SIP Calculator
Project what a monthly systematic investment plan could grow into, with the same future-value formula used by every major Indian mutual fund calculator.
How SIP compounding works
Same amount, varying units
A fixed monthly investment buys more units when prices are low and fewer when prices are high, smoothing your average purchase cost over time without needing to time the market.
Why duration matters most
Extending a SIP by even a few years compounds disproportionately — the later years of a long SIP usually contribute more to the final corpus than the early ones.
Returns are assumed, not promised
This calculator projects a constant annual return for simplicity. Real mutual fund returns vary year to year — treat the result as a planning estimate, not a guarantee.
What is a SIP?
A Systematic Investment Plan (SIP) is a method of investing a fixed amount of money into a mutual fund at regular intervals — almost always monthly — instead of investing a large sum all at once. You choose an amount, a mutual fund scheme, and a date each month, and that amount is automatically debited from your bank account and invested in units of that scheme on the same date, month after month.
SIP is not a product you buy. It is a method of buying something else — typically an equity, debt, or hybrid mutual fund. Most Indian fund houses allow a SIP to start as low as ₹500 a month, and you can increase, pause, or stop it at any time without penalty in almost all open-ended schemes.
The appeal of SIP is structural, not magical: it forces consistency. Investing ₹5,000 every month for 20 years is a fundamentally different financial behaviour than trying to invest ₹12,00,000 once and then hoping you never touch it. Most people are far more capable of the former.
How a SIP actually grows your money
A SIP grows your wealth through two distinct mechanisms working together, and it's worth separating them clearly because they're often conflated:
1. Rupee-cost averaging
Because you invest the same amount every month regardless of the unit price (NAV) that day, you automatically buy more units when prices are low and fewer units when prices are high. Over a full market cycle, this tends to smooth out your average purchase cost compared to investing the same total amount in one lump sum at a single, unpredictable point in time.
2. Compounding
Every unit you buy keeps earning returns, and those returns are reinvested to buy more units, which then earn their own returns. This is the part that does the heavy lifting over long horizons. In the first few years of a SIP, your invested amount and your portfolio's value are close to each other. Past the 10–15 year mark, the gap between what you put in and what it's become starts to widen dramatically — not because you started investing more, but because the existing pool was given more time to compound.
Rupee-cost averaging reduces your entry risk. Compounding builds your corpus. A common misunderstanding is to credit all of a SIP's long-term success to "averaging" — in reality, for a SIP held 15+ years, compounding contributes far more to the final number than the averaging effect does.
The SIP formula, explained
This calculator uses the standard SIP future-value formula, the same one used by Groww, Zerodha, HDFC AMC, and effectively every Indian mutual fund SIP calculator:
M = P × [((1+i)n − 1) ÷ i] × (1+i)
- M — the maturity value: what your SIP is worth at the end of the chosen duration.
- P — your fixed monthly investment amount.
- i — the monthly rate of return, calculated as your expected annual return ÷ 12. This calculator uses this simple division — not the geometrically compounded monthly rate — because that's the convention every major Indian SIP calculator follows, and it's what this tool was checked against.
- n — the total number of monthly instalments (years × 12).
The final × (1+i) term exists because this formula assumes each instalment is invested at the start of the month, so it gets one extra month of growth compared to a plain ordinary annuity formula. This small detail is the difference between a calculator that looks "approximately right" and one that matches your actual fund statement.
A worked example, step by step
Suppose you invest ₹5,000 every month for 15 years, expecting a 12% annual return — a commonly used long-term assumption for diversified equity mutual funds in India.
| Step | Value |
|---|---|
| Monthly investment (P) | ₹5,000 |
| Monthly rate (i = 12% ÷ 12) | 1% = 0.01 |
| Total months (n = 15 × 12) | 180 |
| Total amount invested | ₹9,00,000 |
| Maturity value (M) | ₹25,22,880 (approx.) |
Out of a final corpus of roughly ₹25.2 lakh, you contributed ₹9 lakh of your own money — the remaining ₹16.2 lakh came entirely from compounding. That ratio is the entire point of starting early: the longer the runway, the smaller your own contribution becomes relative to what the market does for you.
Plug ₹5,000, 12%, and 15 years into the calculator above — then change only the duration to 25 years and watch the maturity value more than triple, even though your total contribution only grows by 67%. That's compounding, not a calculator quirk.
SIP vs Lumpsum: which is better?
This is one of the most searched comparisons in Indian personal finance, and the honest answer is: it depends on what you're optimising for.
