SIP Calculator
Calculate the future value of your Systematic Investment Plan (SIP). A SIP allows you to invest a fixed amount regularly in mutual funds and benefit from rupee cost averaging and compounding. Compare with a recurring deposit calculator for guaranteed returns or our investment calculator for lump-sum growth.
How to Calculate SIP Returns
- Decide your monthly SIP amount based on your savings capacity.
- Estimate the expected annual return rate based on the fund category (equity: 12-15%, debt: 6-8%).
- Choose your investment horizon in years.
- Apply the future value of annuity formula with monthly compounding.
- The difference between total value and total invested is your estimated returns.
Formula
SIP Future Value = P x [(1+r)^n - 1] / r x (1+r)
Where:
P = Monthly SIP amount
r = Monthly rate of return (annual rate / 12 / 100)
n = Total number of months (years x 12)
Total Invested = P x n
Estimated Returns = Future Value - Total InvestedExample
You invest 5,000 per month for 10 years at an expected return of 12% per annum:
Monthly SIP = 5,000
Annual Return = 12%
Monthly Rate = 12% / 12 = 1% = 0.01
Period = 10 years = 120 months
Future Value = 5,000 x [(1.01)^120 - 1] / 0.01 x (1.01)
= 5,000 x [3.300 - 1] / 0.01 x 1.01
= 5,000 x 230 x 1.01
= 11,61,695
Total Invested = 5,000 x 120 = 6,00,000
Estimated Returns = 11,61,695 - 6,00,000 = 5,61,695
Your money nearly doubled through the power of compounding!SIP Growth Reference Table
| Monthly SIP | 5 yr @ 12% | 10 yr @ 12% | 15 yr @ 12% | 20 yr @ 12% |
|---|---|---|---|---|
| 1,000 | 82,486 | 232,339 | 504,576 | 999,148 |
| 2,000 | 164,973 | 464,678 | 1,009,152 | 1,998,296 |
| 3,000 | 247,459 | 697,017 | 1,513,728 | 2,997,444 |
| 5,000 | 412,432 | 1,161,695 | 2,522,880 | 4,995,740 |
| 10,000 | 824,864 | 2,323,391 | 5,045,760 | 9,991,479 |
| 15,000 | 1,237,295 | 3,485,086 | 7,568,640 | 14,987,219 |
| 20,000 | 1,649,727 | 4,646,782 | 10,091,520 | 19,982,958 |
| 25,000 | 2,062,159 | 5,808,477 | 12,614,400 | 24,978,698 |
Frequently Asked Questions
What is a SIP?
A Systematic Investment Plan (SIP) is a method of investing a fixed amount regularly (usually monthly) in mutual funds. It automates investing, enforces discipline, and benefits from rupee cost averaging by buying more units when prices are low.
What return can I expect from SIP?
Returns depend on the fund type. Large-cap equity funds historically return 10-12% over 10+ years, mid-cap 12-15%, and debt funds 6-8%. Past performance does not guarantee future returns. Use 12% as a reasonable long-term equity estimate.
Is SIP better than lump sum investing?
SIP reduces timing risk through rupee cost averaging and is better for regular income earners. Lump sum can outperform in rising markets. For most investors, SIP is recommended because it removes the need to time the market.
Can I stop or modify my SIP?
Yes, SIPs are flexible. You can pause, stop, increase, or decrease your SIP amount at any time without penalty. There is no lock-in period for regular mutual fund SIPs (ELSS funds have a 3-year lock-in).
How is SIP different from a recurring deposit?
SIP invests in market-linked mutual funds with variable returns and no guaranteed outcome. RD is a bank product with fixed, guaranteed returns. SIP has higher potential returns but also carries market risk, while RD is risk-free.