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Invested Amount
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Estimated Returns
*These numbers are for illustration purpose only. Actual numbers may vary.

Potential investors might believe that SIPs (Systematic Investment Plans) and mutual funds are identical. However, SIPs are just one way to invest in mutual funds. The alternative is a lump sum investment. A SIP calculator is a tool that assists in estimating the returns you can expect when investing money through these options. A Systematic Investment Plan, or SIP, involves investing a fixed amount of money in mutual funds at regular intervals. 

What does a SIP Calculator do?

A SIP calculator is a straightforward tool that enables individuals to estimate the returns on their mutual fund investments made through SIP. SIP investments in mutual funds have recently gained significant popularity among millennials.

These calculators for mutual fund SIPs are designed to provide potential investors with a rough idea of their investments. However, the actual returns from a mutual fund scheme can differ based on several factors. It's important to note that the SIP calculator does not provide details on the exit load and expense ratio.

This tool is designed to calculate the increase in wealth and expected returns for your monthly SIP investment. It provides a general approximation of the maturity amount for any monthly SIP, considering a projected annual return rate.

How to Use BlinkX’s SIP Calculator?

You can use Blinkx's SIP amount calculator with a few clicks.

Simply input the monthly invested amount (the amount for which you initiated the SIP), the number of years you intend to keep invested, and the estimated rate of return.

As soon as you enter the figure, the calculator will provide the approximate amount you may withdraw after your investment period is completed. 

Advantages of Using BlinkX Systematic Investment Plan Calculator

According to various mutual fund experts, SIPs offer a more profitable approach to investing funds compared to a lump sum amount. It simply helps in financial discipline and cultivating a savings habit for future benefits. An online SIP calculator proves to be a valuable tool, offering an approximation of the returns you can expect at the end of your investment tenure.

Some benefits of SIP calculators Include: 

  • Helping you to decide the investment amount you wish to commit.
  • Providing information on the total invested amount.
  • Offering an estimate of the expected returns.

Types of SIP

Here are the types of Systematic Investment Plan

SIP Type

Main Feature

Suitability

Risk and Benefit

Equity SIPInvests primarily in stocks with the potential for higher returns but subject to market volatility.Investors with higher risk appetite, long-term investment horizon, and goal for wealth creation.Potential for capital appreciation and higher returns over the long term. Exposed to market risks and short-term fluctuations.
Debt SIPInvests in fixed-income instruments for stable income and lower volatility.Conservative investors seek regular income, capital preservation, lower risk, and a shorter investment horizon.stable returns, and acts as a hedge against market volatility. May offer relatively lower returns compared to equity SIPs.
Hybrid SIPInvests in a mix of equity and debt instruments.Investors seeking moderate risk exposure, regular income, and medium to long-term investment horizon.Offers diversification benefits, potential for capital appreciation and income generation, but also risks associated with market fluctuations.
ELSSTax-saving SIP investing mostly in equities.Investors looking to save taxes while aiming for long-term wealth creation with medium to long-term investment horizon.Provides tax benefits, the potential for higher returns and compounding, subject to market risks and short-term fluctuations.
Sectoral SIPFocuses on specific sectors for potential growth.Investors with high-risk appetite, specific sectoral insights, and long-term investment horizon.Offers the opportunity to capitalize on the growth of specific sectors but is exposed to concentrated risks associated with the chosen sector.
Index SIPReplicates specific market index for market returns and broad exposure.Investors seeking market returns, lower costs, and no active fund management requirements.Provides diversification, lower expense ratios, and benchmark-like returns, but is subject to market risks and cannot outperform a tracked index.
Gold SIPInvests in gold ETFs or mutual funds for portfolio diversification and hedging against inflation.Investors looking to diversify portfolios, hedge against inflation, and invest in gold as an asset class.A convenient and cost-effective way to invest in gold provides liquidity but is impacted by volatile gold prices in the short term.
International SIPInvests in foreign securities for exposure to global markets and growth opportunities.Investors seeking international diversification, exposure to global trends, and long-term growth.Provides access to international markets, sectors, and currencies, the potential for higher returns but is exposed to currency risk and global market volatility.

How do SIP Calculators Work?

The functionality of a SIP calculator is based on mathematical equations designed to incorporate the compound interest accumulated during SIP investments. The formula it uses is:

FV = P [ (1+i)^n-1 ] * (1+i)/i

This formula represents the following variables:

FVFuture Value
Represents the regular investment amount
iDenotes the rate of return
NStands for the number of installments

Consider a scenario where you intend to allocate Rs.10,000 every month for 7 years with an anticipated annual rate of return of 12%. 

In this case, the monthly rate of return can be calculated as 12% divided by 12%/ 12 = 0.1

Hence, FV = 10,000 ({[1 + 0.01] 84 - 1 } / 0.01) x (1 + 0.01)

Under these conditions, your accumulated fund would amount to Rs. 13.19 lakhs.

Mistakes to Avoid While Making a Systematic Investment Plan

Here are the common mistakes to avoid while making a SIP:

  • Neglecting financial goal planning: Without specific goals, it is difficult to identify the optimal investment amount, duration, and asset allocation for your SIP.
  • Investing without research: Impartial research might result in bad financial selections. A lack of investigation can lead to improper investing.
  • Timing the market: SIPs use rupee cost averaging to decrease the impact of market volatility. Short-term changes might make it difficult to time the market. Staying focused on the long term may be beneficial.
  • Unmonitored investments: An SIP is not the same as establishing an investment amount and then forgetting about it. Periodic evaluations of your investment will prevent it from going unmonitored and will help to improve your SIP.

Ignoring professional advice: It is critical to get professional assistance with your SIP. Financial advisors may give helpful insights and help you match your investments with your objectives. Their experience can help you enhance your results.

FAQs on the SIP Calculator

Yes, SIP calculators can help estimate the potential corpus for retirement.

No, it provides an estimate based on the entered annual return rate.

Yes, SIP calculators are useful for estimating the corpus needed to achieve specific financial goals.

The amount you can invest in an SIP varies based on the mutual fund scheme's minimum investment requirement, typically ranging from as low as ₹500 to ₹5000 or more per month.

Yes, you can modify your SIP amount by submitting a request to increase or decrease the monthly investment according to your financial goals.

Yes, you can renew a SIP by giving instructions to your mutual fund provider for continuation with the same investment plan after the current SIP period ends.


 

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