What is SIP calculator and How It assists in investment planning?

A SIP (Systematic investment plan) calculator is a financial calculator that assists you in estimating the future value of your routine mutual funds investments. It computes returns through formula of compound interest: FV = P × [(1+r)ⁿ-1]/r × (1+r), P is monthly investment, r is monthly return, and n is months. Our calculator displays projected corpus, amount invested, projected gains, tax situation and projection per year. It assists in comparing the various investment situations, comprehending the effect of step-up SIP, inflation adjustment, and expense ratio, which allow one to better plan their finances towards any cause such as retirement, children education, or wealth creation.

What is the accuracy and returns of the SIP calculator?

Our SIP calculator works with industry standard formulae of compound interest and is 100% precise with the inputs that are entered. Projected returns are however estimates which are based on anticipated rates of returns. Equity mutual funds with 10-15 years display historical performance of 12-15% CAGR, large cap funds: 10-12, mid and small cap funds: 13-15 and 15-18 respectively, debt funds: 6-8 and index funds: 11-13. Real returns are different, depending on the market environment, fund returns and the economic forces. Be realistic in planning with use of conservative estimates of returns (10-12% of equity). Our Monte Carlo option gives best, worst and expected performance based on the volatile nature of the market and not a single figure as the expected.

What is step-up SIP and how many extra returns it can produce?

Step-up SIP (also known as top-up SIP) enables you to make increases to your SIP every so often (usually once in a year) by a predetermined percentage, which corresponds to the predetermined salary rise. EXample impact: 12 months of 10000 SIP at 12 percentage = 99.9 lakhs. Correspondingly, with step-up of 10 percent per year = 2.29 crores (130 percent more corpus). At 5% yearly step-up, final corpus can be raised by 50-60%. The step up SIP works very well since more investments made in the later years will enjoy massive compounding time. Majority of investors add 10-15 percent to SIP in a year. Our calculator allows you to model various step up percentages (0-30) to select the best strategy to use based on your income growth projections.

Is it SIP or lump sum investment that I should invest in?

They both have their own merits: SIP is superior to regular investors who receive an income each month, helps in lowering the risk in the market that is caused by the timing factor as it averages the cost of rupee, has less risk because the entry is staggered and with all the market conditions, SIP is more suitable to a beginner investor and this makes the investment more disciplined. Lump sum is superior in market crashes/corrections (10-15% down) when you have some major windfall (bonus, inheritance), the potential higher returns are high when market timing is good, and when you are an experienced investor able to make an evaluation of the markets. Most appropriate strategy: Stick to regular SIP investment (primary strategy), and use lump sum investment during significant market crashes (opportunistic). The calculator allows you to model either individually or together to determine the best allocation. Research indicates that SIP is winning in volatile markets, lump sums in constantly increasing markets.

What impacts my SIP returns because of inflation and why will I care?

Purchasing power of money is lost in inflation. Example: 1 crore present will only be able to purchase 54 lakhs in 10 years at a 6% inflation rate. Assuming that your SIP projected 50 lakhs in 15 years, at a 6 percent inflation it would be worth in real value in 15 years = 20.88 lakhs in current money. This is the reason why inflation must be considered during realistic goal planning. Real return = Nominal return- Inflation rate. E.g. fund yields 12 percent and inflation is 6 percent, the real yield will be approximately 6. Our calculator has the inflation adjustment option which displays both the nominal and the real (inflation adjusted) final values. Always strategize on goals with real returns. Equity returns (12-15 percent) is by far more effective than the inflation (6-7 percent) hence SIP is an effective investment to preserve and grow wealth over the long-term.

What is the lowest amount of SIP and period to invest to earn good returns?

Minimum SIP: Most mutual funds have SIP that can be ₹500 /month, but 1,000-2,000/month is more widespread and realistic. Greater values ( 5,000-10,000+) indicate significant wealth creation. Minimum: In the case of equity funds, the minimum recommended time is 5 years, but 7-10+ years during the ride of market cycles is ideal. For debt funds: 3-5 years. In the case of ELSS: 3 years lock-in (minimal), 5-7 years improved. Recommended times by objective: Retirement planning: 15-25 years, Children education: 10-18 years, Home down payment: 7-10 years and Wealth creation: 10-15 years. The most important rule is the longer the period the greater the compounding benefits. i.e. 5000/month x 25 years at 12 percent = 942 lakhs (invested 15L) but same at 15 years = 25 lakhs (invested 9L).

