Mutual Fund SIP Calculator
See the power of systematic investing and project your wealth growth
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Investment Growth Chart
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Year-by-Year Breakdown
| Year | Invested | Returns | Closing Balance |
|---|---|---|---|
| Click calculate to see breakdown | |||
Understanding SIPs
What is a SIP?
A Systematic Investment Plan (SIP) is a method of investing in mutual funds where you invest a fixed amount of money at regular intervals (usually monthly). It promotes disciplined investing and helps build wealth over the long term.
The Power of Rupee Cost Averaging
With SIPs, you buy more units when the market is low and fewer units when the market is high. This averages out your purchase cost over time, a powerful strategy known as Rupee Cost Averaging, which can reduce the impact of market volatility.
Formula Used for Calculation
The future value of a SIP is calculated using the formula for a regular annuity, plus the compound interest on any initial lump sum amount.
FV_SIP = P × [((1 + i)^n – 1) / i]
FV_LumpSum = L × (1 + i)^n
Where:
FV = Future Value
P = SIP Amount, L = Lump Sum
i = Monthly rate of return
n = Number of months
FV_LumpSum = L × (1 + i)^n
Where:
FV = Future Value
P = SIP Amount, L = Lump Sum
i = Monthly rate of return
n = Number of months
SIP Investment Tips
- Start Early: The sooner you start, the more time your money has to grow.
- Be Consistent: Don’t stop your SIPs during market downturns.
- Increase SIP Annually: Use a ‘top-up’ SIP to increase your investment with your income.
- Stay for the Long Term: The real magic of compounding is visible over long periods.