SIP Calculator: Systematic Investment Plan Calculator
Plan your mutual fund investments and project future returns
About SIP Calculator
A SIP (Systematic Investment Plan) calculator is a tool that helps investors estimate the potential returns from their mutual fund investments made through SIP. It uses the power of compounding to project the future value of your investments based on regular contributions.
This calculator helps you plan your financial goals by showing how much you need to invest regularly to reach your target amount within a specific time frame, considering an expected rate of return.
How SIP Calculator Works
The SIP calculator uses the following formula to compute the future value of your investments:
FV = P × [{(1 + r)^n - 1} / r] × (1 + r)
Where:
- FV = Future Value of the investment
- P = Monthly investment amount
- r = Monthly rate of return (annual rate/12/100)
- n = Total number of months (years × 12)
Key Features
- Visual representation with interactive chart
- Real-time calculation as you adjust values
- Detailed breakdown of invested amount vs returns
- Responsive design works on all devices
- Clear visualization of compounding benefits
- User-friendly interface with sliders and inputs
Frequently Asked Questions
What is SIP in mutual funds?
SIP (Systematic Investment Plan) is an investment method where you invest a fixed amount regularly (monthly, quarterly, etc.) in mutual funds. It helps in rupee cost averaging and benefits from the power of compounding.
How accurate is the SIP calculator?
The calculator provides estimates based on the inputs you provide. Actual returns may vary due to market fluctuations, expense ratios, and other factors. It's always good to consult with a financial advisor for precise planning.
Can I change my SIP amount later?
Yes, most mutual funds allow you to increase, decrease, pause, or stop your SIP anytime. However, it's recommended to continue your SIP for the long term to benefit from compounding.
What is a good SIP amount to start with?
You can start with as low as ₹500 per month in most funds. The ideal amount depends on your financial goals, income, and expenses. The key is to start early and be consistent.
Is SIP better than lump sum investment?
SIP helps mitigate market timing risk through rupee cost averaging. Lump sum may perform better in rising markets, while SIP performs better in volatile or declining markets. A combination of both can be optimal.