What is an SIP calculator? Advantages of sip calculator

SIP calculators can be a handy tool in estimating the corpus. Find out why you should use them.

Want to know how much your SIP can offer

Investing in mutual funds through a Systematic Investment Plan (SIP) is quite beneficial. You don’t have to time the market; you can benefit from rupee cost averaging, and - above all - you can invest affordably. 

While SIPs help you create a corpus, knowledge of the amount involved is also crucial so you can plan your financial goals. But how to do this? The answer lies in SIP calculators.

What is an SIP calculator?

An SIP calculator is an online calculation tool that helps you find out the corpus that you can create through your SIP investments. An SIP calculator works using the following inputs:

  • SIP amount
  • Investment frequency
  • Investment tenure
  • Expected rate of return
  • Input these four factors, and you will get the estimated returns instantly!

Related: 7 Reasons Why Women Should Invest In A SIP

Advantages of an SIP calculator

There are many benefits of an SIP calculator, and here are the important ones:

  1. It’s accurate: You get an accurate estimate of the corpus as there is hardly any margin of error with SIP calculators. It helps you to extrapolate data for a longer tenure while keeping the base returns the same.
  2. It’s quick: SIP return calculators give instant results. You don’t have to wait to check the corpus calculation. Just hit ‘Calculate’, and you will get the answer in a split-second.
  3. It’s absolutely free: SIP calculators are completely free of cost. You don’t have to pay a single rupee, and you can use it an unlimited number of times. Also Read: SIP Vs Lumpsum: Which One Is Right For You To Invest In Mutual Fund?
  4. It helps in making investment decisions to achieve your financial goals: When you plan for your goals and invest in SIPs, you need to check how much investment would be needed for creating the desired corpus. This is where SIP calculators come in handy. By entering the SIP amount, tenure, and expected returns, you can get an idea of the corpus you can accumulate over a certain period of time. If the corpus seems inadequate, you can increase the SIP amount and/or the tenure. So, these calculators help you make informed investment decisions.
  5. It allows you to compare and select SIPs: By entering the past returns of different SIP schemes, you can check the corpus that each scheme would have created if you had invested in it. This corpus can then be compared across different schemes to find out which scheme performed the best. This way, you can choose a scheme that gives the best returns and maximise the profitability of your investment.

Related: Can You Beat The Slowdown With SIPs?

Last words

If you are starting an SIP, use an SIP calculator to make an informed investment. On the other hand, if you are already investing through SIPs, use it to review the sufficiency of your investment. Make the most of the calculator and be a smart investor!


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