In India, How would SIP returns be taxed in 2024-2026?

SIP tax is based on the type of fund and period of holding. Equity Funds (>65% equity): Long-term (>1 year): 1 lakh gains at the beginning of the year exempt, above it 10% of LTCG tax. Short-term ( 3 years): Gains charged to your income tax slab rate. Short-term (Less than 3 years): Slab rate is charged. ELSS: The maximum amount of 80C deduction of up to 1.5 lakh (savings of up to 46,800 tax in 30 per cent bracket), however, post-redemption gains on the equity fund will be taxed as per the equity fund regulation (10 per cent LTCG above 1L). No TDS on mutual fund returns. Tax on the redemption date, rather than in holding. To be tax efficient: Keep equity funds longer than 1 year, redeem in tranches to keep below 1L LTCG cap in one year, Growth rather than Dividend option, ELSS to get 80C benefits. We have calculated post tax returns including LTCG.

What does Monte Carlo simulation mean in SIP calculator and should I be using it?

Monte Carlo simulation will run the computer simulation using thousands of scenarios with different returns (taking into account market volatility) to display the range of possible results rather than only one estimate. It takes into account: Historical volatility of markets (low: 10%, medium: 15%, high: 22%), market conditions (bull, bear, neutral) and arbitrary year-to-year returns changes. Outputs reflect: Worst-case scenario (10 th percentile) Expected outcome (50 th percentile - median), Best-case scenario (90 th percentile). Monte Carlo is used when: The goal is a critical goal (retirement, education) whose uncertainty is important, the risk tolerance is to be tested, there is a comparison between strategies of investment, the downside risk is to be known. The holdings of 15 years with 12% expected return and medium volatility at a total of 10K per month will give the following: Worst: 38 lakhs, Expected: 50 lakhs, Best: 65 lakhs. This assists in maintaining and establishing realistic expectations and contingency planning. Customize it on in Pro Options to do complex risk-aware planning.

SIP Calculator 2026 - GearsKit Mutual Fund SIP Return Calculator

Parameters

Tip: press R to reset. Change your investment parameters

Mode

Monthly Investment

₹10,000

₹500 ₹2,00,000

Lumpsum

₹2,00,000

₹0 ₹1,00,00,000

Time Period

10 Years

1Y40Y

Expected Return

12.00%

4%24%

Pro Options

Fees, inflation, step-up and projections

Monte-Carlo

OFF

Projection

Graph: Growth

Year-wise Projection

Year	Invested	Value	Gain

Saved Scenarios

Test several combinations in a short period of time

Summary

Inflation corrected and fee conscious

SIP

Projected value in 10 years

₹0

Real Return (after inflation)

—

Wealth Multiplier

—

Range View

OFF

Switch on Pro + Monte-Carlo with a broader band (best/ worst results). Enabling Pro + Monte-Carlo range

Worst

—

Expected

—

Best

—

Contributions What you put in

Total invested ₹0

Growth Before adjustments

Corpus (no fee / no inflation) ₹0

Estimated gains ₹0

Adjustments Pro options effect

Fee impact (approx) ₹0

Inflation impact (when ON) ₹0

Ultimate corpus (having made changes) ₹0

Tax Impact (LTCG) 10% above ₹1L

Taxable gains ₹0

LTCG Tax (10%) ₹0

Post-tax returns ₹0

What is SIP (Systematic Investment Plan)?

A Systematic Investment Plan (SIP) is a systematic way of investing a given amount of money on a regular basis (monthly, quarterly, or weekly) in mutual funds. One of the widely used investment practices in India is SIP, and this allows an investor to accumulate wealth in a systematic and organized way using the power of compounding and rupee cost averaging.

