SIP CALCULATOR
SIP
Total Investment
Rs. 0
Estimated Return
Rs. 0
Estimated Total Return
Rs. 0
What is the Systematic Investment Plan (SIP)?
A Systematic Investment Plan (SIP) is a structured way to invest that enables individuals to put in a set amount of money at regular intervals, usually into mutual funds or similar investment options. This method takes advantage of compounding and rupee cost averaging, allowing investors to build wealth over time by consistently investing smaller amounts instead of making large one-time investments. SIPs are easy to access, dependable, and promote the habit of regular saving, making them perfect for achieving long-term financial objectives while effectively managing market risks.
What is the Systematic Investment Plan (SIP) Calculator?
The SIP Calculator helps estimate returns from Systematic Investment Plans based on monthly contributions, expected returns, and investment period. It provides insights into potential growth over time for investors.
How does SIP Calculator work?
Future Value = P × {(1 + r)n - 1} / r × (1 + r)
Where:
- P is the monthly investment amount
- r is the monthly interest rate
- n is the total number of installments
Let's break this down with a simple, real-life example:
Imagine you invest NPR 5,000 every month into a SIP for a duration of 10 years. The expected annual return rate is 12%, which translates to a monthly interest rate of 1% (0.12/12). Using the SIP formula:
Future Value = 5,000 × {(1 + 0.01)120 - 1} / 0.01 × (1 + 0.01)
After calculating, the maturity value of your SIP investment would be approximately NPR 11,61,695.
This means that by investing NPR 5,000 monthly for 10 years, your total investment of NPR 6,00,000 grows to NPR 11,61,695, thanks to the power of compounding.
SIP calculators are essential tools for planning your investments effectively and making informed financial decisions.
How to Use the SIP Calculator
- Enter the monthly investment amount.
- Specify the expected return rate and investment period.
- Click "Calculate" to view estimated returns and total investment.