How this calculator works
A SIP invests a fixed amount every month into a mutual fund. Each month's investment grows for a different length of time, so the future value is calculated using the standard SIP compounding formula:
Monthly rate r = Annual return ÷ 12 ÷ 100. Number of months n = Years × 12.
FV = P × [((1 + r)n − 1) ÷ r] × (1 + r), where P is your fixed monthly investment.
Total invested is simply P × n. Estimated returns are the difference between the future value and the total invested — the amount your money has grown by, assuming the entered rate holds for the full period.
Why SIP compounding works this way
Unlike a lumpsum, a SIP isn't a single amount growing for a fixed number of years — each monthly installment starts compounding from the month it's invested. The formula above accounts for this by treating each SIP as a series of monthly cash flows, each compounding for a different remaining duration, and summing them into a single future value. This is why SIP returns tend to smooth out volatility better than trying to time a single lumpsum investment.
This calculator assumes your monthly investment amount stays fixed for the entire period and that the expected return applies uniformly across every month. Real markets don't move in a straight line — actual returns will vary month to month even if the long-term average matches your assumption.
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Talk to a CA →What is SIP?
SIP stands for Systematic Investment Plan — a way of investing a fixed amount into a mutual fund at regular intervals, usually monthly, instead of investing a lump sum all at once. It's designed to build a habit of disciplined investing and to average out purchase cost over time through market ups and downs.
Is the return guaranteed?
No. Mutual fund returns are market-linked and not guaranteed. The expected return rate you enter into this calculator is an assumption you choose, not a promised or guaranteed outcome — actual returns can be higher or lower depending on market performance.
What's a realistic SIP return assumption?
It varies by fund category — equity, debt, and hybrid funds have very different risk and return profiles, and even within equity funds, historical returns have varied widely across time periods. We don't assert a specific number here; use a rate that reflects your own fund's category and your risk expectations, not a fixed assumption for all funds.
Does SIP amount need to stay fixed?
This calculator assumes a fixed monthly SIP amount for the entire investment period. If you plan to increase your SIP amount every year — a common strategy to keep pace with rising income — see the Step-up SIP Calculator, which models a SIP that grows annually.
This tool is for quick estimation only and is not a substitute for professional financial advice. Mutual fund investments are subject to market risks — read all scheme-related documents carefully before investing.
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