SIP Calculator- Calculate the Returns on Your Mutual Fund Investments
Do you know Systematic Investment Plan (SIP) enables investors to make regular investments in a programme automatically or manually? Yes, they will be able to invest little sums through this system, which will ultimately add up and be quite beneficial in the long term.
Do you need to start investing a certain monthly amount to reach your goal by the deadline? For that, we have the SIP Calculator. But before we discuss how the SIP Calculator works, let us discuss what is meant by SIP:
What is meant by a Systematic Investment Plan?
A Systematic Investment Plan (SIP), also referred to as SIP, is a tool provided by mutual funds to help investors make disciplined investments.
The SIP option enables an investor to make fixed investments in the mutual fund scheme of their choice at predetermined intervals.
The predetermined SIP periods might be weekly, monthly, quarterly, semi-annually, or annually.
Due to average costing and the power of compounding, an investor who chooses the SIP way of investing can do it in a time-bound manner without bothering about the state of the market.
For instance, let's say you wish to save Rs. 5.4 lakhs over three years for a trip abroad. You can conveniently accomplish the aim by beginning a monthly SIP commitment for Rs. 15,000.
The Power of Starting Early!
Treach your goals; the earlier one starts regularly saving and investing.
If you begin SIP at age 25, you can retire with a corpus of about Rs. 2.76 crores. A corpus of about Rs. 1.54 crore would have been available to you at retirement if you had begun SIP five years earlier at age 30, a difference of Rs. 1.21 crore, or the "cost of delaying commencing SIP," would have been.
Yes! So, start investing as early as possible!
The formula for calculating SIP is:
Final Value = Amount Invested [ (1+Rate of Return) ^ Durarion-1] * (1+ Rate of Return)/ Rate of Return.
Consider an investment of Rs 2,000 every month for a period of 24 months. You anticipate a 12% annual rate of return (r).
Rate of Return equal r/100/12, or 0.01
FV = 2000 * [(1.01) ^24 - 1] * (1.01)/0.01= Rs. 54,486
Isn't this formula tough? We also thought so! For this reason, Elearnmarkets has developed a SIP Calculator online for quick calculation.
How do use SIP Calculator Online
You can calculate SIP easily using Elearnmarkets SIP Calculator online as follows:
- Enter How much would you like to invest every month?
- The number of years for which you want to invest?
- The expected annual rate of return?
After that, enter the above numbers, click on "Calculate Now", and you will get the result as follows:
SIP Calculator for Mutual Fund
You can use the same SIP Calculator explained above to calculate SIP for Mutual Funds.
Now that we know what SIP is, how it work and how to use the SIP Calculator Online, let us discuss some FAQs about the same:
How can I calulate my SIP?
The amount you will receive upon maturity or future worth. Consider an investment of Rs 2,000 every month for 24 months. You anticipate a 12% annual rate of return (r). I equal r/100/12, or 0.01.
Can I become rich by SIP?
You can build a 3.53 crore rupee corpus if you invest just Rs 10,000 per month through a SIP in an equity fund over 30 years. Compounding's power increases wealth and helps you become wealthy.
How mutual fund's SIP is calculated?
The SIP approach allows you to invest a set amount in mutual funds on a monthly, quarterly, or semi-annual basis. For instance, if you choose to invest Rs. 2,000 each month via SIP in a mutual fund; you need to make an effort to ensure that you fund the account each month.
What will be the value of 1 crore after 15 years?
Use 2.8 as the division factor to equal 1 crore over 15 years. In other words, in 15 years, the value of one rupee will be equal to (1 crore/2.8) around 36 lakhs rupees.
Is SIP tax-free?
SIPs are among the best tax-saving tools since they offer significant investment returns. Under Section 80(C) of the Income Tax Act of 1961, you may deduct up to Rs. 1.5 lakh from your taxable for investing in ELSS through SIPs.