SIP Calculator

Systematic Investment Plan (SIP) Calculator is a user-friendly tool which will help you to calculate the monthly return of SIP investment. This is a Mutual fund Calculator that saves time and efforts of the investor and helps them to make better investment decisions.


What is SIP?

SIP or Systematic Investment Plan, as the name suggest is one of the most disciplined approach to invest into mutual funds. It enables one to inculcate a habit of saving as it can start with as low as sum of INR 500 and gradually build an amount. Also based on your risk profile, you can choose the investment plan to let your money grow. Mostly people invest their disposal money into SIPs and thus you can also go aggressive with kind of money and can really achieve your saving goals much earlier. Best day to invest into your SIP is your salary day set as your SIP date, for then you first save and then spend what is left with you based on your recalculations.

Why you should do a SIP?

One invest into SIPs because of two reasons. First is it tends to inculcate a saving habit into you. Second, it helps you to average out your buying cost investment. So when your stocks are high, you tend to buy lesser units with same amount of money. And when you tend to invest in low market, then you tend to get more amount of same stocks. Hence the market fluctuation does not impact you much. Rather when the stock market is less, you can keep investing and reap its true benefits in long run. These tend to reap good benefits when run in long run and if you have started early, it’s the best thing you could do under financial planning.

Benefits of SIP

The best benefit of a SIP comes from its power of compounding. Small amount of money that you invest, keep growing and adding up over time. So that little sum not only reap you interest but also helps you achieve your financial goals that could be your child's education, your foreign trip or your child's marriage. Say you child is one year now and you start to invest 2000 INR for his studies right from that age every month. SIP tend to give as good as one crore rupees for your child's education as he grows 20 years from now. INR 200 every month seems to be a small amount but now that you have invested it for such a long term religiously, you have built a good corpus with that same amount.

How SIP works?

SIP works in very easy manner. Either you sign up with some investing firm or open your own demat account to invest into SIPs. Both ways you must choose the mutual fund you wish to invest into. These days’ mutual funds come with two plans, that is growth plan or a dividend plan. In one you tend to get paid your dividends whenever you tend to get them from the firm or other way they re-invest that dividend into the same SIP that you have chosen and give you some extra units.

Why SIP is better than Lump Sum Investment?

Most often, we do not have a lump sum amount to invest and it tend to be a burden on us. We all want to save but then we don’t see any value or any place where we can invest our small savings every month until we tend to have a huge amount with us. SIP helps us, invest, and grow our small savings to build large corpus over time. Obviously as you tend to grow your savings you can also start to build up your SIP corpus and investment that you do every month and build and diversify your portfolio as per your growth needs.

Why SIP is better than FD?

These days FDs though are safe version of savings, don’t really give you back more than six percent over long run. Also, they tend to charge you some amount in case you want to liquidate them at any point in time. This is not so regarding SIPs, you can get your money and invest it and liquidate it any time. There is no lock in periods and no charges when you wish to come out of them.