About SIP Calculator
A SIP (Systematic Investment Plan) calculator helps you estimate the potential returns from investing a fixed amount regularly in mutual funds. SIP is one of the best ways to create long-term wealth through disciplined investing.
Formula Used
FV = P × [(1 + r)^n - 1] / r × (1 + r)
Where FV = Future Value, P = Monthly Investment, r = Expected Monthly Rate of Return, n = Number of Months
Tips & Best Practices
- Start early - compounding works best over long periods
- SIP averages out market volatility through rupee cost averaging
- Even Rs. 500/month can create significant wealth over 20+ years
- Don't stop SIP during market downturns - that's when you buy more units
- Review and increase your SIP amount annually
Frequently Asked Questions
What is SIP?
SIP (Systematic Investment Plan) is a method of investing a fixed amount regularly in mutual funds, allowing you to build wealth gradually while averaging out market volatility.
What is the minimum SIP amount?
Most mutual funds allow SIP starting from Rs. 500 per month, with some offering options as low as Rs. 100.
Is SIP better than lump sum investing?
SIP is generally better for most investors as it reduces timing risk and enforces discipline. However, lump sum can be better during market bottoms if you can time correctly.
Can I stop my SIP anytime?
Yes, SIPs can be stopped anytime without any penalty. You can also pause and restart them as per your convenience.