Amount Invested
Expected Amount
Wealth Gain
Tenure
One simple tool that users can use to estimate returns on their SIP investments in mutual funds is a SIP calculator. These days, it is one of the popular investment options for millennials.
There are multiple mutual fund sip calculators available to assist potential investors in estimating their investments. Real returns, however, differ depending on a number of variables in a mutual fund scheme. The SIP calculator fails to provide an explanation for the exit load and expense ratio (if any).
Anyone can use the IIFL SIP return calculator in a few simple steps:
Now that you know how to calculate SIP returns, let’s quickly examine its advantages.
Even though you can always locate a SIP calculator online it’s still a good idea to understand how these figures are calculated so you can feel more secure about your investing strategy. Compound interest is a mathematical formula that SIP calculators use to calculate investment returns. The calculator evaluates the returns while taking compounding frequency into account. The SIP calculator also asks users to enter the period of their investment, the estimated rate of return, and the monthly investment amount that they wish to make.
M = P x {[(1+ r)^n – 1] / r } x (1+r)
M is the amount you receive upon maturity
P is the Principal Amount you invest at regular intervals
n is the number of payments you make
r is the expected rate of return
Consider the scenario where you desire to invest Rs1,000 each month for 2 years at an interest rate of 12%.
Therefore, the monthly rate of return comes out to be 12%/12 = 1% = 0.01
Using the above formula in our scenario, we can calculate the maturity value.
Maturity Value = 1,000X ({[1 +0.01] ^ {24} – 1} / 0.01) x (1 + 0.01) = Rs 27,243
If we would have just saved that amount in cash, we would have had Rs 24,000. Hence by investing in a SIP we got an added return of Rs 3,243 over a period of 2 years.
You can use the SIP calculator to determine the predicted returns and wealth growth for your monthly SIP investment. Based on an anticipated annual return rate, you can obtain a rough estimate of the maturity amount for any monthly SIP.
Some mutual fund experts claim that SIP can yield greater returns than lump-sum investments. You can develop financial discipline and the habit of setting aside money for the future with the help of SIP investments.
Here are the benefits of using a Mutual Fund SIP Calculator:
Here’s a table showing estimated monthly and annual returns for different SIP investment scenarios:
Investment Amount (₹) | Expected Annual Return (%) | Monthly SIP Returns (₹) | Annual SIP Returns (₹) |
1,000 | 10% | 1,100 | 13,200 |
5,000 | 12% | 5,600 | 67,200 |
10,000 | 15% | 11,500 | 138,000 |
20,000 | 18% | 23,600 | 283,200 |
Returns depend on market conditions and fund performance
Investors often make mistakes that reduce SIP effectiveness. Starting late is a common error—early investments benefit from compounding. Stopping SIPs during market downturns is another mistake; SIPs work best when consistent. Investing without clear goals leads to poor fund selection. Ignoring fund performance can result in low returns. Over-diversification reduces gains, while not increasing SIP amounts over time limits growth. Trying to time the market defeats SIP’s purpose. Skipping research before selecting funds can lead to losses. Avoiding these mistakes ensures better long-term returns
Within a few clicks, you can utilize the IIFL Capital Services SIP amount calculator online. The following information must be entered using this method to calculate the monthly investment amount:
Step Up is an annual increase in the investment amount that corresponds to the growth in the investor’s income. In other words, investors are allowed to ratchet up their SIP investments by a certain percentage each year.
This makes it easier to reach financial objectives quickly and methodically. Generally speaking, the step-up percentage should match the increase in the employee’s yearly salary.
An SIP calculator is a powerful financial tool that simplifies investment planning. It helps investors estimate future returns based on contributions and tenure. While actual results depend on market performance, disciplined investing through SIP ensures long-term wealth creation and financial security.
If you want to know how much your mutual fund investment will be worth in the future based on your monthly contributions, the length of time you plan to invest, and the predicted return, you can use a SIP calculator.
In order to predict the growth of an investment, it takes into account the length of time, the monthly contributions, and the predicted annual return using a compounding-based mathematical formula.
Market performance determines SIP returns, no. But equity mutual funds have a track record of producing healthy returns when looking at the big picture.
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