SIP Calculator

What is a SIP?

A Systematic Investment Plan (SIP) is a way of investing a fixed amount in a mutual fund at regular intervals — usually every month — and is one of the most popular ways to build long-term wealth in India. Instead of timing the market with one big lump sum, you invest steadily, which spreads your purchase cost across market highs and lows. This is known as rupee-cost averaging. If you have a large amount ready to invest at once, compare the outcome with our Lumpsum Calculator.

Mutual fund calculator: SIP or lumpsum?

People searching for a mutual fund calculator usually want one of two different things, and the answer depends on how the money goes in. If you invest a fixed amount every month, that is a SIP and this page is the calculator you want. If you invest a single amount once and leave it, that is a lumpsum. The fund is identical; only the schedule differs, and the schedule changes the outcome more than most people expect.

The same total money makes the point. Put ₹10,000 a month into a fund returning 12% for ten years and you invest ₹12 lakh and finish near ₹23.2 lakh. Had you been able to invest that entire ₹12 lakh on day one instead, the same fund and the same ten years finishes near ₹37.3 lakh — because every rupee compounded for the full decade rather than arriving gradually.

That does not make SIPs inferior. Almost nobody has the lump sum on day one, and a SIP is what turns a monthly salary into an investment habit. It does mean the honest comparison is against what you would realistically have done otherwise, not against a lump sum you never had. If you do hold a windfall, the SIP vs lumpsum comparison runs both on your own numbers.

How the SIP calculation works

This calculator uses the standard future-value formula for a monthly investment made at the start of each period:

FV = P × ( ((1 + i)^n − 1) ÷ i ) × (1 + i)

• P — your monthly investment amount
• i — monthly rate of return = expected annual return ÷ 12 ÷ 100
• n — total number of contributions = years × 12

That formula projects forward from a return you assume. To measure the return you actually achieved — where every instalment went in on a different date and has been compounding for a different length of time — you need XIRR, not this. It is the only measure that weights each instalment by how long it was really invested.

How much can a monthly SIP grow to?

The table below shows the approximate maturity value of a monthly SIP at an assumed 12% annual return over different horizons, from a ₹1,000 starter SIP up to ₹30,000 a month. It assumes each instalment is invested at the start of the month, exactly as this calculator does. Notice how the corpus grows far faster in the later years — that is compounding doing the heavy lifting.

Reading a few of those directly, since these are the questions people actually ask: a ₹1,000 monthly SIP for 10 years reaches about ₹2.3 lakh on ₹1.2 lakh invested. ₹2,000 a month for 5 years reaches about ₹1.6 lakh. ₹30,000 a month for 5 years reaches about ₹24.7 lakh on ₹18 lakh invested, and the same ₹30,000 held for 20 years reaches roughly ₹3 crore. A ₹10,000 SIP crosses ₹1 crore at almost exactly 20 years.

These figures assume a steady 12% return; real equity returns swing year to year. A corpus 20–25 years away will also buy less because of rising prices — use the Inflation Calculator to see what it is worth in today's money.

The cost of starting late

Delaying a SIP is one of the most expensive money mistakes, because you forfeit the years when compounding is most powerful. Compare two investors who each put in ₹10,000 a month at 12%:

• Investor A stays invested for 25 years and ends with roughly ₹1.90 crore (₹30 lakh invested).
• Investor B starts five years later and invests for 20 years, ending with about ₹99.9 lakh (₹24 lakh invested).

Step-up SIP: grow your investment with your income

A step-up (or top-up) SIP raises your monthly contribution by a fixed percentage every year — say 10% — so your investing keeps pace with salary hikes. The effect is dramatic. A flat ₹10,000 SIP at 12% for 20 years grows to about ₹1 crore, but the same SIP stepped up 10% each year reaches nearly ₹2 crore over the same period. Because the larger instalments land in the later years, a step-up back-loads your contributions — that money compounds for less time, so nearly all of the extra corpus comes from investing more rather than from a better schedule. It is still a simple way to invest more without feeling the pinch upfront.

Direct vs regular plans and the expense ratio

Every mutual fund comes in two variants. A regular plan pays a commission to the distributor who sold it, and that cost is baked into the fund's annual expense ratio. A direct plan cuts out the middleman, so its expense ratio is lower — often by around 0.5% to 1% a year. That gap sounds trivial, but over 20–25 years a 1% annual drag can quietly shave several lakh rupees off your final corpus. If you are comfortable selecting funds yourself, the direct plan of the same scheme leaves more money compounding for you.

How SIP returns are taxed

Each SIP instalment is treated as a separate purchase, and its holding period is counted from its own date on a first-in, first-out basis. For equity-oriented funds:

• Long-term gains (units held more than 12 months) are taxed at 12.5%, and the first ₹1.25 lakh of long-term gains in a financial year is exempt.
• Short-term gains (units held 12 months or less) are taxed at 20%.

Debt-oriented funds are generally taxed at your income-tax slab rate. Tax provisions change from time to time, so confirm the current rules before you redeem.

Why the power of compounding matters

The longer you stay invested, the more your returns earn returns of their own. A small increase in tenure often adds far more to your final corpus than a similar increase in the monthly amount, because compounding has more time to work — the same engine behind our Compound Interest Calculator. And once your corpus is built, you can plan steady monthly withdrawals from it using the SWP Calculator.

How to use this calculator

1. Set your Monthly Investment — the amount you can commit every month.
2. Enter an Expected Return that is realistic for your fund category.
3. Choose the Time Period you plan to stay invested.
4. Instantly see your invested amount, estimated returns and total maturity value.

Tips to get the most from your SIP

• Start early — even a few extra years dramatically boost the final corpus.
• Step up over time — raise your SIP amount as your income grows.
• Stay invested — avoid stopping SIPs during market dips; that's when you buy more units cheaply.
• Be realistic on returns — equity funds are volatile; use conservative estimates for planning. You can check a fund's actual historical annualised return with the CAGR Calculator.