Enter the total number of years you plan to invest.
Estimate the average annual growth rate of your investment.
Your Investment Projection
Total Investment:
₹0
Estimated Returns:
₹0
Maturity Amount:
₹0
Understanding the SIP Calculator
A Systematic Investment Plan (SIP) is a disciplined way to invest in mutual funds, allowing you to invest a fixed amount of money at regular intervals (typically monthly). This method helps in averaging out the cost of your investments over time, a strategy known as Rupee Cost Averaging, and harnesses the power of compounding to grow your wealth.
How the SIP Calculator Works
The SIP calculator uses a formula to project the future value of your systematic investments based on your inputs. The core of the calculation is the Future Value (FV) of an annuity formula, adjusted for compounding frequency.
The Formula
The formula used to calculate the Maturity Amount of a SIP is:
FV = P * [{(1 + r)^n - 1} * (1 + r)] / r
Where:
FV = Future Value of your investment (Maturity Amount)
P = Periodic Investment (your monthly investment amount)
r = Periodic Interest Rate (annual rate of return divided by 12, then by 100 for decimal form)
n = Number of Periods (investment duration in years multiplied by 12 for months)
The calculator also breaks down the total amount into:
Total Investment: This is the sum of all your monthly investments over the entire duration (Monthly Investment * Number of Months).
Estimated Returns: This is the difference between the Maturity Amount and the Total Investment (Maturity Amount – Total Investment).
Why Use a SIP Calculator?
A SIP calculator is an invaluable tool for financial planning. It helps you to:
Estimate Wealth Creation: Understand how much your investment could grow over time.
Set Financial Goals: Plan for future needs like retirement, a down payment for a house, or your child's education.
Compare Investment Scenarios: Easily adjust your investment amount, duration, or expected returns to see their impact on the final outcome.
Understand Compounding: Visualize the power of compounding, where your returns start generating their own returns, accelerating wealth growth.
Make Informed Decisions: Gain clarity on potential returns before committing to an investment.
Key Factors Affecting Your SIP Returns
Monthly Investment Amount: A higher monthly investment will lead to a larger corpus.
Investment Duration: Longer investment horizons allow for greater wealth accumulation due to compounding.
Expected Rate of Return: Higher returns significantly boost your final maturity amount, but are also associated with higher risk.
Frequency of Investment: SIPs are typically monthly, which helps in averaging costs effectively.
Remember that the rate of return for mutual fund investments is subject to market risks. The figures projected by the SIP calculator are estimates and not guaranteed. It is advisable to consult with a financial advisor for personalized investment advice.
function calculateSIP() {
var monthlyInvestment = parseFloat(document.getElementById("monthlyInvestment").value);
var investmentDurationYears = parseFloat(document.getElementById("investmentDuration").value);
var expectedAnnualReturn = parseFloat(document.getElementById("expectedAnnualReturn").value);
var totalInvestmentDisplay = document.getElementById("totalInvestmentDisplay");
var estimatedReturnsDisplay = document.getElementById("estimatedReturnsDisplay");
var resultDisplay = document.getElementById("result-value");
// Clear previous results
totalInvestmentDisplay.innerText = "₹0";
estimatedReturnsDisplay.innerText = "₹0";
resultDisplay.innerText = "₹0";
// Input validation
if (isNaN(monthlyInvestment) || monthlyInvestment <= 0 ||
isNaN(investmentDurationYears) || investmentDurationYears <= 0 ||
isNaN(expectedAnnualReturn) || expectedAnnualReturn 100) {
alert("Please enter valid positive numbers for all fields. Annual return must be between 0% and 100%.");
return;
}
// Calculations
var numberOfMonths = investmentDurationYears * 12;
var monthlyInterestRate = expectedAnnualReturn / 12 / 100;
var totalInvestment = monthlyInvestment * numberOfMonths;
var maturityAmount;
if (monthlyInterestRate > 0) {
maturityAmount = monthlyInvestment * (Math.pow(1 + monthlyInterestRate, numberOfMonths) – 1) * (1 + monthlyInterestRate) / monthlyInterestRate;
} else {
// If rate of return is 0%, maturity amount is just the total invested
maturityAmount = totalInvestment;
}
var estimatedReturns = maturityAmount – totalInvestment;
// Format currency
var formatter = new Intl.NumberFormat('en-IN', {
style: 'currency',
currency: 'INR',
minimumFractionDigits: 0,
maximumFractionDigits: 0
});
// Display results
totalInvestmentDisplay.innerText = formatter.format(totalInvestment);
estimatedReturnsDisplay.innerText = formatter.format(estimatedReturns);
resultDisplay.innerText = formatter.format(maturityAmount);
}