SIP also helps to limit the effects of market volatility depending on the fact that unlike lump sum investments where you invest a large sum of money at a time, SIP is spread over time, thus limiting the effects of market volatility. When the markets are high you will purchase less and when the markets are low you will purchase more. This cost averaging of rupees is useful in reducing the average cost per unit in the long run.

SIP investments are ideal in long-term wealth building (5+ years), retirement, children education, and attainment of significant financial objectives. Under the disciplined SIP investment, the smallest monthly investment in the market can turn into a huge wealth using the miracle of compounding returns. Our state of the art SIP calculator enables you to visualize your possible returns, scenario compare and plan your investment journey well.

SIP Calculation Formula: In depth explanation

Future value of SIP investments is determined using the formula of compound interest in case of regular deposit:

FV = P × [(1 + r)ⁿ - 1] / r × (1 + r)

FV:

Future value of investment

Monthly SIP amount

Monthly return on investments (Annual % ÷ 12 ÷ 100)

Total number of months (Years × 12)

Practical Example:

Find returns on 12% annual return on monthly SIP of 12s. ₹10,000:

Monthly SIP (P): ₹10,000
Expected Return: 12% per annum (Monthly: 12/12/100 = 0.01)
Investment Period: 15 years (180 months)
Total Invested: ₹18,00,000
Expected Value: ₹49,95,740
Estimated Gains: ₹31,95,740 (177% returns)

The advantages of SIP over Conventional Savings

Power of Compounding

Earn returns on your returns. Compounding may increase your wealth up to 5-10 times in 15-20 years. Compounding benefits should be maximized by starting early.

• At a 12 percent growth rate, 5000 per month will increase 1 crore in 20 years
• Growth in returns is not linear, but exponential
• Your capital doubles after every 6 years at 12 percent

Rupee Cost Averaging

Buy in more when markets are going down and less when markets are going up automatically. Lowers the average cost of purchase and investment risk.

• Eliminates the necessity to time the market
• Reduced risk, as compared to lump sum investing
• Cushions market volatility effect

Disciplined Investing

Auto-debiting of bank account will provide continuity in investing. Develops saving culture and avoids investment decisions based on emotions.

• Start with as low as ₹500/month
• Is able to increase SIP at any time (step-up SIP)
• Stop or interrupt without punishment

Beats Inflation

Historically, Equity SIPs earn 12-15% returns, which is much higher than inflation (6-7%). Secures and develops buying power in the long run.

• Fixed deposits promise 6-7% (barely out of inflation)
• Equity mutual funds: 12-15 Year CAGR 12-15%
• The real wealth creation occurs at above inflation

Flexibility & Liquidity

Get your money whenever you need it (2-3 days). No lock-in for regular SIPs. Grow, decline, rest or cease depending on the requirements.

• Redeem, in part or wholly, without penalties
• Switch between funds easily
• No modification paperwork

Tax Efficiency

There is tax deduction in ELSS SIPs under Section 80C (up to 1.5L). Any gains made on long term capital over 1L are taxed at 10% (equity funds).

• ELSS saves up to 46800 tax per year
• Minimum time to lock-in with tax-saving options (3 years)
• Possibility of greatest returns in 80C options

Types of SIP Investments

Regular SIP

Constant sum invested on a regular basis (monthly/quarterly). Majority and simplest type of SIP. Best in starting and long-term wealth generation.

Top-up / Step-up SIP

Automatically deposits SIP by a set percentage each year (3.e.g. 10%). Compliments the salary increases and helps to create wealth much faster.

Flexible SIP

Adjust the amount of investments made monthly depending on the cash flow. Rise in the excess months, fall during constrained months. Offers maximum flexibility.

Perpetual SIP

There is no specified end date - it runs continuously till you put a stop to it. Most suitable in the case of either retirement or children future planning when time horizon is very long.

Trigger SIP

Invests automatically against a particular event or level of NAV. Innovative planning of the seasoned investors to seize the market opportunity.

SIP with Insurance

Life insurance with SIP investment. In case investor dies, family gets sum assured and SIP is continued. Added coverage on dependents.

Best Mutual Fund Categories SIP best in 2026

Large Cap Funds (Most Stable)

Invest in 100 best companies in terms of market cap. Less risk, stable returns of 10-12% CAGR. Perfect to the conservative investors and first-time investors in regards to SIP.

