SIP Calculator

A SIP (Systematic Investment Plan) is a way to invest a fixed amount in mutual funds every month. Because you buy units regularly at whatever the fund's price is, you naturally buy fewer units when prices are high and more when they are low — this "rupee cost averaging" smooths out market ups and downs. The monthly-investment discipline traces back decades, to the earliest mutual-fund savings plans in India from the 1960s, which turned small recurring amounts into a systematic habit long before online fund platforms existed.

How the calculation works

Each monthly contribution earns returns until the end of the period, and those returns compound. This calculator compounds the running balance monthly and credits each month's contribution as it is paid:

FV = P × [(1 + r)ⁿ − 1] / r   (with contributions at each month-end)

• P — your monthly investment
• r — monthly return = expected annual return ÷ 12 ÷ 100
• n — number of months

If you enable a step-up, your monthly contribution increases by that percentage each year — a common strategy that lets small starting amounts grow into large savings as your income grows.

Worked example

Invest ₹10,000 every month for 10 years expecting 12% annual returns:

• r = 0.01, n = 120
• Maturity value ≈ ₹23,00,387

You invest ₹12,00,000 in total and earn roughly ₹11,00,387 in returns. With a 10% yearly step-up, the maturity value rises to about ₹33,40,917 — invested ₹19,12,451, returns ≈ ₹14,28,426. The 10% step-up is a meaningful ~45% lift over the flat SIP, because the extra contributions arrive mid-period and compound for years.

The compounding timeline

The same ₹10,000/month at 12% looks very different across horizons:

• 5 years → ≈ ₹8.17 lakh (invested ₹6 lakh; returns ₹2.17 lakh)
• 10 years → ≈ ₹23.00 lakh (invested ₹12 lakh)
• 20 years → ≈ ₹98.93 lakh (invested ₹24 lakh; returns ~₹74.93 lakh)

The 20-year number is roughly 4.3× the 10-year number while only 2× the money was invested — that extra gap is pure compounding, and it is why "start early" beats "invest more" in most real conversations.

Rupee cost averaging in the real world

In a month when the market falls 10%, your fixed ₹10,000 buys ~11% more units than in a flat month. Over volatile years, those bargain purchases drag your average cost below the market's average price — the core value of SIPs. The discipline also removes the worst investor behaviour: trying to time the market. A delayed lump sum at the "wrong" moment can underperform a boring monthly SIP that was simply on time every month.

Important caveat

SIPs invest in the market, so returns are not guaranteed. The 12% default is an expectation, not a promise. Equity funds can fall short of (or beat) that figure depending on the market — this calculator helps you plan, but past performance never guarantees future results. Long horizons (7 years and beyond) are where equity SIPs have historically delivered their value; short-term SIP money belongs in RDs or debt funds instead.