How to Calculate SIP Returns: Formula, Example and Step-Up SIP

A SIP (Systematic Investment Plan) invests a fixed amount every month in a mutual fund. Because you invest regularly, your money compounds over time — which is why the starting date and the length of the SIP matter so much.

The SIP formula

• FV = P × [((1 + i)ⁿ − 1) ÷ i] × (1 + i)
• P = monthly investment, i = monthly return (annual ÷ 12 ÷ 100), n = number of months

Worked example

Investing ₹5,000 a month for 10 years at an assumed 12% annual return: you invest ₹6,00,000 and the estimated value is about ₹11.6 lakh. Stretch the same SIP to 15 years with ₹10,000 a month and the estimate rises to over ₹50 lakh on ₹18 lakh invested — compounding at work.

Why returns are only an estimate

Mutual fund returns are not fixed. The 12% above is an assumption for illustration; real returns vary every year and can be negative in the short term. Use the calculator to compare scenarios, not to predict results.

Boost your corpus

• Start early — time does more than the amount.
• Step up your SIP each year as your income grows.
• Stay invested through market ups and downs.

Think in real terms

Inflation reduces what a rupee buys in future. The calculator can show an inflation-adjusted value so you can judge whether your goal is realistic.