Everything you need to know about SIP Calculator


As you may know, SIP is one of the best ways of investing in mutual funds. If someone wants to deposit a small amount of money at regular intervals of time, they can get good returns through SIP. coach a person to save on a regular basis.

When we talk about SIP calculator, it helps a person to calculate the amount s/he needs to invest, at a particular growth rate to reach their future target. They can also get an idea about the importance of regular investments and how much return it can really give in the long run.

To give you more information about SIP Calculator, let’s discuss it in details.

What is SIP calculator?

For someone out there who wants to make a successful investment, it is very important to do it in a systematic manner, and SIP Calculator is the answer. An SIP calculator can help the investor to get an idea about their estimated earnings in a specific period of time. If the investor has a goal to fulfill, using SIP calculator can give them an idea about the monthly investment required to achieve that goal.

How does a SIP Calculator work?

When it comes to systematic investment, the money is invested on a fixed date of every month, and the same amount after every deposit tends to generate more effective returns. This process continues till the maturity of SIP. This whole process is known as annuity compounding which makes the complicated calculations easy. It works on the mathematical formula of this particular process. There are 3 parameters which play an important role in the whole process. These are:

  • Expected Return: It is known as annualized rate of return which the investor will get during the selected tenure. It varies from 7% to 35%.Monthly Investment: The investor can select the minimum amount as Rs 500/month to a maximum of Rs 4 lakh/month.
  • Time Horizon: This is the time of the year when the monthly investment is carried out. The investor can choose the tenure of SIP according to their favourability, i.e., 1 year to 30 years.

What are the steps to use SIP calculator to calculate returns?

Following are these steps, you can easily operate SIP calculator:

Step 1. Enter a SIP amount that you want to invest. The minimum SIP amount can be as low as Rs.500/month and as high as Rs.4 lakh/month.

Step 2. Now, evaluate the possible rate of return on the investment. The process gets completed with the help of the fund’s track record.

Step 3. Thirdly and lastly, you are required to enter the investment tenure. It indicates the time for which you want to invest. In some schemes, the minimum tenure is of 6 months, but to get maximum returns it is very important to make a long time investment.

Anyone can use . They can change variables according to their willingness and get an estimate about the returns. It is very important to remember that a SIP calculator doesn’t have any idea of future inflation rates and capital gains tax, so future values can vary.

 What are the benefits of SIP Return Calculator?

  1. SIP Calculator helps the investor to strategically plan their investments. It simplifies the complex calculations and helps them to evaluate future returns.
  2. It is very simple to use. The investor is just required to enter the right details.
  3. It serves the investor with accurate results.
  4. SIP Calculator can be found online and it is easy to use as well as free of cost.

At last, you can say that SIP return Calculator makes calculations easier and faster. Anyone can use this calculator to get an idea of the potential returns on the investment.