Disclaimer
- Past performance may or may not be sustained in the future and is not a guarantee of future returns.
- Please note that these calculators are for illustrations only and do not represent actual returns.
- Mutual Funds do not have a fixed rate of return and it is not possible to predict the rate of return.
1
Financial Planning
Helps you plan your investments by estimating the maturity amount.
2
Discipline in Investing
Encourages regular savings and disciplined investment habits.
3
Estimation of Returns
Provides an estimated value of the returns you can expect at the end of the investment tenure.
4
Comparison
Allows you to compare different investment amounts and tenures to choose the best option for your financial goals.
How Do SIP Calculators Work?
The formula used by SIP calculators is:
M = P × ({[1 + i]^n – 1} / i) × (1 + i).
Where:
- M: Maturity amount (the total amount you will receive at the end of the tenure).
- P: Monthly SIP amount (the fixed amount you invest regularly).
- n: Total number of payments (number of months you stay invested).
- i: Monthly rate of interest (annual rate divided by 12).
Example Calculation:
Let’s say you invest Rs. 5,000 per month for 12 months at an annual interest rate of 12%.
- Monthly rate of return (i) = 12/12% = 1 % = 0.01
- Number of payments (n) = 12 months
- Monthly SIP amount (P) = Rs. 5,000
Substitute these values into the formula:
M=5,000×(0.01[(1+0.01)^(12−1)])×(1+0.01)
M =5,000×(0.01[1.126825−1])×1.01
M=5,000×12.6825×1.01
M=64047 (approximately)
So, after 12 months, your investment would grow to approximately Rs. 64047.