Tool

SIP Calculator

A SIP is a standing instruction, nothing more: the same amount leaves your account on the same date each month and buys mutual fund units at whatever the price happens to be. Over ten years at ₹5,000 a month you contribute ₹6 lakh — and end up near ₹11.6 lakh if returns hold around 12%.

Enter the amount, the return you're willing to assume, and how long you'll keep going; the tool splits the result into what you put in and what compounding added, year by year. Hover the ? on any field if you're unsure what to enter. The full explanation is below — including what return rate is honest to assume, and what the yearly increase actually buys you.

Calculator

SIP Returns

Monthly SIP (₹) ? The fixed amount auto-debited from your bank each month to buy mutual fund units. ₹5,000 is a common starting point, and you can raise or pause it later without penalty.

Return Rate (%) ? The annual growth you assume the fund delivers. Indian equity indices have returned roughly 12% over long stretches — use 10–12% and treat anything higher as wishful.

Duration (Yrs) ? How many years you keep investing. Compounding does most of its work late, so 20 years is far more than twice as good as 10.

Yearly Increase (%) ? Raises your SIP by this much every year — the "step-up SIP" your fund app offers. Put 10 if you expect roughly a 10% annual hike; 0 keeps the amount flat forever.

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Invested ? The total that leaves your bank account over the whole period — your monthly SIP added up, nothing else.

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Returns ? The part of the corpus that came from growth rather than from your pocket. Over long periods this ends up larger than what you contributed.

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Total Value ? What the investment is worth at the end — contributions plus growth. A pre-tax figure; equity gains are taxed when you actually redeem.

Show inflation-adjusted value

Compounded monthly. Actual returns will vary.

How a SIP compounds your money

Every month you invest a fixed amount. That amount earns returns, and the next month you invest again — on top of last month's growing pile. This is compounding: your returns start earning their own returns.

After 10 years of ₹5,000/month at 12%, you've put in ₹6 lakhs. But your corpus is ₹11.6 lakhs — nearly double. The extra ₹5.6 lakhs came entirely from compounding, not from your pocket.

The formula

The future value of a monthly SIP is calculated as:

SIP Future Value M = P × [ (1 + r)ⁿ − 1 ] ÷ r × (1 + r)

Where: P = monthly investment, r = monthly return rate (annual rate ÷ 12), n = total months invested

Example: ₹5,000/month at 12%/year for 10 years →
r = 12% ÷ 12 = 1% per month (0.01), n = 120 months
M = 5000 × [(1.01)¹²⁰ − 1] ÷ 0.01 × 1.01 = ₹11.6 lakhs

What the yearly increase (step-up) does

With a 10% annual step-up, your ₹5,000/month becomes ₹5,500 in year two, ₹6,050 in year three, and so on. Over 10 years, this can add ₹3–5 lakhs to your corpus compared to a flat SIP — and it's designed to match your annual salary increments.

Frequently Asked Questions

How much SIP per month to reach ₹1 crore?

At 12% returns: ₹10,500/month for 20 years, or ₹6,000/month for 25 years. Starting earlier dramatically reduces how much you need to invest each month — that's compounding doing the work.

Is SIP better than lump sum investing?

For most salaried earners, SIP is the only realistic option — you don't have a lump sum sitting idle. If you do receive a large windfall during a market crash, investing it all at once can outperform. In normal or rising markets, SIP and lump sum give similar results over the long run.

Direct vs regular mutual fund — does it matter?

Yes, significantly. A 1% annual cost difference on ₹5,000/month over 20 years costs approximately ₹8–9 lakhs in forgone returns. Use Zerodha Coin, Groww, or Kuvera to invest in direct plans.

What return rate should I assume?

The Nifty 50 has delivered ~13% CAGR since inception. For planning purposes, use 10–11% to be conservative — some decades underperform, and you shouldn't be surprised by a bad 5-year stretch.

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