Plan for a Secure Future with the Help of an SIP Calculator

A Systematic Investment Plan or SIP is an investment method in which you invest a fixed corpus of money every month, quarter or year in a mutual fund scheme of your choice. Investing in an SIP is considered to be the best means for long term wealth creation as it lets you build a strong portfolio with relatively small investments at regular intervals; you can begin investing with an amount as low as Rs.500 per month. Investing at regular investments reduces the risk of market fluctuation, making SIP investment a smart and hassle free method of investing in mutual funds.

Now, if you are going to invest in SIPs, it is becomes imperative for you to know the returns that you could expect. This is where a SIP calculator comes in handy. As the name suggests, it helps you calculate the approximate return you would get on your investment after a specified tenure. Typically, all leading Asset Management Companies or AMCs have a SIP calculator on their website, as each of them have their own formula to determine the Return on Investment or ROI. It is recommended that you use the calculator present on your AMC’s website to ensure that you get the most consistent numbers.

An SIP calculator is really easy to use. Typically, you need to enter the following details:

  •   The amount you plan to invest regularly
  • The investment frequency i.e. monthly, quarterly or yearly
  • The investment tenure
  • The percentage return that you expect to get at the end of a year
  • The annual inflation rate

The calculator will then crunch the number and churn out the approximate amount that you will get at the end of your investment tenure.

Now that you know how easy it is to use a SIP calculator, go to your AMC’s website and use it to get a fair idea about your ROI. This will certainly help you make an informed investment decision.