SIP Calculator

How the SIP Calculator works

A Systematic Investment Plan (SIP) lets you invest a fixed amount in a mutual fund every month. Thanks to compounding and rupee-cost averaging (you buy more units when prices are low and fewer when they are high), even small monthly investments can build a sizeable corpus over time. A step-up SIP increases your monthly amount by a chosen percentage each year, which helps your investment keep pace with your rising income.

Formula used

• P = Monthly investment amount
• i = Monthly rate of return = annual return ÷ 12 ÷ 100
• n = Total number of monthly instalments = years × 12

For a step-up SIP the monthly amount is raised by your chosen percentage at the start of each year, and every instalment then compounds for the rest of the tenure.

Worked examples

Normal SIP: ₹5,000 a month at 12% for 10 years means ₹6,00,000 invested, growing to about ₹11,61,695 (roughly ₹5,61,695 of returns).

Step-up SIP: the same ₹5,000 start with a 10% annual step-up at 12% for 10 years raises your total invested to about ₹9,56,245 and the corpus to about ₹16,87,163 — the yearly increases add nearly ₹5.3 lakh more than a normal SIP.

Things to keep in mind

• SIP returns are market-linked and not guaranteed. The expected-return figure here is only an assumption; actual returns depend on the fund and the market.
• Starting early matters more than investing large amounts — the extra years of compounding usually make the biggest difference to the final corpus.
• Gains are subject to capital gains tax that varies by fund type (equity vs debt) and holding period, and returns are net of the fund’s expense ratio.