A lot of people think SIP and Mutual Funds are different investment products. Systematic Investment Plan (SIP) is just a method of investing in Mutual Funds usually on monthly basis. Calculate the future value of a monthly SIP
30,00,000(Thirty Lakh)
28,08,477(Twenty Eight Lakh Eight Thousand Four Hundred and Seventy Seven)
58,08,477(Fifty Eight Lakh Eight Thousand Four Hundred and Seventy Seven)
Disclaimer: The purpose of this calculator is to illustrate and should never be utilized as a tool to decide your investments. One should consult their investment adviser to decide on their investments. We have taken reasonable care to build this calculator, however it does not warrant the completeness or accuracy of numbers. Users are fully responsible/liable for any decision taken based on this calculator. Please refer to the statutory disclaimer under the disclosures on this website.
Systematic Investment Plans (SIPs) are a popular way to invest in mutual funds in India. They allow investors to invest a fixed amount regularly, making it easier to build wealth over time. Our SIP return calculator is designed to help you understand the potential returns on your investments, making financial planning more straightforward and efficient.Â
In India, SIPs come in various forms to suit different investor needs:
A SIP return calculator is a financial tool that helps you estimate the returns on your SIP investments over a specific period. By inputting details like the investment amount, frequency, duration, and expected rate of return, you can get a clear picture of how much your investments could grow.Â
Provides an accurate estimate of potential returns.Â
- Helps in comparing different investment scenarios.Â
- Aids in financial planning and goal setting.Â
- Simplifies the understanding of investment growth over time.Â
- Facilitates better decision-making for investments.Â
ARA’s systematic investment plan calculator offers several benefits:Â
M = P × ({ [1 + i]^n – 1} / i) × (1 + i)
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Where:Â
M: The total amount accumulated at the end of the investment period, including both principal and interest.
P: The amount of money invested in each installment (the periodic investment).
i: The rate of return per period (usually expressed as a decimal). For example, if the annual rate of return is 12%, then i would be 0.01 for monthly calculations.
n: The total number of investment periods (the total number of installments or contributions). For instance, if you invest monthly for 10 years, n would be 120.
Example: Â
Consider the following example to understand how the calculator works:Â
– Your investment would be: Rs. 4.2 lacsÂ
– The Future value of your investment would be: Rs. 6.53 lacsÂ
The table below shows how the power of compounding can increase your returns every year with the same investment amount:Â
| YEAR | Yearly Investment Amount | Total Investment | Expected ROI | Total Returns |
|---|---|---|---|---|
| 2024 | Rs. 60,000 | Rs. 60,000 | 12% | Rs. 4,047 |
| 2025 | Rs. 60,000 | Rs. 120,000 | 12% | Rs. 16,216 |
| 2026 | Rs. 60,000 | Rs. 180,000 | 12% | Rs. 37,538 |
| 2027 | Rs. 60,000 | Rs. 240,000 | 12% | Rs. 69,174 |
| 2028 | Rs. 60,000 | Rs. 300,000 | 12% | Rs. 112,432 |
ARA's SIP calculator allows you to evaluate various SIP return scenarios by offering an estimate of potential future returns. It simplifies the decision-making process by allowing you to input various parameters such as investment amount, frequency, duration, and expected rate of return. This way, you can easily see which product aligns best with your financial goals.
SIP is a method of investing in mutual funds. While mutual funds are investment vehicles that pool money from various investors to purchase securities, SIPs allow you to invest a fixed amount regularly in these mutual funds. This systematic approach helps in averaging the cost of investment and compounding returns over time.Â
SIP returns in mutual funds can be calculated using the SIP calculator formula:Â
M = P × ({ [1 + i]^n – 1} / i) × (1 + i)
By entering the SIP amount, expected rate of return, and number of instalments, you can estimate the future value of your SIP investments.Â
SIP returns are best calculated using XIRR (Extended Internal Rate of Return). This formula is used to calculate the annualized return on investments which have multiple cash flows occurring at irregular intervals.
XIRR = (NPV(Cash Flows, r) / Initial Investment) * 100
Where NPV is the net present value, r is the rate of return, and cash flows are the series of investments and withdrawals over time. This can be easily calculated using the XIRR function in an excel sheet.
Investing Rs. 2000 in Mutual Fund SIP for 40 years can yield substantial returns due to the power of compounding. Using the SIP calculator, you can input the monthly investment amount, expected rate of return, and tenure to estimate the future value of your investment.
Anyone can start investing in SIPs, including salaried individuals, professionals, business owners, and even students with a regular source of income. SIPs are a flexible and accessible investment option suitable for both novice and experienced investors.Â
When choosing a mutual fund for SIP investment, consider factors such as:
- Investment objective
- Time Horizon of your investment
- Suitable Risk for achieving the objective
- Fund's objectives and suitability
- Fund performance and track record
To use an online SIP return calculator, you need to provide details such as:
- SIP amount (monthly investment)
- Expected rate of return (annualized)
- Investment tenure (number of years)
Yes, ARA's SIP calculator offers reliable and precise estimates of your potential SIP returns. The calculator uses a standard formula to compute future values based on the inputs provided, helping you make informed investment decisions. However, it is recommended to consult an expert before taking any investment decisions.
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