SIP Calculator
SIP
Lumpsum
Monthly investment
₹
Expected return rate (p.a)
Time period
Invested amount
₹6,000
Est. returns
₹33
Total value
₹6033
Invested amount
Est. returns
What is a SIP Calculator?
The SIP calculator is an online tool that helps you to calculate the expected returns and gains from your monthly mutual fund SIP investments. In recent years, investing in mutual funds through SIPs has become a lucrative option investment alternative especially among the youth. The SIP calculator is designed to give potential investors an idea of how much their mutual fund investments will cost. There are several factors that determine how much money you will make from a mutual fund scheme and based on an expected annual return; it calculates the SIP amount needed to achieve your financial goals.
How does SIP Calculator work?
The following formula is used by a SIP plan calculator:
M = P × ({[1 + i]^n – 1} / i) × (1 + i).
In the above formula –
- M = is the amount you receive upon maturity.
- P = It is the amount you invest on a constant basis.
- n = Investment duration in months
- I= Compounded rate of return
For Example-
Assume you want to invest Rs. 1,000 per month for 12 months at a 12% periodic rate of return.
The monthly rate of return will be 12%/12 = 1/100=0.01
Hence, M = 1,000X ({[1 +0.01 ]^{12} – 1} / 0.01) x (1 + 0.01)
Over the course of a year, you will receive approximately 12,809 rupees.
The interest rate on a SIP will vary depending on market conditions. It may rise or fall, causing the expected returns to fluctuate.
How can a SIP return calculator help you?
Many mutual funds experts are of the view that SIPs are a more feasible method of investing funds as compared to lump sum signifies financial discipline and inculcates a habit of saving among the investors.
A SIP calculator online is a useful tool for calculating the return from your periodic investments once the investment duration ends.
Some of the benefits are given below-
- The calculator is simple to use and provides a quick way to calculate the projected returns on small monthly investments. As a result, investors can plan their investments strategically to accomplish their long-term financial objectives.
- The calculators make it easier for even new investors to understand the complex details of SIP investments.
- Estimates the value of the returns.
