What is a SIP Calculator?
A SIP (Systematic Investment Plan) calculator estimates the future value of regular monthly investments in a mutual fund. You enter the monthly amount, the expected annual return, and the investment period. The calculator applies a compound interest formula to project your final corpus, the total amount invested, and the wealth gained from compounding.
SIPs are how most retail investors in India build long-term wealth: small amounts go in every month, the units bought average out across market cycles (this is called rupee-cost averaging), and compounding on the cumulative balance does the heavy lifting over 10+ years.
SIP Formula
SIP returns are computed using the future value of an annuity (compounded monthly). For an investment paid at the start of each month (the standard convention used by most Indian AMCs), the formula is:
FV = P × ((1 + r)n − 1) / r × (1 + r)
- FV = future value (your final corpus)
- P = monthly investment amount
- r = effective monthly rate of return,
(1 + annual rate)1/12 − 1. At 12% a year this is about 0.9489% a month, so twelve months of growth compound to exactly 12%. - n = total number of monthly contributions (years × 12)
The same formula also gives you the total amount invested (P × n) and the wealth gained (FV − P × n). Read the full derivation on our SIP methodology page.
Worked Example
Suppose you invest ₹10,000 a month for 10 years at an expected annual return of 12%. Plugging into the formula:
- P = 10,000
- r = (1.12)1/12 − 1 ≈ 0.0094888
- n = 10 × 12 = 120, so (1 + r)120 = (1.12)10 ≈ 3.1058
- FV = 10,000 × ((1 + r)120 − 1) / r × (1 + r) ≈ ₹22,40,359
You will have invested ₹12,00,000 of your own money and earned about ₹10,40,359 in wealth gain, close to the amount you contributed, purely from compounding. Try the calculator above with these inputs to verify.
Some SIP calculators divide the annual rate by 12 instead (r = 1% a month at 12%). That compounds to about 12.68% a year, not 12%, and would show roughly ₹23.2 lakh for the same inputs. We use the effective monthly rate so the return you enter is the annual return you actually get.
How to use this SIP calculator
- Enter your monthly investment. Most Indian funds let you start with ₹500. Use the slider or pick a preset (₹1K, ₹5K, ₹10K, ₹25K).
- Set the expected annual return. Equity funds have historically delivered 11 to 13% over 10+ years in India; debt funds 6 to 8%. The 12% default is a long-term equity proxy. Adjust based on the fund category you are considering.
- Choose your investment period. Longer is almost always better. Compounding works exponentially, not linearly. The chart shows how the gap between invested and returns widens after year 8 to 10.
- Toggle "Compare scenarios" to put two SIPs side-by-side (e.g. ₹10K @ 12% for 15y vs ₹20K @ 12% for 10y) and see which builds more corpus.
- Toggle inflation at the bottom of the Results card to see what your corpus is worth in today's rupees. At 6% inflation, ₹1 crore in 20 years is worth roughly ₹31 lakh today.
SIP projection at 12% annual return
Quick reference for how monthly amount and tenure compound, using the same formula above at a constant 12% annual return:
| Monthly SIP | 5 years | 10 years | 15 years | 20 years | 25 years |
|---|---|---|---|---|---|
| ₹5,000 | ₹4.1L | ₹11.2L | ₹23.8L | ₹46L | ₹85.1L |
| ₹10,000 | ₹8.1L | ₹22.4L | ₹47.6L | ₹92L | ₹1.7Cr |
| ₹20,000 | ₹16.2L | ₹44.8L | ₹95.2L | ₹1.8Cr | ₹3.4Cr |
| ₹50,000 | ₹40.6L | ₹1.1Cr | ₹2.4Cr | ₹4.6Cr | ₹8.5Cr |
Figures are illustrative and assume a constant 12% annual return compounded monthly at the equivalent effective rate. Actual returns will vary with market conditions, fund performance and expense ratios.
Common mistakes the calculator does NOT model
Be aware of what this calculator deliberately leaves out so you can interpret the result honestly:
- Expense ratio: actively managed equity funds charge 1.5 to 2.0% per year. A 12% gross return becomes a 10 to 10.5% return in your hands. Direct plans are cheaper than regular plans.
- Exit load: most equity funds charge ~1% if you redeem within a year. Not relevant for true long-term SIPs but matters if you stop early.
- Tax: equity LTCG above ₹1.25 lakh is taxed at 12.5% (FY26 rates); STCG (units held under 1 year) at 20%. Debt fund gains are taxed at your slab rate. Plan redemptions accordingly.
- Sequence-of-returns risk: this calculator uses a constant 12% return, but real markets are volatile. Two SIPs with the same average return but different sequences can end with different corpuses. Use SIP precisely to ride that out.
- Inflation: corpus shown is in nominal rupees. Toggle inflation in Results to see real (today's rupee) value.
Is a 12% SIP return realistic?
Looking at the Nifty 50 TRI from inception (1996) to 2025, the index has delivered roughly 13.5 to 14% CAGR. Diversified active equity funds (large-cap, flexi-cap) have averaged 11 to 13% over 15+ year windows. So 12% is a sensible long-horizon proxy for equity SIPs but should not be assumed for short (under 5 year) horizons or for debt and hybrid categories. For debt funds, use 7 to 8%; for arbitrage and conservative hybrid, 6 to 7%.
Related calculators
- Step-up SIP Calculator - model a SIP that increases by a fixed % every year (e.g. as your salary grows).
- Lumpsum Calculator - compare a one-time investment against a SIP for the same horizon.
- PPF Calculator - project your tax-free PPF maturity over the standard 15-year lock-in.
- Net Worth Calculator - track the SIP corpus you have built up against your total assets and liabilities.