SIP Calculator – Systematic Investment Plan Tool

Many investors often confuse SIPs with mutual funds, but SIPs are simply a way to invest in mutual funds. The other method is a lump sum investment. A SIP calculator helps you estimate the potential returns of investing in mutual funds through SIP. Systematic Investment Plans (SIPs) involve investing a fixed amount regularly, whether weekly, monthly, or quarterly.

What is a SIP Calculator?

A SIP calculator is a handy tool that gives an estimate of the returns on mutual fund investments made via SIP. Recently, SIP investments have become a preferred choice for many millennials.

These mutual fund SIP calculators provide potential investors with an approximate idea of returns on mutual fund investments. Keep in mind that actual returns depend on various factors, and SIP calculators do not account for expenses like exit load or expense ratio (if applicable).

This tool estimates the wealth created and the expected returns for your SIP contributions, offering a projected maturity amount based on a specified annual return rate.

How can a SIP Return Calculator Benefit You?

According to financial experts, SIPs are a more effective investment method compared to lump sum investments. They promote financial discipline and encourage regular savings, which can be highly beneficial over time.

A SIP calculator online provides valuable insights, including an estimate of the returns you can expect after your investment tenure.

Key advantages of SIP calculators include:

1. Helps determine the ideal investment amount.
2. Displays the total invested amount.
3. Provides an estimated value of returns.

How Does a SIP Calculator Work?

The formula used for SIP calculations is:

M = P × ({[1 + i]^n – 1} / i) × (1 + i).

Here:

• M represents the maturity amount.
• P is the regular investment amount.
• n is the number of payments.
• i is the periodic interest rate.

For instance, if you invest Rs. 1,000 monthly for 12 months at a 12% annual return:

Monthly rate of return = 12% / 12 = 0.01

Using the formula, M = 1,000 × ({[1 + 0.01]^12 – 1} / 0.01) × (1 + 0.01)

The maturity amount will be approximately Rs. 12,809 in a year.

Note: The returns from SIP investments depend on market conditions and can vary over time.

How to Use IPOtank's SIP Calculator?

Using the SIP amount calculator from IPOtank is simple.

Enter the monthly investment amount, the investment tenure in years, and the expected return rate. The calculator instantly provides an estimate of the maturity amount.

Advantages of IPOtank's SIP Calculator

IPOtank offers a reliable SIP calculator with the following benefits:

• Allows you to plan investments based on your goals.
• Provides an accurate estimation of total investments and returns.
• Saves time by avoiding manual calculations.

With a SIP calculator, you can ensure your savings align with your financial goals and requirements.