# What will my SIP be worth?

Computes the maturity value of a monthly SIP (systematic investment plan) in rupees at an expected yearly return, with an optional yearly step-up.

- Page: https://www.acalculator.org/finance/sip-calculator
- JSON spec: https://www.acalculator.org/finance/sip-calculator.json
- Version: f6d17f65676f

## Default answer

Example with the default inputs (Monthly investment (₹) 10,000, Expected return a year 12%, For how long? (years) 10, Step up each year by 0%): Investing ₹10,000 a month at 12% for 10 years grows to ₹2,323,391, of which ₹1,123,391 is returns.

## Inputs

| Key | Label | Description |
| --- | --- | --- |
| amount | Monthly investment (₹) | The amount in rupees invested at the start of every month. |
| rate | Expected return a year | The expected yearly return. The monthly rate is this divided by 12. |
| years | For how long? (years) | How many years you invest every month. |
| stepup | Step up each year by | The percent the monthly investment goes up at the start of each new year (a step-up or top-up SIP). |

## Outputs

| Key | Label | Description |
| --- | --- | --- |
| value | Maturity value (₹) | The value at the end of the last month. |
| invested | Amount invested (₹) | Every monthly investment added up. |
| returns | Estimated returns (₹) | The maturity value minus the amount invested. |

## Method

FV = P × ((1 + i)^n − 1) ÷ i × (1 + i), with P the monthly investment, i the yearly return ÷ 12, and n the number of months; worked month by month, with a step-up raising P each year.

## Assumptions

- The return stays the same every month. Mutual fund returns go up and down.
- The monthly rate is the yearly return divided by 12, as most SIP calculators use.
- Each instalment is invested at the start of its month.
- Exit loads, expense ratios already in the return, and taxes are not included.
- This is an estimate for planning, not financial advice.

## Worked examples

1. amount = 1,000, rate = 8%, years = 25 gives value = 957,366.570525, invested = 300,000. Source: AMFI (amfiindia.com, SIP page): ₹1,000 a month at 8% for 25 years gives ₹9.57 lakh; full value from the formula in content.mdx.
2. amount = 5,000, rate = 12%, years = 10 gives value = 1,161,695.38176, invested = 600,000, returns = 561,695.38176. Source: hand calculation in content.mdx: 5,000 × (1.01^120 − 1) ÷ 0.01 × 1.01.
3. amount = 1,000, rate = 0%, years = 2, stepup = 10% gives value = 25,200, invested = 25,200, returns = 0. Source: hand calculation in content.mdx: 12 × 1,000 + 12 × 1,100.
4. amount = 1,000, rate = 12%, years = 2, stepup = 10% gives value = 28,524.132306, invested = 25,200. Source: hand calculation in content.mdx: year 1 grows 12 more months, year 2 is 1.1 times year 1.

## FAQ

### What is a SIP?

A SIP (systematic investment plan) is a way to invest a fixed amount in a mutual fund scheme at regular intervals, usually every month, instead of one lump sum. AMFI, the association of Indian mutual funds, describes it this way on its investor pages.

### How is the SIP maturity value calculated?

With a monthly instalment P, a monthly rate i (the yearly return ÷ 12), and n months: maturity value = P × ((1 + i)^n − 1) ÷ i × (1 + i). The last (1 + i) is there because each instalment is invested at the start of its month and earns that month’s return.

### What return should I expect from a SIP?

Nobody can promise one. Equity mutual fund returns rise and fall, and past returns do not guarantee future ones. The calculator uses one fixed rate for every month, so the answer is an estimate. Try a few rates to see a range.

### What is a step-up SIP?

A step-up (or top-up) SIP raises the monthly amount each year, often in line with a pay rise. With a 10% step-up, ₹10,000 a month in year 1 becomes ₹11,000 a month in year 2 and ₹12,100 in year 3. Enter the step-up under "Step-up SIP".

### Is the SIP return taxed?

Gains on mutual fund units are taxed as capital gains when you redeem them, at rates that depend on the type of fund and how long you held each instalment. The calculator shows returns before tax and before any exit load.

### What is rupee cost averaging?

Because a SIP invests the same amount every month, it buys more units when the price (NAV) is low and fewer when it is high. AMFI’s example: ₹1,000 buys 50 units at a NAV of ₹20, but 100 units at a NAV of ₹10. This calculator uses a steady return, so it does not show that effect.

## Sources

- Association of Mutual Funds in India (AMFI), Systematic Investment Plan (SIP): definition, rupee cost averaging, and the example of ₹1,000 a month at 8% for 25 years giving ₹9.57 lakh. https://www.amfiindia.com/investor/become-mf-distributor?zoneName=sip
- AMFI, Mutual Funds Sahi Hai: What is a systematic investment plan? https://www.mutualfundssahihai.com/en/what-systematic-investment-plan-sip
- Future value of an annuity due: S. A. Broverman, Mathematics of Investment and Credit, chapter 2.