10 5 3 Rule: What It Is and How It Helps Your Money Grow

When people talk about making money grow, they often forget one thing: 10 5 3 rule, a practical guideline for setting realistic long-term return expectations on different types of investments. Also known as the 10-5-3 investment rule, it’s not a magic formula—it’s a reality check for how your money behaves over time. In India, where mutual funds promise 15% returns and fixed deposits offer 6-7%, this rule helps you cut through the noise and plan smarter.

The 10 5 3 rule breaks down expected returns by asset type: equities (like stocks or equity mutual funds) might give you around 10% annually over the long run, debt instruments (like PPF or FDs) deliver about 5%, and cash or savings accounts settle near 3%. It’s not about chasing the highest number—it’s about matching your goals with the right tool. If you’re saving for your child’s education in 15 years, expecting 15% from a fixed deposit is unrealistic. But if you’re investing ₹15,000 a month in equity funds, the 10% baseline gives you a solid anchor to track progress. This rule ties directly to the 15-15-15 rule, a popular Indian investment strategy where you invest ₹15,000 monthly for 15 years at 15% annual returns to reach ₹1 crore. The 10 5 3 rule reminds you that while 15% is possible with equities, it’s not guaranteed every year—and that’s why discipline matters more than hype.

It also connects to how you handle risk. If you put all your money in high-yield savings accounts hoping for 8%, you’re ignoring the volatility and withdrawal limits that come with them. The 10 5 3 rule says: balance your portfolio. Keep some in safe 5% instruments for emergencies, some in 10% growth assets for long-term goals, and don’t expect more than 3% from your everyday savings. This isn’t just theory—it’s why people who follow this approach end up ahead of those chasing flashy returns. You’ll find posts here that dig into exactly how to apply this rule to Indian markets, from PPF vs FD comparisons to how long-term investing in mutual funds actually plays out. No fluff. Just clear, practical ways to make your money work without guessing.