Quickly calculate and comprehend the returns on your mutual fund SIP and lumpsum investments over time with our online calculator!
Investment Amount:
Estimated Returns:
Maturity Value:
*Investing in the securities market carries risk. Please do your own due diligence before investing.
Investing regularly through a Systematic Investment Plan (SIP) is an effective strategy for mutual funds, stocks, and ETFs. SIPs enable you to contribute small amounts at consistent intervals—whether weekly, monthly, or quarterly—towards your chosen investments. This regular investment approach helps in reducing the effects of market volatility. Our SIP calculator serves as a valuable tool to estimate and plan your financial goals, projecting returns based on an annual rate. It simplifies complex financial calculations, providing you with results almost instantly based on the information you provide. It's important to note the distinction between SIPs in stocks and mutual funds, as they are fundamentally different.
A Systematic Investment Plan (SIP) calculator helps you estimate potential returns using the principle of compound interest. Compound interest involves adding earned interest to the principal investment amount, which means you earn interest on the interest accrued over time.
Steps to Calculate Your SIP Returns
To calculate your SIP returns, you need to input the following details:
Formula Behind the SIP Calculator
The formula used to calculate the maturity amount (M) in an SIP is:
M = P x ( {[1 + i] n - 1 } / i) x (1 + i)
Where:
Example Calculation:
Let's consider an example to understand this better. Suppose you decide to invest Rs. 8,000 per month for a period of 5 years, expecting an annual return rate of 10%.
1. Convert the annual return rate to a monthly rate by dividing by 12: i=10%12=0.0083
2. Determine the total number of payments over 5 years: n=5×12=60
Now, using the formula: M=8,000×((1+0.0083)60−10.0083)×(1+0.0083)
By calculating this, you would find that the total corpus amounts to approximately Rs.6,24,659. If you decide to increase your monthly investment to Rs. 10,000, the new total corpus would be approximately Rs.7,80,824. Adjusting these inputs can help you plan and achieve your financial goals more effectively.
Research and careful calculation are crucial steps before making any investment decisions. Estimating potential returns is essential to determine if an investment is likely to be profitable. A SIP return calculator is a valuable tool for making informed investment choices.