SIP Calculator
A SIP — Systematic Investment Plan — is a fixed amount invested every single month. It's how millions of Indian investors build wealth through mutual funds, and the math is identical to dollar-cost averaging. Type in your numbers and watch the snowball.
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Growth over time
Where the money came from
Year-by-year breakdown
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What is a SIP?
SIP stands for Systematic Investment Plan: you invest a fixed amount every month — say ₹10,000 or $500 — into a mutual fund, automatically. It is the default way India's middle class invests; tens of millions of SIP accounts run every month. In the U.S. the same behavior is called dollar-cost averaging: a 401(k) contribution from every paycheck is a SIP by another name.
The power of a SIP isn't a clever fund-picking trick. It's that the schedule never stops: you buy automatically when markets are euphoric and when they're terrifying, which means you buy more units when prices are low. Over decades, that mechanical discipline plus compounding does the work.
The math behind this calculator
This tool compounds monthly, matching how SIPs actually flow into funds:
where PMT = monthly investment, r = annual return, n = total months.
Contributions are assumed to land at the end of each month. This is the future value of an ordinary annuity — the same formula behind every SIP illustration you've ever seen.
Worked example
Invest $500/month at 10% a year for 20 years. Monthly rate ≈ 0.833%, over 240 months. You put in $120,000 of your own money. Compounding turns it into roughly $379,700 — meaning about $259,700, more than double your contributions, came from growth alone. Stretch it to 30 years and the same $500/month becomes roughly $1.13 million, because the last decade does most of the work.
Caveats worth knowing
- Returns aren't smooth. Equity markets swing wildly; 10% is a long-run average, not a yearly promise. A bad decade early on can leave a real SIP far below the smooth projection.
- Fees quietly compound too. A fund charging 1.5% a year instead of 0.2% can erase a huge slice of the final value over 20+ years. Check the expense ratio.
- Inflation and taxes. This calculator shows pre-tax nominal dollars. Real purchasing power will be lower, and gains are taxed when you sell (rules differ by country — India taxes equity gains differently from the U.S.).
- Currency matters for the diaspora. If you earn in dollars but invest in Indian funds (or vice versa), exchange-rate moves over decades can add or subtract meaningfully from returns.
The SIP formula is the standard future value of an annuity; see the U.S. SEC's compound interest explainer (investor.gov) for the underlying compounding math.