SIP Calculator

How to use the SIP calculator

Enter the amount you plan to invest every month, the annual return you expect and how many years you will stay invested. The calculator shows the estimated maturity value, splits it into the amount you invested and the estimated returns, and charts the growth year by year so you can see compounding take over in later years. Add an inflation rate to see what the final corpus is worth in today's rupees — a figure most SIP calculators leave out.

SIP return formula

A SIP is a series of equal monthly investments, each of which compounds for a different length of time. Indian fund houses and platforms use the future-value-of-an-annuity-due formula, which assumes each instalment is invested at the start of the month:

• P — monthly SIP amount
• i — monthly rate of return = annual return ÷ 12 ÷ 100
• n — number of monthly instalments (years × 12)

Real mutual fund returns are not fixed: NAVs rise and fall every day. The formula shows what your SIP would be worth if it earned a steady average return, which is useful for planning but not a promise.

Worked example

Invest ₹10,000 a month for 10 years at an expected 12% a year. The monthly rate is 1% and there are 120 instalments, so FV = 10,000 × (1.01¹²⁰ − 1) ÷ 0.01 × 1.01 ≈ ₹23,23,391. You put in ₹12 lakh; the remaining ₹11.23 lakh is returns. Keep the same SIP for 20 years and the value grows to about ₹99.9 lakh on ₹24 lakh invested — in the second decade, returns dwarf contributions. At 6% inflation, ₹23.2 lakh after 10 years buys what about ₹13 lakh buys today.

What return should you assume?

Use conservative numbers. Long-run returns from diversified Indian equity funds have historically been around 10–14% a year, but with big swings and multi-year flat periods. Debt funds have typically delivered 6–8%, and hybrid funds sit in between. For goal planning, many advisers use 10–12% for equity, then check that the plan still works at a lower rate. Remember that returns are after the fund's expense ratio; direct plans cost less than regular plans, and that difference compounds too.

Tips to get more from your SIP

• Start early. Time matters more than amount. A 25-year-old investing ₹5,000 a month to age 60 can end with more than a 35-year-old investing ₹15,000.
• Step it up. Increase your SIP every year with your salary. Even a 10% annual increase can nearly double the final corpus over 20 years — try the step-up SIP calculator.
• Don't stop in a fall. Rupee-cost averaging means market dips buy more units. Investors who pause SIPs during crashes miss the recovery.
• Match the fund to the goal. Equity for goals 7+ years away, hybrid or debt for shorter ones. For a one-time investment use the lumpsum calculator.
• Know the tax. Equity fund gains held over 12 months are long-term capital gains taxed at 12.5% above ₹1.25 lakh a year; short-term gains are taxed at 20%. Each SIP instalment has its own holding period.

Mutual fund investments are subject to market risk. This calculator gives estimates for illustration and is not investment advice; actual returns will vary.