Calculate your mutual fund SIP returns and wealth creation
₹0
0.0%
Absolute Returns
₹0
Avg Monthly Gains
| Year | Invested | Cumulative Investment | Yearly Gain | Total Value |
|---|---|---|---|---|
| Year 1 | ₹60,000 | ₹60,000 | ₹4,047 | ₹64,047 |
| Year 2 | ₹60,000 | ₹1,20,000 | ₹12,169 | ₹1,36,216 |
| Year 3 | ₹60,000 | ₹1,80,000 | ₹21,322 | ₹2,17,538 |
| Year 4 | ₹60,000 | ₹2,40,000 | ₹31,636 | ₹3,09,174 |
| Year 5 | ₹60,000 | ₹3,00,000 | ₹43,258 | ₹4,12,432 |
| Year 6 | ₹60,000 | ₹3,60,000 | ₹56,353 | ₹5,28,785 |
| Year 7 | ₹60,000 | ₹4,20,000 | ₹71,110 | ₹6,59,895 |
| Year 8 | ₹60,000 | ₹4,80,000 | ₹87,738 | ₹8,07,633 |
| Year 9 | ₹60,000 | ₹5,40,000 | ₹1,06,475 | ₹9,74,108 |
| Year 10 | ₹60,000 | ₹6,00,000 | ₹1,27,588 | ₹11,61,695 |
Compare returns between investing ₹6,00,000 as a lumpsum vs monthly SIP for 120 months at 12% return.
ROI: 93.6%
ROI: 230.0%
Lumpsum investment generates ₹8,18,537 more returns because the entire amount is invested from day one, allowing it to compound for the full duration. However, SIP has the advantage of rupee cost averaging and doesn't require a large upfront investment.
See how different expected return rates affect your maturity amount with monthly SIP of ₹5,000 for 120 months.
| Return Rate | Total Investment | Returns Earned | Maturity Value | Difference |
|---|---|---|---|---|
| 8% p.a. | ₹6,00,000 | ₹3,20,828 | ₹9,20,828 | +₹9,20,828 |
| 10% p.a. | ₹6,00,000 | ₹4,32,760 | ₹10,32,760 | +₹10,32,760 |
| 12% p.a.(Current) | ₹6,00,000 | ₹5,61,695 | ₹11,61,695 | +₹11,61,695 |
| 15% p.a. | ₹6,00,000 | ₹7,93,286 | ₹13,93,286 | +₹13,93,286 |
| 18% p.a. | ₹6,00,000 | ₹10,81,288 | ₹16,81,288 | +₹16,81,288 |
| 20% p.a. | ₹6,00,000 | ₹13,11,818 | ₹19,11,818 | +₹19,11,818 |
* Higher return rates significantly impact long-term wealth creation due to compounding effect.
Compare how different monthly SIP amounts grow over 120 months at 12% return.
| Monthly SIP | Total Investment | Returns Earned | Maturity Value |
|---|---|---|---|
| ₹1,000 | ₹1,20,000 | ₹1,12,339 | ₹2,32,339 |
| ₹2,000 | ₹2,40,000 | ₹2,24,678 | ₹4,64,678 |
| ₹5,000(Current) | ₹6,00,000 | ₹5,61,695 | ₹11,61,695 |
| ₹10,000 | ₹12,00,000 | ₹11,23,391 | ₹23,23,391 |
| ₹15,000 | ₹18,00,000 | ₹16,85,086 | ₹34,85,086 |
| ₹25,000 | ₹30,00,000 | ₹28,08,477 | ₹58,08,477 |
* Even small increases in monthly SIP can significantly boost long-term wealth due to compounding.
A Systematic Investment Plan (SIP) is an investment strategy that allows you to invest a fixed amount regularly (monthly, quarterly, etc.) in mutual funds. It's one of the most popular and effective ways to build wealth over time through disciplined investing.
Unlike lumpsum investments where you invest a large amount at once, SIP lets you invest small amounts regularly, making it accessible to everyone. It combines the power of compounding with rupee cost averaging to deliver potentially superior returns over the long term.
FV = P × [((1 + r)^n - 1) / r] × (1 + r)
Where:
Example Calculation:
For a monthly SIP of ₹10,000 at 12% annual return for 10 years (120 months):
Buy more units when market is down and fewer when up, averaging your purchase cost over time and reducing market timing risk.
Returns generate more returns over time. The longer you stay invested, the more your wealth multiplies exponentially.
