A systematic investment plan (SIP) means investing a fixed sum every month, usually in a mutual fund. This SIP calculator estimates what those monthly amounts could grow to if they earned a steady yearly return. It is a planning aid, not a forecast: real market returns go up and down and are never guaranteed.
How to use the SIP calculator
- Enter your monthly investment.
- Enter the expected annual return in %. Pick a cautious figure; see the note below.
- Enter the number of years.
- Optionally enter an annual step-up in %, if you plan to raise the monthly amount once a year.
- Read the amount invested, the estimated returns and the total value, and check the year-wise table.
The SIP future value formula
The calculator assumes monthly compounding and that each instalment is invested at the start of the month. The monthly rate is the annual rate divided by 12. For a fixed monthly amount, the future value is:
FV = P × [((1 + i)^n − 1) ÷ i] × (1 + i)
P = monthly investment
i = monthly rate = annual return ÷ 12 ÷ 100
n = number of months = years × 12The last factor, (1 + i), is there because every instalment is invested at the start of its month, so each one earns one extra month of growth compared with an end-of-month plan.
Example. ₹5,000 a month for 10 years at an assumed 12% a year: i = 0.01 and n = 120. You invest ₹6,00,000, and the estimated value is about ₹11.62 lakh, so the estimated gain is about ₹5.62 lakh.
How the annual step-up works
With a step-up, the monthly amount rises by the chosen percentage at the start of each new year. With a 10% step-up, ₹5,000 a month in year 1 becomes ₹5,500 a month in year 2 and ₹6,050 in year 3. The simple formula above no longer applies, so the calculator works month by month instead: it adds the instalment, then applies one month’s growth. In the same example with a 10% step-up, you would invest about ₹9.56 lakh over 10 years, and the estimated value is about ₹16.87 lakh.
Reading SIP calculator results sensibly
- Returns are not guaranteed. Equity funds can fall in value, sometimes for years. A smooth 12% every year does not happen in real markets.
- Order matters. The same average return can give a different final value depending on when the good and bad years come.
- Costs and tax are not included. Expense ratios, exit loads and capital-gains tax reduce what you keep.
- Inflation. ₹11 lakh in ten years will buy less than ₹11 lakh today.
Watch out: Mutual fund investments are subject to market risks. Read the scheme documents, and check the investor resources on SEBI’s investor website. For advice on your own goals, speak to a SEBI-registered investment adviser or a chartered accountant.
Planning a loan instead? Use the EMI calculator. To see how much of your salary is free to invest, try the salary calculator.
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Frequently asked questions
What return should I enter?
There is no correct number. Many people try two or three rates, for example a cautious one and an optimistic one, to see a range instead of one figure. Past returns do not guarantee future returns.
Why does another SIP calculator give a different answer?
Some assume investment at the end of the month, or convert the annual rate to a monthly rate in a different way. This one uses annual rate ÷ 12 and start-of-month investing.
Does the step-up apply every month?
No. The monthly amount goes up once a year, at the start of each new year, by the step-up percentage.
Is tax included in the result?
No. The result is before any tax, fees or exit loads.