SIP Calculator

Estimate the future value of your Systematic Investment Plan (SIP) investments.

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What is a SIP Calculator?

A SIP (Systematic Investment Plan) Calculator is a financial tool that helps you estimate the future value of your mutual fund investments made through regular installments. It projects how much your money can grow over time based on the monthly investment amount, the expected annual return rate, and the investment duration. This is crucial for planning long-term financial goals like buying a house, funding your child’s education, or building a retirement corpus.

How to Use the SIP Calculator

To see the potential growth of your investment, simply enter the following details:

  1. Monthly Investment (₹): Enter the amount you plan to invest every month. For example, if you are starting a monthly SIP of ₹10,000.
  2. Expected Return Rate (%): Input the annual return you expect from your investment. For equity mutual funds in India, a long-term average of 12% is a common assumption.
  3. Time Period (Years): Specify for how many years you plan to stay invested.

The calculator will instantly show you the total amount you will have invested, the estimated returns you’ve earned, and the total future value of your investment.

Why Use an Online SIP Calculator?

A SIP calculator is an indispensable tool for every investor in India. Here’s why:

  • Goal Planning: It allows you to do "reverse calculation". You can figure out how much you need to invest monthly to reach a specific financial goal, like accumulating ₹1 crore for retirement.
  • Visualize the Power of Compounding: The calculator clearly shows how a small, regular investment can grow into a substantial amount over time, motivating you to stay disciplined.
  • Error-Free and Instant: It saves you from complex manual calculations (using the future value of annuity formula) and provides immediate, accurate projections.

Frequently Asked Questions (FAQ)

Q: What is the benefit of SIP over a lump sum investment?

A: SIP helps in rupee cost averaging. You buy more units when the market is low and fewer units when the market is high, which can average out your purchase cost over time and reduce risk. It also promotes disciplined investing.

Q: Are the returns from a SIP calculator guaranteed?

A: No. The returns shown are just an estimate based on the expected rate you enter. Actual returns from mutual funds are not guaranteed and depend on market performance.

Q: How is the maturity amount in a SIP calculated?

A: It is calculated using the future value of annuity formula: M = P × (({[1 + i]^n – 1} / i) × (1 + i)), where M is maturity amount, P is the monthly investment, i is the monthly interest rate, and n is the number of months.