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Systematic Investment
Plan Calculator
What is SIP and SIP Calculator?
• SIP: SIP is an abbreviation of a Systematic Investment Plan. It is an
investment strategy to invest in a certain amount of money at regular
intervals of time in a mutual fund scheme. It is a fixed amount of
money is auto-debited from the bank account of the investors and is
assigned several units, as per the present Net Asset Value (NAV). SIP
investment plans are the smartest and most convenient way of
investing in mutual funds.
• SIP Calculator: As the name suggests SIP calculator helps to calculate
the wealth gain and the expected returns for the monthly SIP
investment. User can get a rough estimate on the maturity amount
for any monthly SIP Plan, based on the projected annual return rate.
Types of SIP
• Top-up SIP: In this type of SIPs the first installment is fixed, and the incremental amount
and frequency of the increment are pre-decided. This leads to an automatic increase in
the investment amount at regular intervals.
• Flexi SIP: Here, whether you have chosen the monthly or daily, to pay different SIP
amounts every time. This gives you, as the investor, a benefit of not being bound to pay a
certain amount every month or daily but decide according to the cash flow at the time of
SIP payment. Thus, in case you have a cash crunch you can skip the installment as per the
requirement. However, it is also recommended not to do so unless you understand the
market conditions and invest.
• Perpetual SIP: Under this type the paying SIPs without an end date. Not for a year, 3 or 5
years, but keep going till one wish. If you opt for this scheme, you have the option to
redeem the fund at a time of your convenience.
• Trigger SIP: This SIP is for the ones that understand markets well, then this type of SIP
gives you the option to use that knowledge. You can set a NAV or index level or event or
a particular date to start the payments for this type of SIP. Trigger SIP encourages
speculation and is therefore not preferred by many.
Features & Benefits of SIP
1. Rupee cost averaging: If you choose to invest in a fixed amount of money every month via SIP,
you will see that more stocks are purchased when the price of the investment falls. This
simultaneously brings down the average cost of buying a financial asset over time.
2. Convenience: Investing in SIP is a simple and hassle-free process. You can instruct the bank to
activate or facilitate you with the auto-debits from your bank account. As nowadays everyone
is online, you can also visit the website of the fund house of your choice and click on the link
for the SIP registration link or the tab.
3. Disciplined Saving: To achieve anything in this world discipline is meant as an essence. By
investing in SIP, you commit to saving regularly, and every investment takes you a step closer to
reaching the financial objectives.
4. Compounding: A small sum of money invested in SIP on a regular interval can grow into a
considerably the big amount. Through the power of compounding, the interest earns interest,
allowing you to fetch a substantial amount of earnings.
5. No need to time the market: It can be a big dilemma for many to knowing when the right time
is to invest in the market. As it is hard to predict that when the market will be at its peak or its
low point. While SIP is not free from the market volatility.
How to use SIP Calculator?
• SIP returns are calculated based on the compound interest. However,
the SIP calculator may vary in functioning as it depends on the site
you are using. Here are the generic steps of using a SIP calculator:
 Step 1: Enter the amount you want to invest.
 Step 2: Choose the number of years you are willing to continue the
investment.
• After providing this much information the SIP calculator will
automatically calculate the amount of return.
What is SIP Advanced Calculator?
• SIP Advanced Calculator is an upgraded version of the basic SIP
calculator.
• It would calculate the return of post inflation.
• This shows a better picture of the maturity value considering
inflation.
• Generally, it requires basic information like the monthly investment
amount, investment tenure in years, expected the rate of return and
the expected rate of inflation to arrive at the maturity value, pre and
post inflation.
Why Should you Invest In SIP?
1. Finance Future Goals: Futures goals like buying a house, child’s education, retirement plans,
etc can be achieved with the help of SIP. You can build a corpus over a period by investing a
monthly basis.
2. Diversification: Almost every market expert encourages investors to have a diverse portfolio. In
the same way, SIP can help you acquire the advantages of diversification even if you invest a
small amount. The risk is divided as you invest in different holdings. In this way, you can make
better gains.
3. Minimizes Risk Factor: When you invest in the Equity Mutual funds through the SIPs, the risk
factor minimizes and ride through the ups & downs of the equity market. This is because the
investment is small and is spread over a period. Due to this, market timing is not something to
be worried about.
4. No Pressure of Market Timings: If one invests in a lump sum of amount, it is important to time
it well. You can buy a large number of stocks but if you do not time the market well, then you
the chances of losses increase. Such worries can be reduced by investing with SIPs as the
amount invested is small.
5. Disciplined Investing: SIP investments help you to build up a habit of investing regularly. It
makes you more disciplined in terms of investing. When you start investing through SIP, a fixed
amount gets deducted from the bank account each month.
Is SIP Safer than Lump-sum Investment?
1. Rupee Cost Averaging: SIP allows for averaging an investment cost. The
fundamental mantra behind rupee cost averaging is to get more units for a
lower price. When markets fall, you get more units of the scheme. When
markets rise you get fewer units for the same amount. In this way, your average
cost per unit in the volatile markets turns out to be lower than when you invest
in a lump-sum.
2. Safer in volatile markets: With a SIP the risk from market volatilities is lower
because your investment is averaged out. Whether the markets are high or low,
your investments continue. Unlike a lump-sum investment, you don’t need to
time the markets.
3. Flexible Payments: You can customize the SIP investment based on the
financial situation or affordability. So, let’s say you start with a small SIP in line
with the income. As your income increases, you can choose to increase the SIP
contribution. This increases the chances of achieving personal financial goals
by accumulating greater wealth.
