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Finance
Project the maturity value of a monthly Systematic Investment Plan (SIP) in mutual funds, and see how compounding rewards starting early.
A SIP invests a fixed amount every month. Each contribution is assumed to land at the end of the month and, from the next month onward, earns the monthly-equivalent of your expected annual return — so the balance each month equals the prior balance plus a month of growth, plus that month's new contribution. Because every contribution keeps earning returns for the rest of the tenure, money invested in year one contributes far more to the final corpus than money invested in the last year, even though both installments are the same size. Assumptions: monthly compounding matched to the monthly contribution frequency, a constant assumed annual return held flat for the whole tenure (real mutual fund returns fluctuate — this rupee-cost-averages the ups and downs into one steady rate), and no fund expense ratio, exit load, or capital-gains tax deducted from the result.
A Systematic Investment Plan is a fixed amount invested in a mutual fund at a regular interval, typically monthly. It builds a savings habit and averages your purchase price across market ups and downs (rupee-cost averaging).
No. The annual return you enter is an assumption, not a promise — mutual fund returns are market-linked and vary year to year. This calculator smooths that variability into one constant rate to show the shape of long-term compounding, not a forecast.
No. The result excludes expense ratios, exit loads, and capital-gains tax on withdrawal. Your actual take-home maturity value will be somewhat lower than the figure shown here.