SIP Calculator

A SIP (Systematic Investment Plan) is a fixed amount you invest every month, usually into an equity or index mutual fund. Each installment buys units at that month's price, so you average out your cost over time and earn returns on every contribution.

Most SIP calculators show a huge future balance, but over 20 to 30 years inflation cuts your buying power a lot. Knowing what the money will actually buy helps you invest enough to reach your real goals.

Each monthly instalment is compounded individually from the month it is invested using the future-value-of-annuity formula: FV = P × [((1 + i)^n − 1) / i] × (1 + i), where P is the monthly amount, i is the monthly return rate (annual rate ÷ 12), and n is the total number of months. Your first instalment compounds for the full period while the last one barely compounds at all, which is why doubling your investment period more than doubles the result. For example, $500 a month at a 10% annual return grows to about $103,000 in 10 years but about $382,000 in 20 years, the second decade contributes almost three times as much as the first, from identical deposits. This calculator then also discounts the final figure by 3% inflation so you can see what the corpus will actually buy.

Use a long-run average for the asset class you are actually buying, not last year's number. Broad equity index funds have historically delivered high single-digit to low double-digit annual returns over 15+ year periods depending on the market, this site's regional defaults reflect long-term capital-market assumptions for each country. Two habits keep the plan honest: first, run the calculator at your expected rate and again at 2 percentage points lower, and make sure the plan still works at the lower figure; second, always look at the inflation-adjusted result rather than the headline, because at 3% inflation a large-sounding corpus 25 years from now buys far less than it sounds. Avoid assuming anything above the long-run average of your chosen market, optimistic inputs are the most common way retirement plans quietly fail.