What is a SIP calculator?
A SIP calculator shows how much a fixed monthly investment in a mutual fund can grow to over time. You enter the monthly amount, the expected yearly return and the number of years. It shows the total you invest, the estimated gains and the final value. You can also add a yearly step-up to raise your SIP every year.
How to use it
- Enter your monthly SIP amount.
- Set the expected yearly return. Equity funds have returned about 10% to 14% a year over long periods, but returns are not guaranteed.
- Choose how many years you will invest.
- Optional: add an annual step-up, for example 10% if you plan to raise your SIP each year.
Formula
FV = P × [((1 + r)^n − 1) / r] × (1 + r)
- P is the monthly SIP amount.
- r is the monthly rate of return (yearly rate ÷ 12 ÷ 100).
- n is the number of monthly instalments.
Example
A SIP of ₹10,000 a month for 15 years at 12% a year means you invest ₹18 lakh in total. At 12% it can grow to about ₹50 lakh, so the estimated gain is about ₹32 lakh.
Frequently asked questions
How accurate is a SIP calculator?
The maths is exact for the return you enter. Real mutual fund returns change every year, so treat the result as an estimate, not a promise.
What return should I use for an equity SIP?
Many people use 10% to 12% a year for diversified equity funds over 10 years or more. Use a lower rate, like 7% to 8%, for debt or hybrid funds.
What is a step-up SIP?
A step-up SIP raises your monthly amount by a fixed percentage every year, usually in line with your salary. Even a 10% yearly step-up can grow the final amount a lot.
Is SIP better than a lump sum?
A SIP spreads your buying over time, so you buy more units when prices are low. A lump sum can do better in a rising market. For regular income, a SIP is easier to keep up.
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Results are estimates for planning only and are not investment advice.