Investment / SIP Calculator
Calculate the future value of regular monthly investments — mutual funds, index funds, SIP — at any annual return rate.
Maturity Value
$116,170
Total Invested
$60,000
Total Returns
$56,170
How the SIP calculation works
Each monthly investment earns returns from the month it is made. Earlier investments compound longer, making consistency more valuable than timing. The formula:
- M — Monthly investment amount
- r — Monthly return rate (annual rate ÷ 12)
- n — Number of months invested
- FV — Future value (corpus)
Monthly investment vs corpus size
Investing $500/month at 8% annual return over different time horizons:
| Years | Total Invested | Returns | Corpus |
|---|---|---|---|
| 10 years | $60,000 | $31,472 | $91,472 |
| 20 years | $120,000 | $178,593 | $298,593 |
| 30 years | $180,000 | $566,764 | $746,764 |
After 30 years, returns ($566K) dwarf the $180K actually invested — compounding does the heavy lifting.
Start small, stay consistent
The most important factor is not the amount — it is starting early and staying consistent. Increasing your monthly SIP by even 5–10% per year (step-up SIP) can dramatically improve your final corpus without feeling like a large sacrifice in any single year.
Frequently asked questions
What is a SIP calculator?
A SIP (Systematic Investment Plan) calculator estimates the future value of regular monthly investments at a given annual return rate. It shows you the total amount invested, the returns earned through compounding, and the final corpus.
How is SIP return calculated?
SIP future value = M × [(1 + r)^n − 1] / r × (1 + r), where M is the monthly investment, r is the monthly return rate (annual rate ÷ 12), and n is the number of months. Each monthly investment compounds from the month it is made.
What annual return rate should I use?
For broad equity index funds, a commonly used long-term estimate is 7–10% annually (after inflation, 4–7%). For debt funds or bond portfolios, 5–7% is more realistic. For a blended 60/40 portfolio, 6–8% is a common assumption. These are projections, not guarantees.
What is the difference between SIP and lump sum investment?
A lump sum investment puts all money in at once, while SIP spreads investment over time in regular instalments. SIP reduces timing risk through rupee/dollar cost averaging — you buy more units when prices are low and fewer when prices are high. Both strategies can build significant wealth when sustained over long periods.
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