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SIP Return Calculator

See how your monthly SIP investment grows into wealth through the magic of compounding.

Mutual Funds ELSS Index Funds Compounding

📈 SIP Details

How SIP Returns Are Calculated

A Systematic Investment Plan (SIP) lets you invest a fixed amount in a mutual fund every month. The power of SIP comes from rupee cost averaging (you buy more units when markets are low, fewer when high) and compounding — your returns earning further returns over time.

The SIP maturity formula uses monthly compounding on each instalment:

M = P × {[(1 + r)^n − 1] ÷ r} × (1 + r)

Where:
M = Maturity value
P = Monthly SIP amount
r = Monthly rate of return (Annual rate ÷ 12 ÷ 100)
n = Total number of months (Years × 12)

The Step-Up option in this calculator increases your SIP amount by a fixed percentage each year — mimicking annual salary increments. Even a 5–10% annual step-up dramatically accelerates wealth creation.

Note: This calculator assumes a constant rate of return. Actual mutual fund returns vary with market conditions. The 12% default reflects historical long-term returns of diversified equity mutual funds in India, but past returns do not guarantee future performance.

Why SIP Works for Indians

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Rupee Cost Averaging

By investing the same amount every month, you automatically buy more units when markets fall and fewer when they rise — reducing your average cost per unit.

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Power of Compounding

Einstein called compounding the 8th wonder. A ₹5,000/month SIP at 12% for 20 years grows to over ₹49 lakhs — on just ₹12 lakhs invested.

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Removes Emotional Decisions

SIP automates investing. You don't need to time the market or make decisions during volatile periods — the discipline is built in.

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Step-Up SIP Accelerates Wealth

Increasing your SIP by 10% every year (matching salary hikes) can more than double your corpus compared to a fixed SIP over 15+ years.

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ELSS Saves Tax Too

ELSS mutual funds via SIP qualify for ₹1.5 lakh deduction under Section 80C, with only a 3-year lock-in — the shortest among tax-saving instruments.

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Start Small, Start Now

You can start a SIP with as little as ₹500/month. Starting 5 years earlier can add more to your corpus than doubling the monthly amount 5 years later.

Frequently Asked Questions

What return rate should I use for SIP calculations?
For large-cap equity funds, 10–11% is a conservative assumption. For flexi-cap or mid-cap funds, 12–14% has been historical. Debt funds return 6–8%. For tax-saving ELSS funds, 12% is commonly used. Always plan for a range rather than a single number.
Is SIP return taxed in India?
Yes. For equity mutual funds, gains held less than 1 year are taxed at 15% (STCG). Gains above ₹1 lakh held over 1 year are taxed at 10% (LTCG) — but each SIP instalment has its own purchase date, so LTCG applies instalment by instalment.
Can I pause or stop a SIP anytime?
Yes — most mutual funds allow you to pause SIP for 1–3 months or stop it permanently without penalty. Unlike insurance-linked products, there is no surrender charge. Your existing units remain invested and continue to grow.
What is a Step-Up SIP?
A Step-Up (or Top-Up) SIP automatically increases your investment amount by a fixed percentage each year. For example, starting at ₹5,000/month and stepping up 10% annually means ₹5,500 in year 2, ₹6,050 in year 3, and so on. It aligns with income growth.
Is SIP better than FD in India?
Over a long horizon (7+ years), equity SIPs have historically outperformed FDs significantly — 12%+ vs 6–7%. But SIPs carry market risk and are not capital-guaranteed like FDs. For goals under 3 years, FD or debt funds are safer options.
How is SIP different from lump sum investment?
A lump sum invests all money at once, so your returns depend heavily on the market entry point. SIP spreads investment over time, reducing timing risk. For most salaried Indians, SIP is more practical and psychologically easier than saving up a large amount first.