What is a SIP Calculator?
A SIP calculator is an online tool that helps you calculate the future value of your investments made through
a Systematic Investment Plan (SIP). A SIP is a type of investment plan where you invest a fixed amount of
money at regular intervals, usually monthly, in a mutual fund or other investment vehicle.
Why Use a SIP Calculator?
- Helps you make informed investment decisions by giving you an idea of how much your investments can grow
over time.
- Helps you plan your investments and set financial goals.
- Helps you compare different investment options and choose the best one for your needs.
- Helps you understand the impact of different investment frequencies and amounts on your returns.
- Helps you make adjustments to your investment plan as needed.
How to Use a SIP Calculator
- Enter the amount you want to invest each month.
- Enter the expected rate of return on your investment.
- Choose the time period of your investment (e.g. 5 years, 10 years, etc.).
- Calculator will show you the invested amount, estimated returns and total value of your investments.
Example
Let's say you want to invest ₹10,000 per month in a mutual fund for 10 years, and you expect a rate of return
of 12% per annum. Using a SIP calculator, you can calculate the future value of your investments as follows:
- Monthly investment: ₹10,000
- Expected rate of return: 12% per annum
- Time period: 10 years
The SIP calculator will show you that your total investment of ₹12,00,000 (₹10,000 x 12 x 10) can grow to
approximately ₹23,23,391 over 10 years, assuming an annual rate of return of 12%.
Frequently Asked Questions (FAQs)
- What is the benefit of using a SIP calculator?
- A SIP calculator helps you plan your investments and make informed decisions by giving you an idea of how
much your investments can grow over time.
- How accurate is the SIP calculator?
- The SIP calculator is based on assumptions and actual results may vary. However, it can give you a rough
idea of how much your investments can grow over time.
- Can I use the SIP calculator for other types of investments?
- Yes, you can use the SIP calculator for other types of investments, such as stocks, bonds, or real estate,
by adjusting the expected rate of return and other parameters accordingly.
- Is this SIP calculator free to use?
- Yes, the SIP calculators is free to use.