Systematic Investment Plan (SIP) calculator is an online financial tool that calculates the returns you make on your weekly, monthly & quarterly SIP investment. This calculator lets you enter your weekly, monthly or quarterly periodic investment amount, total period/duration of your investment in years, your expected annual returns and inflation rate(optional).

By enterting these details, this SIP Calculator generates the maturity amount and the gain that you can expect in return after all the regular payments(your Investment). Moreover, it also shows you the projected SIP returns for various time durations.

SIP stands for Systematic Investment Planning. This service is generally offered by the Mutual Fund companies. One has to invest even a small amount of money periodically according to his/her goal of what they want to achieve. It is a passive approach to earn compound money over the years without knowing anything about the market.

How to use SIP Calculator with Inflation?

Mutual fund companies collect money from investors and place it in the market. Investors do not need to worry about market ups and downs. These investments are ideal for the long term, allowing customers to earn maximum compound interest.

To maximize profits from a Systematic Investment Plan (SIP), consider investing at least ₹5,000 per month for 20 to 25 years. This strategy can lead to significant returns over time. For example, if you invest ₹5,000 monthly for 25 years with an expected return rate of around 12% per annum, you could accumulate a substantial corpus.

As of 2024, the market has seen various challenges, including economic impacts due to the pandemic in 2020 and world war tensions. It’s important to factor in inflation when calculating your SIP returns. In 2024, inflation rates were around 6-7%, which means that the actual growth of your investment can be lower than the nominal returns if inflation isn’t considered.

When using an SIP calculator, always adjust the expected return rate to account for inflation. If you expect a nominal return of 12%, with an inflation rate of 6%, your real return would be only about 6%. Therefore, selecting an appropriate inflation rate in your calculations is crucial for understanding the true value of your investments in the future.

• Investor does not have to know very much about the market.
• You can plan and invest according to your own pace and earnings.
• It helps to achieve a planned portfolio in terms of asset allocation.
• One can skip or alter a monthly cycle anytime they need to do so.
• Better returns than many other ways of saving money like Fixed Deposits, Recurring Deposits etc.

Why you should invest in SIP rather than opting for any other investment plan?

SIP is a great way to start investing for those looking for better returns over time. It offers high long-term returns with significant growth and lower market risks compared to other equity investments. There are many reasons why SIP is a better choice than other investments. Let’s explore them:

• Less term and condition : With SIP investment the term and condition are not that complex as compare to other. Here you simply select a mutual fund scheme with the fixed amount that you want to invest per month or per quarter, for a particular period of time. You can choose whether you want to pay manually every month or quarter or you can automate this process by auto debit the fixed amount from your bank.
• Suitable for Middle class people: The SIP investment is more popular among all classes of people because you can invest any amount from 500 per month to any amount you want.
• Skippable Monthly Payment: You can skip the payment of any month, you want. You can pay the amount with the payment of next month.
• Penalty on discontinuing the plan: You can stop your plan anytime you want. There are no penalties for discontinuing the plan.