SIP Calculator

SIP Calculator

A Systematic Investment Plan (SIP) allows you to invest little amounts of money in mutual funds on a monthly basis rather than a lumpsum amount. This strategy helps to average out investment costs and gains from compounding growth. SIPs are flexible allowing you to choose the amount and duration as per your financial goals.

If you are planning to put your money in mutual funds, an online SIP calculator could be helpful in deciding the amount you need to invest for building a certain corpus fund. A SIP calculator is an online tool that allows investors to assess the possible returns of a Systematic Investment Plan (SIP) in mutual funds.

How do SIP Calculators work?

The SIP Calculator is a free, user-friendly tool available for all. It instantly calculates the value of your investments over a period of time. You can check how your wealth will grow by simply entering the SIP amount, expected rate of return, and the duration of investment.

The SIP calculators use a simple formula to compute the estimated returns:

FV = [P x R x (1 + i)n-1/i] x (1 + i)

Where:

• FV is the future value of your investment
• ‘i’ is the compounded rate of return
• ‘R’ is the expected rate of return
• ‘P’ is the SIP amount
• ‘n’ is the number of instalments

Benefits of investing through SIP

• SIP investments help to inculcate financial discipline by promoting regular savings.
• You can build a large corpus through small investments every month.
• The SIP investments offer you the flexibility to increase or decrease the amount as per your needs or financial conditions.
• SIP investments are convenient to start as you can begin with a monthly amount of ₹500. Even many schemes allow SIP with a minimum amount of ₹100 per month.

Advantages of Using SIP Calculator

• It is simple and free, with unlimited access.
• Provides a transparent view of potential returns.
• Automates complex calculations.
• Helps plan monthly investments to meet financial targets.

How to use online SIP Calculators

It’s easy and simple to use an online SIP Calculator. Open the webpage of the SIP Calculator and enter the following details:

• Monthly investment amount
• Duration of the investment
• Expected rate of return

The SIP calculator will show the total amount along with the interest earnings.

How Can SIP Calculators Help You?

A SIP return calculator helps you estimate how much your investments can grow over time with regular contributions. It allows you to see potential future returns based on how much you invest each month, for how long, and at what rate. This provides you necessary information to plan your finances, set realistic goals, and make informed decisions about your investments. By using the calculator, you can also compare different investment scenarios and track your progress toward your financial goals.

Examples of SIP Growth