Examples HDFC Top 100, ICICI Prudential Bluechip, Mirae Asset Large Cap.

Multi Cap (Balanced) Flexi Cap

Invest in all capital markets - big, medium, small. Sound balance of growth and stability. Historical returns: 12-15% CAGR. Appropriate in medium risk appetite.

Examples: Parag Parikh Flexi Cap, Axis Flexi Cap, Canara Robeco Flexi Cap

Mid Cap and Small Cap Funds (High Growth)

Increased risk and possibly the greatest returns (15-18 CAGR). Risky in short term, but superior in 7 or more year horizon. Available only to aggressive investors.

Examples Axis Midcap Fund, DSP Midcap fund, Nippon India Small Cap

Index Funds (Low Cost, Passive)

Follow Track Nifty 50 or Sensex indexes. Lowest expense ratio (0.1-0.3%). Performance is equal to that of the market (11-13% CAGR). Perfect to those who are new and desire market returns.

Examples: HDFC Index Nifty 50, ICICI Pru Nifty Index, UTI Nifty Index

ELSS Funds (Tax Saving)

ELSS in 3 years in form of a lock in. Tax deduction of 3 years of 1.5L under section 80C. Possible high 12-15% tax-deferred returns.

Examples Axis Long Term Equity, Mirae Asset Tax Saver, Parag Parikh ELSS

International / Global Funds

Diversify in the US/global markets. Currency advantage in case of the rupee devaluation. Gates to tech powerhouses such as Apple, Google, Microsoft.

Examples: Nasdaq 100 Flexi Cap at Motilal Oswal, PPFAS Flexi Cap, Edelweiss US Tech

Intelligent SIP Investment Plans to give maximum returns

Start Early, Stay Long

The difference between 25 and 35 can be a 2-3 times higher wealth at 60. As much as 25 years at 12% = even 2000/month = 3.5 crores. The most important asset in SIP is time.

Use Step-up SIP

Grow SIP by 10 per cent per year with pay increments. 5000/month with 10 per cent step-up over 20 years = 21 crore compared to 50 lakh without step-up (12 per cent return).

Diversify by Categories

SIPs ratio: 40 large cap, 30 flexi cap, 20 mid/small cap, 10 index funds. Minimizes the risk and retains growth opportunities between the market cycles.

Never Pull out in falling markets

Buying opportunities are market crashes. Keep SIPs (or invest more) when the market is down in order to purchase more at a lower price. Major corrections are followed by best returns.

Review Portfolio Annually

Annual check fund performance. Replace underperformers (under category average performance over 3 years or more). Churn not frequently - stay 5+ years not less.

Do Not Direct Plans to Amateurs

Direct plans are 0.5-1% less expensive with no advisor services. Begin with ordinary plans before you get acquainted with markets. Switch to direct after 2-3 years.

The SIP Investment Mistakes to Avoid

Cessation of SIP in Market Crash

Biggest mistake! Market declines are the best opportunities to keep/increase SIP. You buy more units cheap. Those who paused in 2008/2020 crashed were deprived of huge returns in recovery.

Very Short-term investment

SIP works best for 5+ years. A short term (1-2 years) exposes you to volatility of the market. In case of short-term goals in the range of 3 years, go with debt funds or FDs.

Selecting NFOs (New Fund Offers) Only

NFOs with 10 NAV are considered cheap but returns are not about NAV but returns. Select funds that have 5+ year track record. History of performance is useful to determine the capability of fund managers.

Over-Diversification

Investment in 15-20 funds will dilute returns and provoke uncontrollability. Only stick with 4-6 well-diversified funds. Quality over quantity.

Failure to associate SIP with Financial Goals

Not knowing what to achieve with SIP (retire, house, child education) results in premature withdrawal. Set objectives, compute the necessary corpus and initiate purposeful SIPs.

Ignoring Tax Implications

Equity funds: LTCG greater than 1L is taxed at 10 per cent, STCG (less than 1 year) is taxed at 15 per cent. The debt funds: are taxed in accordance with the income slab. Optimize post tax returns by tax efficient redemption of plans.

