Investment Tips: Can you become a millionaire even if you earn Rs 50,000 every month? It is not impossible, rather the magic of compounding and the rule of 8-4-3 can help you become a millionaire. This rule tells you how your money can grow rapidly with the right investment strategy. Now the question is, in how many years can a person earning 50 thousand become a millionaire? If you think it will take 20 to 30 years, then you are absolutely wrong. You can become the owner of one crore rupees in just 15 years. Let's understand the whole math.

Formula of Compounding
Compounding is the power of investment due to which your money keeps on increasing every year and that too at a faster speed. In this, the returns received on the investment made by you are reinvested, due to which the investment amount increases again and again. This is called 'compound interest'. This process helps in creating a large amount in the long term.

How will the 8-4-3 rule work? The
The 8-4-3 rule is a special method of compounding, through which investors can get very fast returns on their money. Let us understand this rule with an example- Suppose your monthly salary is Rs 50,000 and you invest Rs 20,000 out of it every month in an asset class (such as shares, bonds, bank FDs, etc.) which gives a return of 12 percent annually.

In the first 8 years, a monthly investment of Rs 20,000 will take your total fund to Rs 32 lakh. In the next 4 years, at the same rate, your fund will grow to Rs 64 lakh. In the next 3 years (after a total of 12 years), if you continue to invest Rs 20,000 per month, the fund of Rs 64 lakh will grow to Rs 1 crore. Thus, your dream of becoming a millionaire can be fulfilled in 15 years.

Things to keep in mind before investing
Although this rule shows you an easy way to become a millionaire, every type of investment has risks. It is also not necessary that you will keep getting a return of 12 percent per annum. Therefore, it is important to consult a certified investment advisor before investing in any asset class (such as shares, bonds, mutual funds, or bank FDs).

Patience, discipline, and regular investment are required to take advantage of compounding. This rule is effective only for those who are committed to investing for a long period. By using the 8-4-3 rule correctly, you can not only strengthen your financial position but can also fulfill your dream of becoming a millionaire.