SIP tends to win when…
- You're investing from regular income (salary), not a windfall
- You want to reduce the risk of a single bad entry point
- Markets are volatile or richly valued
- You value the behavioural discipline of automation
Lumpsum tends to win when…
- You already have a large sum sitting idle (bonus, inheritance, maturity proceeds)
- Markets have corrected meaningfully and valuations look attractive
- Your investment horizon is genuinely long (12+ years), reducing the cost of mistimed entry
- You can emotionally tolerate near-term volatility without panic-selling
Academic and industry studies on Indian equity markets generally find that lumpsum investing outperforms SIP in a majority of rolling historical periods — simply because equity markets have risen more often than they've fallen over any long window, and a lumpsum is "all in" from day one. But that statistical edge assumes you actually have a lumpsum sitting around and the nerve to deploy it. For most salaried investors building wealth from monthly income, the realistic choice isn't "SIP vs lumpsum" — it's "SIP vs not investing at all," and SIP wins that comparison easily. Use the Lumpsum Calculator to compare a specific lumpsum scenario directly against this SIP projection.
Step-up SIP: investing more as you earn more
A flat ₹5,000 SIP held for 20 years assumes your capacity to invest never changes — which is rarely true for a salaried professional. A step-up SIP (also called a top-up SIP) increases your monthly instalment by a fixed percentage every year, typically matching expected salary growth (commonly 10%).
The effect compounds on itself: not only do your contributions grow, but the larger contributions made in later years still have meaningful time left to grow too. A step-up SIP starting at the same ₹5,000/month with a 10% annual step-up can produce a dramatically larger corpus than a flat SIP over the same period, without ever feeling like a large jump in any single year. See the Step-up SIP Calculator to model this against your own expected salary growth.
Common SIP mistakes to avoid
- Stopping SIPs during a market fall. This is precisely when rupee-cost averaging is working hardest in your favour — you're buying more units per rupee. Stopping converts a temporary paper loss into a permanently lower unit count.
- Treating the projected return as guaranteed. The 10–12% figures commonly used in SIP calculators are reasonable long-term planning assumptions for diversified equity, not promises. Actual annualised returns over any specific 10–15 year window can be meaningfully higher or lower.
- Confusing SIP with a fixed-return product. A SIP's underlying mutual fund is still market-linked. Unlike a recurring deposit or PPF, the maturity value is an estimate, not a contractual figure.
- Ignoring the expense ratio and exit load. This calculator (like most SIP calculators) shows gross projected returns. Your fund's expense ratio is already reflected in its historical NAV-based returns if you're using a realistic rate assumption, but exit loads on early redemption are not modelled here.
- Under-estimating how much time matters. Delaying the start of a SIP by even 5 years can cost you more in final corpus than doubling the monthly amount later would recover. Starting early, even small, consistently beats starting late and large.
How to use this calculator
- Enter the monthly amount you plan to invest (or already are).
- Set an expected annual return — 10–12% is a commonly used long-term assumption for diversified equity mutual funds in India; use a lower figure for debt or hybrid funds.
- Set the duration in years you intend to stay invested.
- Read the future value, the split between your own contribution and the returns generated, and the year-by-year growth chart.
- Use the Goal Planning Calculator if you want to work backward from a target amount instead — for example, "how much SIP do I need for a ₹50 lakh goal in 10 years?"
Frequently asked questions
No. The future value shown is a projection based on the annual return percentage you enter, assumed constant for the entire duration. Actual mutual fund returns are market-linked, vary year to year, and are never guaranteed. Treat this as a planning estimate to compare scenarios, not a promise of what you'll receive.
Because that's the convention used by Zerodha, Groww, HDFC AMC and effectively every major Indian SIP calculator. We checked this calculator against Zerodha's own published example (₹5,000/month, 12%, 40 years) and it matches to the rupee using the simple annual-divided-by-12 approach, not the more mathematically precise geometric monthly rate.
Most Indian equity mutual fund calculators and advisors use a long-term planning assumption in the 10–12% range for diversified equity funds, based on long-run historical index performance. This is a planning convention, not a forecast — any specific 5 or 10-year window can land well above or below this figure. For debt funds, a more conservative 6–8% is typically used.
Yes. Most mutual fund SIPs in India can be increased, decreased, paused, or stopped at any time without penalty, since SIP is a standing instruction you set up with your fund house or platform, not a locked-in contract (ELSS funds have a separate 3-year lock-in on each instalment, regardless of SIP changes). If you want to model an increasing SIP specifically, use the Step-up SIP Calculator.
The SIP date is when your bank account is debited. The units are typically allotted 1–3 business days later at that day's NAV, depending on the fund category and cut-off time rules set by SEBI. This calculator assumes instalments are invested at the start of each month for simplicity and does not model these processing-day differences, which have a negligible effect over any meaningful duration.
No. The maturity value shown is pre-tax. Equity mutual fund gains held over 1 year are taxed as long-term capital gains (LTCG); shorter holding periods attract short-term capital gains tax. Tax rules and rates are set by the government and can change — this calculator does not model tax, so treat the figures shown as gross, not in-hand, value.
SIP is an investing technique, not a product restricted to mutual funds. The same systematic, periodic-investment principle can be applied to direct equity stocks, gold investment plans, and some recurring deposit-style products, though “SIP” in common usage in India almost always refers to mutual fund SIPs, which is what this calculator is built around.