SIP or Lump Sum, Which is the best?

Parameter	SIP (Systematic Investment)	Lump Sum (One-time Investment)
Investment Amount	Small regular amounts (₹500 - ₹50,000/month)	Large one-time amount (₹1L - ₹50L+)
Risk Level	Lower (rupee cost averaging lowers volatility)	Increased (exposure to a full market at a single price)
Returns Potential	Moderate (average price of entry)	The more so when market timing is correct
Market Timing Need	No need - invest anytime	Critical - optimum when market is low
Best For	Salaried people, novices, ordinary savers	Seasoned investors, lows in the market, windfalls
Discipline Required	The discipline is guaranteed by auto-debit	High - need emotional control
Recommended Strategy	Most investors use primary strategy ✓	Use when there is significant market correction only

💡 Expert Recommendation:

Hybrid Approach Works Best: Resume usual SIPs in disciplined investing. In case of windfall (bonus, inheritance, sale proceeds) apply lump sum in case of market corrections (10-15% down of high). This will combine the advantages of the two approaches - SIP offers stability, lump sum offers the opportunity to gain.

Introduction to Your First SIP in 2026

Complete Your KYC

Single KYC procedure: Aadhaar card, PAN card, bank account documents, passport-size photograph. Can be done online in 15 minutes. Applicable to any mutual fund investment.

Choose Investment Platform

Alternatives: Through AMC site, distributor/broker, or apps ( Groww, Zerodha Coin, ETMoney, Paytm Money). But the simplest to use are the apps that have low/no fees and are simple to use by beginners.

Popular applications Groww, Zerodha Coin (free), Paytm Money, Kuvera, ET Money

Select Mutual Funds

Criteria used in making the research: Fund category (large/mid/small cap), previous 5-7 years performance, expense ratio (less than 1.5 percent), fund manager track record, AUM (amount under management).

Begin with 2-3 funds: 1 large cap and 1 flexi cap and 1 index fund

Set SIP Amount & Date

Select monthly installment (at least 500). Automatic debit: set SIP date based on salary credit date (1 st /5 th /10 th month). Enable auto-pay mandate.

Monitor & Review Quarterly

Quarterly check portfolio not responsive to short-term volatility. Evaluate on an annual basis - weed out regular non-performers. Investment period 5 years minimum.

SIP Investment Tax Advantages and Tax Implication

Tax Benefits

ELSS SIP - Section 80C

Invest 1.5L in ELSS funds per annum. Tax deduction saves as much as 46800 (30% tax bracket). PF 5 years vs 3 years lock in only.

Long-term Capital Gains (LTCG)

Hold equity funds of more than 1 year: Tax due on 1 lakh gains 1st 1 lakh, rest 10%. Better than that of FD with slab rate interest.

No TDS on Returns

Mutual funds do not deduct tax at source like bank FD. Only when you redeem with gains pay the tax.

Tax Liability

Short-term Capital Gains (STCG)

Equity funds sold which are less than 1yr: 15 tax on gains. Debt funds less than 3 years: taxed at income slab rate. Do not make short-term redemptions.

Dividend Distribution Tax

The mutual fund dividends were added to income and taxed at slab rate. Growth option is more tax effective as compared to dividend option.

Capital Gains Statement

Keep a diary of every SIP investment and redemption. AMC offers capital gain statement in filing of ITR. Report correctly to escape notices.

💡 Tax-Saving Tip: In the case of ELSS, commence 12 monthly SIPs as opposed to lump sum. Both SIPs have independent 3-year lock-in, which gives the flexibility of liquidity. In equity funds, it is always best to invest in a growth option, as opposed to the dividend option, which is more tax efficient.

Begin Your Award-Winning Wealth Creation Process

Their returns on SIP are calculated in a few seconds using our sophisticated calculator. Grow your investments in charts, compare two or more scenarios and plan financial freedom. Create wealth with millions of clever investors with SIP.

Get Investment Guidance

12-15%

Avg. Returns

100K+

Happy Users

₹500

Min. SIP Amount

SIP Calculator 2026 — Free Online SIP calculator Fund MF SIP returns