Auto-debit ensures you invest regularly without manual intervention, building a strong savings habit.
Start with as low as ₹500/month. Pause, increase, decrease, or stop anytime without penalties.
No need for large capital. Invest small amounts regularly that fit your budget and financial goals.
Fund managers actively manage your investments, making decisions based on market research and analysis.
| Parameter | SIP | Lumpsum |
|---|---|---|
| Investment Amount | Fixed amount every month | One-time large investment |
| Minimum Investment | ₹500 - ₹1,000 per month | ₹5,000 - ₹10,000 minimum |
| Market Timing Risk | Low (Rupee cost averaging) | High (Entry point critical) |
| Returns in Bull Market | Good, but gradual | Excellent (fully exposed) |
| Returns in Bear Market | Better (buying at low prices) | Negative initially |
| Suitability | Salaried, regular income | Windfall gains, bonuses |
| Flexibility | High (pause/modify anytime) | Limited |
| Best For | Long-term wealth creation | Market corrections/dips |
Tax treatment of SIP returns depends on the type of mutual fund and holding period. Here's what you need to know:
Equity Linked Savings Scheme (ELSS) mutual funds offer the dual benefit of tax savings under Section 80C and potential for high returns through equity exposure. With a 3-year lock-in period and tax deduction up to ₹1.5 lakh per year, ELSS SIP is one of the best tax-saving instruments.
Market corrections are the best time for SIP as you accumulate more units at lower prices. Stopping SIP defeats the purpose of rupee cost averaging.
Match fund category with your goals and time horizon. Equity funds for long-term (>5 years), debt funds for short-term (<3 years), hybrid for medium-term.
Your SIP should grow with your income. Increase SIP by 10-15% annually (step-up SIP) to reach goals faster and beat inflation.
Investing in 10 different large-cap funds doesn't mean diversification. Choose 3-4 funds across categories for proper diversification.
Review fund performance annually. If a fund consistently underperforms for 2-3 years, consider switching to a better fund.
SIP works best with specific goals and timelines. Define your goals (retirement, child's education) and invest accordingly.
SIP returns are market-linked and can be volatile in short-term. Focus on long-term wealth creation, not annual returns.
Power of compounding needs time to work. Ideally, stay invested for at least 5-10 years to see significant wealth creation.
Begin with ₹1,000-2,000 monthly even if you can afford more. Gradually increase amount as you gain confidence in markets.
Increase SIP amount by 10-15% every year or with salary hikes. This accelerates wealth creation significantly.
Create separate SIPs for different goals - retirement in equity funds, child's education in balanced funds.
Don't try to time the market. Stay invested through ups and downs for optimal returns.
Set SIP date 2-3 days after salary credit. Automate completely to ensure discipline.
Review portfolio once a year. Avoid frequent switching based on short-term performance.
Diversify across fund categories (large-cap, mid-cap, debt), not within same category.
If possible, increase SIP amount during market crashes to accumulate more units at lower prices.
Understand basics of mutual funds, read fund fact sheets, but don't get overwhelmed by daily market news.
Starting SIP at 25 vs 35 can make a difference of 50-100% in retirement corpus due to compounding.
SIP is an investment strategy, not a product. You can do SIP in mutual funds, ETFs, stocks, etc.
Returns shown in calculators are indicative. Actual returns depend on fund performance and market conditions.
There's no guarantee of returns in SIP. Past performance doesn't guarantee future results.
You can pause, stop, or modify SIP anytime without penalties. Complete flexibility is available.
Minimum SIP amount varies by fund - typically ₹500 to ₹1,000 per month.
SIP date can be any day of the month. Choose 2-3 days after your salary credit date.
Most mutual funds allow increasing SIP amount anytime. No need to start new SIP.
You can have multiple SIPs in same fund with different amounts and dates if needed.
ELSS funds have 3-year lock-in but offer tax benefits under 80C. Other funds have no lock-in.
Consider Systematic Withdrawal Plan (SWP) for regular income in retirement or for specific needs.
Disclaimer: This calculator provides estimated returns for educational and illustrative purposes only. Actual returns from SIP investments depend on market performance and can vary significantly. Past performance is not indicative of future results. Mutual fund investments are subject to market risks. Please read all scheme-related documents carefully before investing. Consult with a SEBI-registered investment advisor for personalized financial advice. The tax implications mentioned are as per current tax laws and are subject to change.