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What Exactly is an SIP Calculator?

An SIP Calculator serves as an internet-based instrument designed to compute the returns on your mutual fund investment made through SIP. It operates by taking into account an approximate rate of return and the anticipated future value of your investment over a specified number of years.

Performing this Calculation manually can be somewhat laborious, particularly due to the monthly nature of SIP contributions. Because each monthly contribution has a distinct holding period at any given time, the returns for each of these payments will also vary.

How Can an SIP Calculator Assist You?

The SIP calculator provides investors with a breakdown of the future value of their SIP Investment, offering two key figures: the anticipated return on investment and the principal amount.

Hence, by utilizing the SIP Return Calculator, you can gain insight into the growth trajectory of your investment over a specific holding period, considering a predetermined rate of return and SIP contributions.

Additionally, although not explicitly stated, you can incorporate the impact of inflation when using the online SIP calculator. This can be achieved by manually determining the nominal rate of return based on your desired real rate of return and the current inflation rate. Subsequently, you can input this calculated rate of return into the calculator to initiate mutual fund investments.

Let's explore some examples to illustrate how this calculator can be beneficial.

How Does an SIP Returns Calculator Operate?

Even though you can easily access an SIP Calculator online to perform the computations, it's beneficial to understand the underlying process to bolster your confidence in your investment strategy.

SIP calculators utilize the following formula:

FV = P x {[(1 + r)^n – 1] ÷ r} x (1 + r)

Where:

FV: Future value of investment

P: Principal contributions each month

r: Expected rate of return (per month)

n: Number of contributions towards the principal

For example, if you aim to compute the future value (FV) for an SIP with monthly contributions of ₹1,000 over two years, with an expected rate of return of 12%, the formula would be as follows:

FV = 1000 x {[(1 + 0.01)^24 – 1] ÷ 0.01} x (1 + 0.01)

Please note that 'r' is represented as 0.01 because the expected rate of return is 12% per annum, which translates to 1% per month.

Benefits of SIP Calculator

Investing in market-linked instruments like Mutual Funds doesn't guarantee returns, making it challenging for investors to forecast future growth or determine the necessary investments to achieve financial objectives.

The AssetPlus SIP Investment Calculator offers the following significant advantages to investors:

Instant Calculation of Investment Future Value: The  AssetPlus SIP Calculator provides immediate and accurate results, eliminating the need for manual calculations.

User-Friendly Interface: Estimate your investment requirements effortlessly with our user-friendly SIP Calculator, suitable for all users, and it's completely free and unlimited.

Facilitating Informed Investment Decisions: Plan your investments effectively using the SIP Calculator to ensure seamless attainment of your financial objectives.

Exploration of Premier Investment Opportunities: In addition to forecasting future values and monthly investments, our calculator suggests funds that align with your goals, distinguishing it from others.

Access to Inflation-Adjusted Results: Combatting escalating expenses is made easier by effortlessly obtaining inflation-adjusted investment results with a simple click, a feature absent in most SIP calculators.

FAQ - Best Platform for Mutual Fund Distributors in India

What is the Investment Limit for SIP?

There is no maximum limit to the amount you can invest in a SIP. The minimum investment amount allowed is Rs 500 per month.

What is the Longest Duration for a SIP?

There is no maximum tenure for a SIP. You can continue investing for as long as you prefer. The minimum tenure available is 3 years.

Can I Adjust my SIP Contribution?

Yes, you have the flexibility to adjust your SIP amount at any time. You can use the SIP investment calculator to assess your returns and make changes accordingly, whether increasing or decreasing the SIP amount.