advantage

Picture Rohan, a 28-year-old professional, diligently saves a portion of his salary every month in a FD. His parents did it, their parents did it and it always felt like the smart thing to do. Every year, the number in his bank statement grows but somehow his goals don’t seem to catch up.

A few years later, Rohan notices something strange. The price of everything around him from rent to groceries has quietly doubled. His savings had grown, yes, but the growth hadn’t kept pace. What looked like a stable plan had made him fall behind. He fell into the comfort trap. Inflation silently eats into those “guaranteed” returns and the comfort of stability often comes at the cost of real growth.

According to RBI data, India’s average inflation rate over the last two decades has hovered around 5.9%, while most FDs offer 6–7% returns before tax. Once taxes and inflation are accounted for, the ‘real return’ often dips below 2% or worse, turns negative. Moreover, keeping a small corpus in fixed deposits is as good as keeping it in savings accounts.

On the other hand, SIPs can grow small investments into huge corpus. SIPs in diversified equity mutual funds have historically delivered 12–15% CAGR over long periods, significantly outpacing inflation. More than just numbers, it’s a mindset shift - from saving safely to investing smartly.

Let Your Money Grow

Imagine your money quietly working every month, turning small, consistent steps into something meaningful. That’s the real power of SIP investment for beginners. The beauty of safe SIP plans is in their rhythm. It’s not about rushing or timing the market but about letting time and discipline do their work. Each contribution adds momentum, each month stacking toward your goals.

Ask yourself- Do I want my money to simply sit, or do I want it to grow with me? Start your SIP today and let consistent steps turn into long-term wealth, even small steps in SIPs can set your wealth in motion today.

With MINTIT — India’s best app to invest in mutual funds, you can start your long-term SIP investment journey in just a few taps. Depending on your profile it can precisely suggest tailored investing plans to achieve your goals through best suited mutual funds. Sign up to MINTIT now and start your mutual funds SIPs journey with professional guidance.