Calculate Potential Wealth
How the SIP Calculator Works
A Systematic Investment Plan (SIP) lets you invest a fixed amount at regular intervals - Monthly, Quarterly, Half-Yearly, or Yearly - into a mutual fund. Our SIP Calculator applies the standard Future Value formula: FV = P × ([(1 + i)ⁿ − 1] ÷ i) × (1 + i), where P is the periodic investment, i is the periodic interest rate (annual rate ÷ frequency), and n is the total number of instalments. The Lumpsum mode uses compound interest: FV = P × (1 + r/100)ⁿ. The growth chart plots your invested amount vs total corpus year by year, letting you visualise compounding in action.
Adjust the three sliders - Investment Amount, Expected Return (% p.a.), and Time Period (Years) - to instantly see how each variable affects your maturity value and total gain percentage. Switching between SIP and Lumpsum modes lets you compare both strategies side by side for the same inputs.
The Formulas — SIP & Lumpsum Explained
SIP (Systematic Investment Plan)
M = P × [(1 + i)ⁿ − 1] / i × (1 + i)
where i = Annual Rate ÷ 100 ÷ Frequency and n = Years × Frequency. The trailing (1 + i) applies because SIP contributions are made at the start of each period.
Lumpsum (One-Time Investment)
M = P × (1 + r/100)ⁿ
where r is the annual return rate and n is the number of years.
| Variable | Meaning | SIP (₹5,000/mo · 12% · 10yr) | Lumpsum (₹5L · 12% · 10yr) |
|---|---|---|---|
| P | Investment Amount | ₹5,000 per month | ₹5,00,000 (one-time) |
| r | Annual Return Rate | 12% p.a. | 12% p.a. |
| i | Periodic Rate (r ÷ 100 ÷ 12) | 0.01 per month | — |
| n | Total Periods | 120 months (10 yrs × 12) | 10 years |
| Invested (I) | Total Capital Deployed | ₹6,00,000 (₹5,000 × 120) | ₹5,00,000 |
| M | Maturity Value | ₹11,61,695 | ₹15,52,924 |
| Gain | Return on Capital | ₹5,61,695 (93.62%) | ₹10,52,924 (210.58%) |
SIP vs. Lumpsum - Which is Better for You?
Both SIP and Lumpsum are valid investment approaches, but they suit different investor profiles and market conditions:
📅 SIP - Disciplined Regular Investing
Invest a fixed amount at regular intervals regardless of market levels. Benefits from Rupee Cost Averaging - you automatically buy more units when NAV is low and fewer when it is high, reducing your average purchase cost over time. Ideal for salaried investors building wealth from monthly income.
Best for: Salaried individuals, first-time investors, volatile markets, long-term wealth creation (7+ years).
💰 Lumpsum - One-Time Investment
Invest the full amount at once. Generates maximum returns in a sustained bull market since 100% of the corpus compounds from Day 1. However, requires precise market timing - investing at a market peak can reduce returns significantly during the initial years. Higher risk, higher reward potential.
Best for: Windfalls (bonus, inheritance), market corrections, experienced investors with risk tolerance, short bull cycles.
To measure the annualized return of your existing SIP portfolio, use our CAGR Calculator. If you want to explore specific fund categories, our Mutual Fund Returns Calculator breaks down returns by fund type. Once your SIP corpus is built, our SWP Calculator helps you plan a tax-efficient monthly withdrawal strategy in retirement.
SIP Investment Frequencies - Monthly, Quarterly, Half-Yearly, Yearly
This calculator supports all four standard SIP frequencies. Here's how each compares:
📆 Monthly SIP
12 instalments per year. The most popular frequency because it aligns with monthly salaries and maximises the number of compounding cycles. Best for maximising corpus over long periods through more frequent reinvestment.
📅 Quarterly SIP
4 instalments per year (every 3 months). Suitable for freelancers, business owners, or professionals with quarterly income inflows. Slightly lower corpus than monthly due to fewer compounding periods, but manageable cash flow.
📊 Half-Yearly SIP
2 instalments per year. Less frequent, suited to bi-annual income earners or those who receive large milestone-based payments. Corpus is lower than monthly/quarterly due to fewer compounding cycles per year.
🗓️ Yearly SIP
1 instalment per year - equivalent to annual investing. Simplest to manage and useful for annual bonus deployment. Mathematically similar to Lumpsum investing in annual tranches. Lowest compounding frequency among the four options.
📈 Step-Up SIP Strategy
Increase your SIP amount by 10–15% every year in line with your income growth. A ₹5,000/month SIP stepped up by 10% annually can generate 50–70% more corpus over 20 years compared to a flat SIP. While this calculator uses a fixed amount, use it to model future step-up scenarios.
🔄 Reinvestment vs. Withdrawal
This calculator computes Growth Plan returns (all gains reinvested until maturity). If you opt for a Dividend Plan (periodic payouts), your maturity value will be lower. For accurate planning, always project with the Growth Plan and consider dividends as a bonus.
Understanding Your SIP Calculator Results
The results panel displays three key figures and a year-by-year growth chart:
Estimate Maturity Value - The projected total corpus (invested amount + compounded gains) at the end of your chosen time period, assuming a constant annual return rate. This is not guaranteed - actual mutual fund returns vary based on market performance.
Total Investment - The sum of all your individual instalments (SIP amount × number of periods). In Lumpsum mode, this equals your one-time investment. This is the capital you have personally contributed - independent of market performance.
Total Gain - The difference between Maturity Value and Total Investment. The % badge shows your total percentage gain on invested capital (absolute return). A higher expected return rate and longer duration dramatically increase this figure due to compounding.
Growth Chart - The solid blue line shows your total portfolio value growing year by year. The dashed line shows the invested amount accumulating linearly. The widening gap between the two lines is the visual representation of compounding - the longer you wait, the faster the gap grows.
Frequently Asked Questions
What is the minimum amount to start a SIP?
Is it better to start a SIP at the beginning or end of the month?
Can I have multiple SIPs in different mutual funds simultaneously?
How does taxation work on SIP returns?
What is Rupee Cost Averaging and how does it benefit SIP investors?
Should I stop my SIP during a market crash or correction?
Financial Disclaimer
Mutual fund investments are subject to market risks. Please read all scheme related documents carefully before investing. Past performance of the schemes is neither an indicator nor a guarantee of future performance.
The purpose of this calculator is to inform the user and provide estimates. Do not plan your finances based solely on the calculator results.