SIP Calculator

A systematic investment plan invests the same amount every month, through rallies and crashes alike, and lets compounding do the heavy lifting. Enter the monthly amount, the expected annual return and the years, and this calculator returns the maturity value, split honestly into what you put in and what growth added.

Small Amounts, Long Runways, One Formula

The SIP’s mathematics is the annuity formula run toward the future: each monthly instalment compounds for the months remaining to it, and the sum of those little futures collapses into FV = PMT × [((1 + i)ⁿ − 1) ÷ i] × (1 + i), with i the monthly return and the final (1 + i) honouring the start-of-month instalment convention. Three levers move the result, in ascending order of power: the amount (linear — double it, double everything), the return (strong, but not yours to command), and the duration (the exponent — the lever that dwarfs the others and the only one fully in the investor’s control). The calculator prints the split — invested versus gains — because the SIP story lives in that split’s migration: early on, gains are a rounding error on your own contributions; late in a long plan, the gains overtake the contributions and the curve’s character changes from saving to harvesting. Every SIP advertisement’s hockey stick is that migration, graphed. The split also disciplines the investor’s mood in a crash: a plan whose gains column is still thin has lost little that was ever really its holder’s — the corpus is mostly returned contributions — while the mature plan’s gains cushion is precisely what a decade of patience purchased, and spending either insight in a panic is how the curve’s promise gets forfeited at the exact moment it was kept.

Worked Example: $500 a Month at 12% for Fifteen Years

The defaults: 180 instalments of $500 — $90,000 out of pocket — at a smooth 12% a year. Maturity value: $252,288, of which the gains are $162,288: the plan’s second half contributed more growth than the investor contributed money in total. Time’s leverage shows in the neighbouring runs: stop at ten years and the value is $116,170 (gains $56,170 on $60,000 in); stretch to twenty and it reaches $499,574 — the last five years alone adding more than the first fifteen’s contributions. And the return assumption’s humility check: at 10% instead of 12%, the fifteen-year figure falls to about $209,000 — the same plan, a fifth poorer, on a two-point change in a number nobody controls. The calculator’s note carries the sequence warning for a reason: these are the smooth-model figures the industry quotes, invaluable for comparing plans and durations, treacherous as prophecies.

Why the Monthly Habit Beats the Occasional Lump

The SIP’s behavioural engine is rupee-cost averaging (dollar-cost averaging in the West): a fixed sum buys more units when prices fall and fewer when they rise, so the average purchase cost trails the average price — a modest mathematical edge that matters less than the discipline it automates. The deeper advantage is temporal: money invested monthly starts compounding months or years before the same money saved toward an annual lump, and the salary-cycle alignment converts investing from a decision (repeatable badly) into a default (repeatable at all). The calculator prices the destination; this section names the road’s real virtue, which is that it gets walked. A lump-sum investor with the full amount on day one still beats the SIP in expectation — the formula’s first instalment compounding longest — and the honest literature says so; the SIP’s crown is among mortals who invest from income, which is nearly everyone reading.

The Retirement Gap, Priced Backwards

The calculator’s most consequential use runs in reverse: start from the corpus a goal demands at a date (a retirement fund, a child’s education), discount it mentally into instalments — the required monthly amount is the target divided by this page’s annuity factor at your assumed return — and the “unaffordable” goal frequently decomposes into a merely stern monthly default, or the stern default exposes the goal’s date as the thing that must move instead. Financial planners call this goal-based investing; households call it the first honest conversation about retirement. Either way its instrument is this formula run backwards with the maturity figure entered first, which is why the page prints the invested-versus-gains split so prominently: the gap conversation is really about how much of the target your contributions must carry and how much compounding can be hired to carry for you.

Related Tools

More from the Finance Calculators hub: the Discounted Cash Flow Calculator — this page’s mirror, pulling future money back to today — and the Net Worth Calculator, where a matured SIP takes its seat on the balance sheet.

Frequently Asked Questions

Is the return figure realistic?

