What Is a SIP Future Value Calculator?
A Systematic Investment Plan (SIP) lets you invest a fixed amount every month into a mutual fund or similar instrument. Because your money compounds over time and each instalment earns returns for the remaining tenure, the final maturity amount is much larger than the simple sum of your contributions. This calculator estimates that maturity value so you can plan toward financial goals like retirement, a home, or your child's education.
How to Use It
Enter three numbers: the monthly investment amount, the expected annual rate of return (a long-term equity fund estimate is often 10–14%), and the investment period in years. The calculator converts the annual rate to a monthly rate, applies it across all months, and shows your total future value along with the amount you invested and the estimated gains.
The Formula Explained
The future value uses the annuity-due formula: $$FV = P \times \frac{(1+i)^{n}-1}{i} \times (1+i)$$ Here \(P\) is the monthly contribution, \(i\) is the monthly rate (annual % ÷ 12 ÷ 100), and \(n\) is the number of months (years × 12). The trailing \((1+i)\) factor reflects that each instalment is invested at the start of the month and earns one extra period of growth.
Worked Example
Suppose you invest ₹5,000 per month for 10 years at 12% annual return. Then \(i = 0.12 / 12 = 0.01\) and \(n = 120\). $$FV = 5000 \times \frac{1.01^{120} - 1}{0.01} \times 1.01 \approx ₹11{,}61{,}695$$ You invested ₹6,00,000 and gained roughly ₹5,61,695 — illustrating the power of compounding.
FAQ
Are returns guaranteed? No. Market-linked SIP returns vary; this tool uses a constant assumed rate for estimation only.
Does it account for inflation or taxes? No, the result is a gross nominal value before inflation and taxes.
Why is maturity higher than what I put in? Each monthly instalment compounds for the rest of the tenure, so earlier contributions grow the most.
