Investing regularly is one of the smartest ways to build wealth in India. A Systematic Investment Plan (SIP) allows investors to invest a fixed amount every month in mutual funds.
But how do you know how much your SIP will grow in 10 or 20 years?
That's where a SIP Calculator becomes essential.
In this guide, we will cover:
- What is SIP?
- How SIP Calculator works
- SIP formula
- Real examples
- Benefits of SIP
- Tax rules in India
- FAQs
What is SIP?
A Systematic Investment Plan (SIP) is a method of investing a fixed amount regularly in mutual funds instead of investing a lump sum.
For example:
- ₹5,000 every month
- ₹10,000 every month
- ₹2,000 every month
SIP promotes disciplined investing and reduces market timing risk.
What is a SIP Calculator?
A SIP Calculator is an online financial tool that helps you estimate:
- Total invested amount
- Expected returns
- Total maturity value
- Wealth gained
It works using compound interest calculations.
SIP Formula
The formula used in SIP calculation:
M = P × [ (1 + r)^n – 1 ] / r × (1 + r)
Where:
- M = Maturity amount
- P = Monthly investment
- r = Monthly rate of return
- n = Number of months
Don't worry — our SIP calculator automatically calculates this for you.
Example: ₹5,000 SIP for 20 Years
Let's assume:
- Monthly Investment: ₹5,000
- Expected Return: 12% per year
- Duration: 20 years
Result:
| Amount | |
|---|---|
| Total Invested | ₹12,00,000 |
| Estimated Returns | ₹37,95,000+ |
| Total Value | ₹49,95,000+ |
That's the power of compounding.
Benefits of SIP Investment
1. Power of Compounding
The longer you stay invested, the higher your returns.
2. Rupee Cost Averaging
You buy more units when market is low and fewer when high.
3. Disciplined Investing
Automatic monthly investment builds habit.
4. Affordable
Start SIP with as low as ₹500 per month.
5. Flexible
Increase, decrease, or stop anytime.
Types of SIP
- Regular SIP
- Step-Up SIP
- Trigger SIP
- Flexible SIP
- Perpetual SIP
Who Should Invest in SIP?
- Salaried individuals
- Young investors (20–35 years)
- Long-term wealth builders
- Retirement planners
- Parents saving for children education
SIP vs Lump Sum Investment
| SIP | Lump Sum | |
|---|---|---|
| Investment | Monthly | Once |
| Risk | Lower | Higher market timing risk |
| Best for | Salary earners | Large capital |
Tax Rules on SIP in India (2026)
SIP taxation depends on fund type:
Equity Mutual Funds
- Less than 1 year → 15% STCG
- More than 1 year → 10% LTCG (above ₹1 lakh)
Debt Mutual Funds
- Taxed as per income slab
How to Use SIP Calculator on Our Website
- Enter monthly investment amount
- Select expected return rate
- Choose investment duration
- Click Calculate
You'll instantly see:
- Total invested
- Wealth gained
- Final maturity value
Tips to Maximize SIP Returns
- Start early
- Increase SIP annually
- Stay invested during market crash
- Choose good mutual funds
- Avoid panic selling
FAQs – SIP Calculator & Investment
Q1. Is SIP safe?
SIP itself is not an investment, it's a method. Safety depends on the mutual fund selected.
Q2. Can I stop SIP anytime?
Yes, you can pause or stop SIP anytime.
Q3. What is minimum SIP amount?
Most funds allow SIP starting from ₹500.
Q4. Is SIP better than FD?
SIP offers higher return potential but with market risk. FD gives fixed but lower returns.
Q5. Can I become crorepati with SIP?
Yes, with long-term investing (20–30 years), it is possible.
Conclusion
A SIP Calculator is a powerful financial planning tool that helps you understand the future value of your investments.
Whether you are a beginner or experienced investor, SIP is one of the best ways to build long-term wealth in India.
Start small. Stay consistent. Let compounding work for you.