SIP Calculator

SIP (Systematic Investment Plan) Calculator is a tool that helps investors calculate the potential returns on their SIP investments. It helps investors to plan their investment portfolio by predicting the amount of wealth they can accumulate over a period of time by investing a fixed amount of money at regular intervals. The SIP calculator is a user-friendly and efficient tool that can provide investors with an estimate of their future wealth and help them make informed investment decisions.

What is a SIP Calculator?

A SIP calculator is an online tool that helps investors calculate the potential returns on their investments in a SIP. It is a simple and easy-to-use tool that can provide investors with an estimate of the wealth they can accumulate by investing a fixed amount of money regularly over a period of time. The calculator uses complex financial calculations to predict the future value of an investment based on factors such as the invested amount, investment period, and expected rate of return.

How does the SIP calculator work?

The SIP calculator uses a simple formula to calculate the future value of an investment. The formula is based on the compound interest principle, which means that the interest earned on an investment is added to the principal amount, and the interest is then calculated on the new total.

The formula used by the SIP calculator is as follows:

FV= P × [(1 + r)^n - 1]/r

• where,
• FV = Future Value of the investment
• P = Monthly Investment Amount
• r = Rate of return per annum/12
• n = Number of years

The SIP calculator takes input values from the user such as the invested amount, investment period, and expected rate of return, and then calculates the potential returns on the investment based on the above formula.

How to Use a SIP Calculator?

To use a SIP calculator, follow these simple steps:

• Visit a SIP calculator website or app.
• Enter the invested amount.
• Enter the investment period in years or months.
• Enter the expected rate of return.
• Click on the "Calculate" button.
• The SIP calculator will then display the estimated returns on the investment based on the input values.

How to start SIP Investment?

To start a SIP investment, follow these steps:

1. Choose a reliable mutual fund house or brokerage firm.
2. Choose a suitable mutual fund scheme.
3. Submit the required documents such as KYC (Know Your Customer) details and bank account details.
4. Decide on the investment amount and the frequency of investment.
5. Set up a mandate with your bank to automatically debit the investment amount from your bank account at regular intervals.

Monitor your investment regularly and make adjustments if necessary.

Is SIP tax free?

SIP investments are not entirely tax-free. The returns earned from SIP investments are subject to taxation. However, SIP investments do provide certain tax benefits to investors. Investments in SIPs for a period of 3 years or more are eligible for long-term capital gains tax, which is currently 10% without indexation. Additionally, SIP investments of up to Rs. 1.5 lakhs per annum are eligible for tax benefits under Section 80C of the Income Tax Act.

Minimum and Maximum SIP Amount?

The minimum and maximum SIP amount vary depending on the mutual fund scheme and the mutual fund house. Generally, the minimum investment amount for a SIP is Rs. 500 per month, while there is no upper limit on the investment amount. However, investors should choose an investment amount that suits their financial goals and risk appetite.

Minimum and Maximum SIP Investment Period?

The minimum and maximum SIP investment period also vary depending on the mutual fund scheme and the mutual fund house. Generally, the minimum investment period for a SIP is 6 months, while the maximum investment period can be as long as 30 years.