SIP Calculator – Systematic Investment Plan Calculator

Prospective investors can think that SIPs and mutual funds are the same. However, SIPs are merely a method of investing in mutual funds, the other method being a lump sum. A SIP calculator is a tool that helps you determine the returns you can avail when parking your funds in such investment tools. Systematic Investment Plan or SIP is a process of investing a fixed sum of money in mutual funds at regular intervals. SIPs usually allow you to invest weekly, quarterly, or monthly. 

What is a SIP Calculator?

A SIP calculator is a simple tool that allows individuals to get an idea of the returns on their mutual fund investments made through SIP. SIP investments in mutual funds have become one of the most popular investment options for millennials lately.

These mutual fund sip calculators are designed to give potential investors an estimate on their mutual fund investments. However, the actual returns offered by a mutual fund scheme varies depending on various factors. The SIP calculator does not provide clarification for the exit load and expense ratio (if any).

This calculator will calculate the wealth gain and expected returns for your monthly SIP investment. Indeed, you get a rough estimate on the maturity amount for any of your monthly SIP, based on a projected annual return rate.

How can a SIP return calculator help you?

SIPs are a more lucrative mode of investing funds compared to a lump sum amount according to several mutual fund experts. It helps you become financially disciplined and create a habit of savings that can benefit you in the future.

A SIP calculator online is a beneficial tool, which shows the estimated returns you will earn after the investment tenure.

Few of the benefits of SIP calculators include –

1. Assists you to determine the amount you want to invest in.
2. Tells you the total amount you have invested.
3. Gives an estimated value of the returns.

How do SIP calculators work?

A SIP plan calculator works on the following formula –

M = P × ({[1 + i]n – 1} / i) × (1 + i).

In the above formula –

• M is the amount you receive upon maturity.
• P is the amount you invest at regular intervals.
• n is the number of payments you have made.
• i is the periodic rate of interest.

Take for example you want to invest Rs. 1,000 per month for 12 months at a periodic rate of interest of 12%.

then 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)

which gives Rs 12,809 Rs approximately in a year.

The rate of interest on a SIP will differ as per market conditions. It may increase or decrease, which will change the estimated returns.

How to use ISH’s systematic investment plan calculator?

You can use the SIP amount calculator from ISH within a few clicks.

Just enter the monthly invested amount (the amount for which you have started the SIP), the number of years for which you want to stay invested, and the expected rate of return.

As soon as you input the value, the calculator will show you the estimated amount you can avail after your investment tenure is complete.

Advantages of using ISH systematic investment plan calculator

ISH offers the best SIP calculator, which provides the following advantages –

• Plan your investment based on the amount and tenure.
• It helps you compute an estimation of the total value of investments at the end of your SIP tenure.
• Shows accurate results and helps you save time required during a manual calculation.

A systematic investment plan calculator ensures that your savings portfolio is as per your requirements and financial needs.

FAQs 

How much can I invest in a SIP?

There is no limit to the amount you can invest in a SIP. The minimum amount that you can invest is Rs. 500 per month.

What is the maximum tenure of a SIP?

There is no maximum tenure of a SIP. You can invest as long as you can. The minimum tenure you can go for is 3 years.

Are SIPs similar to mutual funds?

People often tend to think of SIP as either mutual funds or different than a mutual fund. The fact is that SIP is just a style of investment and not a fund/scheme or a stock/investment avenue. It is an investment vehicle to invest periodically in a fund/scheme of your choice.

Can I modify my SIP amount?

Yes, you can anytime check your returns with SIP investment calculator and increase or decrease the SIP amount

Do SIP allows only equity mutual funds investments?

No, you can invest in debt and hybrid mutual funds through SIP.

What are the types of SIPs available?

Different types of SIPs are available in the market like –

• Step-up or top-up SIP: A step-up or top-up SIP enables you to increase the investment amount automatically at specified intervals at a particular amount or percentage.
• Perpetual SIP: A perpetual SIP enables you to keep investing as long as you wish to without any end date.
• Trigger SIP: A trigger SIP lets you start investing during a specific index level, NAV, date, or event.
• Flexible SIP: A flexible SIP lets you change the amount you are investing according to your preference.

Can I renew a SIP?

Yes, you can renew a SIP automatically. Companies also give you the option to cancel this auto-renew feature.

Can I pause my investments in a SIP?

Yes, mutual fund companies also provide the option of pausing your SIP investments up for a specified period.