Thank You !!!

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SIP Calculator Guide: Everything You Need to Know About SIP and SIP Calculators

  • 2. What is SIP and SIP Calculator? • SIP: SIP is an abbreviation of a Systematic Investment Plan. It is an investment strategy to invest in a certain amount of money at regular intervals of time in a mutual fund scheme. It is a fixed amount of money is auto-debited from the bank account of the investors and is assigned several units, as per the present Net Asset Value (NAV). SIP investment plans are the smartest and most convenient way of investing in mutual funds. • SIP Calculator: As the name suggests SIP calculator helps to calculate the wealth gain and the expected returns for the monthly SIP investment. User can get a rough estimate on the maturity amount for any monthly SIP Plan, based on the projected annual return rate.
  • 3. Types of SIP • Top-up SIP: In this type of SIPs the first installment is fixed, and the incremental amount and frequency of the increment are pre-decided. This leads to an automatic increase in the investment amount at regular intervals. • Flexi SIP: Here, whether you have chosen the monthly or daily, to pay different SIP amounts every time. This gives you, as the investor, a benefit of not being bound to pay a certain amount every month or daily but decide according to the cash flow at the time of SIP payment. Thus, in case you have a cash crunch you can skip the installment as per the requirement. However, it is also recommended not to do so unless you understand the market conditions and invest. • Perpetual SIP: Under this type the paying SIPs without an end date. Not for a year, 3 or 5 years, but keep going till one wish. If you opt for this scheme, you have the option to redeem the fund at a time of your convenience. • Trigger SIP: This SIP is for the ones that understand markets well, then this type of SIP gives you the option to use that knowledge. You can set a NAV or index level or event or a particular date to start the payments for this type of SIP. Trigger SIP encourages speculation and is therefore not preferred by many.
  • 4. Features & Benefits of SIP 1. Rupee cost averaging: If you choose to invest in a fixed amount of money every month via SIP, you will see that more stocks are purchased when the price of the investment falls. This simultaneously brings down the average cost of buying a financial asset over time. 2. Convenience: Investing in SIP is a simple and hassle-free process. You can instruct the bank to activate or facilitate you with the auto-debits from your bank account. As nowadays everyone is online, you can also visit the website of the fund house of your choice and click on the link for the SIP registration link or the tab. 3. Disciplined Saving: To achieve anything in this world discipline is meant as an essence. By investing in SIP, you commit to saving regularly, and every investment takes you a step closer to reaching the financial objectives. 4. Compounding: A small sum of money invested in SIP on a regular interval can grow into a considerably the big amount. Through the power of compounding, the interest earns interest, allowing you to fetch a substantial amount of earnings. 5. No need to time the market: It can be a big dilemma for many to knowing when the right time is to invest in the market. As it is hard to predict that when the market will be at its peak or its low point. While SIP is not free from the market volatility.
  • 5. How to use SIP Calculator? • SIP returns are calculated based on the compound interest. However, the SIP calculator may vary in functioning as it depends on the site you are using. Here are the generic steps of using a SIP calculator:  Step 1: Enter the amount you want to invest.  Step 2: Choose the number of years you are willing to continue the investment. • After providing this much information the SIP calculator will automatically calculate the amount of return.
  • 6. What is SIP Advanced Calculator? • SIP Advanced Calculator is an upgraded version of the basic SIP calculator. • It would calculate the return of post inflation. • This shows a better picture of the maturity value considering inflation. • Generally, it requires basic information like the monthly investment amount, investment tenure in years, expected the rate of return and the expected rate of inflation to arrive at the maturity value, pre and post inflation.
  • 7. Why Should you Invest In SIP? 1. Finance Future Goals: Futures goals like buying a house, child’s education, retirement plans, etc can be achieved with the help of SIP. You can build a corpus over a period by investing a monthly basis. 2. Diversification: Almost every market expert encourages investors to have a diverse portfolio. In the same way, SIP can help you acquire the advantages of diversification even if you invest a small amount. The risk is divided as you invest in different holdings. In this way, you can make better gains. 3. Minimizes Risk Factor: When you invest in the Equity Mutual funds through the SIPs, the risk factor minimizes and ride through the ups & downs of the equity market. This is because the investment is small and is spread over a period. Due to this, market timing is not something to be worried about. 4. No Pressure of Market Timings: If one invests in a lump sum of amount, it is important to time it well. You can buy a large number of stocks but if you do not time the market well, then you the chances of losses increase. Such worries can be reduced by investing with SIPs as the amount invested is small. 5. Disciplined Investing: SIP investments help you to build up a habit of investing regularly. It makes you more disciplined in terms of investing. When you start investing through SIP, a fixed amount gets deducted from the bank account each month.
  • 8. Is SIP Safer than Lump-sum Investment? 1. Rupee Cost Averaging: SIP allows for averaging an investment cost. The fundamental mantra behind rupee cost averaging is to get more units for a lower price. When markets fall, you get more units of the scheme. When markets rise you get fewer units for the same amount. In this way, your average cost per unit in the volatile markets turns out to be lower than when you invest in a lump-sum. 2. Safer in volatile markets: With a SIP the risk from market volatilities is lower because your investment is averaged out. Whether the markets are high or low, your investments continue. Unlike a lump-sum investment, you don’t need to time the markets. 3. Flexible Payments: You can customize the SIP investment based on the financial situation or affordability. So, let’s say you start with a small SIP in line with the income. As your income increases, you can choose to increase the SIP contribution. This increases the chances of achieving personal financial goals by accumulating greater wealth.