Learn/Calculators/Returns and compounding
SIP calculator: what a monthly SIP grows to.
Enter a monthly amount, a yearly return and a period. The calculator compounds every instalment and shows the value, the money you put in and the gain.
- Formula shown
- Free, nothing stored
- Share your result as a link
- Value
- Invested
- Dynamic Asset Allocator, model
01How it works
In plain words.
A SIP buys at a fixed amount every month. Each instalment then compounds for the months left. The first instalment compounds the longest, the last one barely at all. The calculator turns your yearly return into the equivalent monthly rate, adds up every instalment’s future value and adds the existing corpus compounded over the whole period.
The formula
i = (1 + r)^(1/12) - 1, the monthly rate from a yearly return rFV = SIP x ((1 + i)^n - 1) / i + Corpus x (1 + i)^nn = years x 12 instalments, each paid at the end of its month02Worked example
The default numbers, by hand.
Rs 10,000 a month for 15 years at 12% a year: i = 1.12^(1/12) - 1 = 0.949% a month, 180 instalments, ((1.00949)^180 - 1) / 0.00949 = 471.5, so the value is about Rs 47.1 lakh against Rs 18 lakh invested. Calculators that divide 12% by 12 (1% a month) and pay at the start of each month show about Rs 50.5 lakh for the same inputs; that is a convention, not a different market.
| Input | Value |
|---|---|
| Monthly SIP | ₹10,000 |
| Existing corpus | ₹0 |
| Expected return a year | 12% |
| Period | 15 years |
| Result | Value |
|---|---|
| Value after 15 years | ₹47.1 L |
| Total invested | ₹18.0 L |
| Gain | ₹29.1 L |
| Gain as a share of the value | 61.8% |
| The same SIP at the Dynamic Asset Allocator model CAGR | ₹8.47 Cr |
03Key concepts
What to know before you use it.
What a SIP is
A Systematic Investment Plan invests a fixed amount at a fixed interval, usually monthly, into a fund or a basket of stocks. Because the amount is fixed, it buys more units when prices are low and fewer when they are high. This is called rupee cost averaging: the average cost per unit ends up below the average price over the period.
Why the convention matters
Two calculators can show different answers for the same inputs. This one converts the yearly return to a compound monthly rate and pays each instalment at month end. Others use the yearly rate divided by 12, or pay at the start of the month. Check which convention a figure uses before you compare it with another.
Good to know
- Time does most of the work: the last five years of a 20 year SIP add more rupees than the first ten.
- A constant return is a simplification. Real markets move around, so the actual value on any date can be above or below this line.
- The step up SIP calculator shows what raising the instalment each year does.
04Assumptions
What the calculator assumes.
- One constant return every year; real returns vary from year to year.
- Instalments at the end of each month; no missed instalments.
- No tax, exit load or expense ratio deducted; use the expense ratio and capital gains calculators for those.
05Questions
Asked about the SIP calculator.
How is SIP return calculated?
The yearly return is turned into a monthly rate, (1 + r)^(1/12) - 1, and every instalment is compounded at that rate for the months left. The values are added up. The formula is FV = SIP x ((1 + i)^n - 1) / i.
Why does another SIP calculator show a higher value?
Many calculators divide the yearly rate by 12 and assume the instalment is paid at the start of the month. Both choices raise the result. For Rs 10,000 a month at 12% for 15 years the difference is about Rs 3.4 lakh.
What return should I enter?
Any return you want to test. The reference chips show the Nifty 50 TRI figure with its date, a fixed deposit assumption and the model, back tested figures of RupeeCase indices. Past or back tested returns are not a promise of future returns.
Community
Join my WhatsApp group.
Scan the code, fillFill one short form, and join my WhatsApp group. Slides, sources, factsheets and the rebalance logs live there, and members join a daily Google Meet with me.
06Keep going
Learn the idea, see it applied.
More returns and compounding calculators
Education only, not investment advice. RupeeCase is a technology platform operated by QC Alpha Technologies Pvt Ltd; it is not a fund, a PMS or a SEBI registered investment adviser. Model returns are back tested and not a promise of future returns. Figures carry the date they were checked.