It is an assumption, and the calculator’s label says so on the field itself. Broad equity indices have historically returned roughly 10–12% a year in nominal terms over long horizons in several major markets — the origin of the default — but with decades that halved and decades that doubled it, inflation uninvited, and fund fees and taxes still to leave the room. Planning at a point or two below the historical figure is the profession’s humility convention; planning a retirement on the highest number a fund’s brochure can legally print is the error this page’s split readout quietly discourages.

What is a step-up SIP?

A plan whose instalment rises annually — typically 5–15%, tracking salary growth — and it is the single most effective upgrade the structure admits, because it marries the duration lever to a rising amount lever. Its mathematics is a sum of annuities (each year’s tranche compounding for its remaining months), beyond this page’s three fields; approximate it here by running the calculator at the plan’s average instalment, and refine with the knowledge that the true figure lands slightly below the average-amount run (the larger instalments arrive later and compound less). The approximation’s direction is stated so the estimate errs on the honest side.

SIP or lump sum — which wins?

With the money already in hand and a long horizon, the lump sum wins in expectation — markets rise more months than they fall, so earlier exposure compounds longer — and the calculator proves the mechanism: a lump is an instalment that compounds for all n months. The SIP wins when the money arrives monthly (there is no choice to make), when the investor’s behaviour under a drawdown is the binding risk (the plan that survives is the one not abandoned), or when valuation extremes argue for staged entry. Comparing the two on this page: run the lump as a single future-value at the same rate and duration, and the SIP figure beside it — the gap is the price of the income-shaped arrival of real money.

What happens if I miss or stop instalments?

Mathematically, a missed instalment costs its own compounded future — a $500 instalment skipped in year one of the worked example is about $2,700 missing at maturity — and a stopped plan simply freezes its tranches to compound from their smaller base; the calculator can re-price any restart by treating the accumulated corpus as a lump and the resumed instalments as a fresh, shorter plan. Practically, funds impose no lock-in on ordinary SIPs (tax and exit-load rules aside), and the plan’s fragility is behavioural, not contractual — which returns the reader to the discipline argument above.

How are SIP returns taxed?

It depends entirely on the jurisdiction and the fund type — capital-gains regimes typically tax each instalment’s gains by its own holding period when redeemed (first-in-first-out in many systems), so a SIP’s tax is a stack of little calculations rather than one. This calculator works pre-tax, as its note’s planning framing implies; the maturity figure is the gross destination, and the reader’s local rules take their share at the exit. Any SIP page that prints a post-tax figure without asking your jurisdiction is inventing one.

What is an ELSS or goal-locked SIP variant?

Some SIP vehicles lock each instalment for a statutory term in exchange for a tax deduction (India’s ELSS funds, three years per instalment, are the famous instance) — the lock changes nothing in this page’s arithmetic and everything in the plan’s liquidity: the maturity figure stays, the exit door narrows per-instalment. Variants matter at the margin of plan design, never to the formula, and the calculator’s silence about them is the correct weighting: choose the vehicle for its tax and lock terms in your jurisdiction’s chapter, and price every variant’s destination with the same three fields here.

What return should a debt or hybrid fund SIP assume?

Lower, and steadier: debt funds have historically compounded in the high single digits (roughly 6–8% in many markets’ recent decades) and hybrid funds between debt and equity — and the calculator’s discipline is to enter the assumption that matches the vehicle, not the one that flatters the goal. The gap between a 12% equity assumption and a 7% debt assumption across the worked example’s fifteen years is not a nuance — it is the difference between $252,288 and roughly $159,000 — and choosing the fund whose honest assumption still reaches the goal, rather than assuming the goal into the fastest fund, is the entire craft of matching investments to purposes.

Who popularised the SIP?

The systematic investment plan as a named retail product was built by India’s mutual-fund industry in the 1990s and 2000s — fund houses and the industry association’s investor campaigns turned a payroll habit into a mass movement of tens of millions of monthly accounts — on foundations the West knew as dollar-cost averaging and payroll deduction plans. The calculator’s formula is the annuity mathematics of centuries; the SIP’s contribution is packaging it as an automatic monthly default, which behavioural finance now recognises as the entire ballgame for household wealth.