Year by year
| Year | Monthly SIP | Invested that year | Total invested | Returns | Value |
|---|
What is a SIP?
A Systematic Investment Plan is a standing instruction to invest a fixed amount in a mutual fund every month. The amount is debited from your bank account automatically and used to buy units of the fund at that day's price. Over years, this does two useful things: it removes the question of when to invest, and it averages your buying price across good and bad months.
SIPs start as low as ₹500 a month with most fund houses. You can pause, increase, or stop at any time; there is no lock-in except in ELSS (tax-saving) funds, which lock each instalment for three years.
How the SIP calculator works
Each monthly instalment compounds separately for the months it stays invested. The standard formula, used by AMFI and every fund house, assumes the SIP is invested at the start of each month:
- P is the monthly SIP amount
- r is the monthly rate, which is the annual return divided by 12
- n is the number of months
With a step-up, the formula is applied year by year with the SIP increased once a year, which is what this page does. The expected return is an assumption, not a promise; mutual fund returns are market-linked.
Why a yearly step-up matters so much
Most people's income rises every year, but their SIP stays at whatever they set on day one. A step-up SIP increases the instalment by a fixed percentage annually. The effect on the final corpus is larger than it looks.
Take ₹10,000 a month at 12% for 20 years. Flat, it grows to roughly ₹1 crore. With a 10% yearly step-up, the same starting amount grows to about ₹2 crore, and you never feel the increase because it tracks your salary. Try it with the step-up slider above.
SIP vs lumpsum
If you already have a large amount, investing it at once usually beats spreading it over years, simply because the money is invested for longer. SIP wins in two situations: when you don't have the money yet (which is most people), and when you'd rather not bet everything on today's price. If you are investing from a monthly salary, SIP is the option that matches how the money arrives.
Why the after-inflation number matters
₹1 crore in 2046 will not buy what ₹1 crore buys today. At 6% inflation, prices roughly double every 12 years, so a corpus 20 years away is worth about a third of its face value in today's rupees. Turn on the inflation toggle to see your result in today's money. If you are planning for a specific goal, such as a child's education or retirement, this is the number to plan with.
How SIP returns are taxed
Each SIP instalment is treated as a separate purchase, so when you redeem, units are sold in the order they were bought. For equity funds, units held longer than 12 months are long-term capital gains and taxed at 12.5% on gains above ₹1.25 lakh in a financial year; units held under 12 months are taxed at 20%. Debt funds bought after April 2023 are taxed at your income-tax slab regardless of holding period. Rates change with each Budget, so check the current year's rules before redeeming.
Common questions
Is the SIP return shown here guaranteed?
No. The calculator shows what a fixed annual return would produce. Real funds return more in some years and less in others; the long-term average is what matters, and 12% is a reasonable planning assumption for equity funds, not a minimum.
What is a good SIP amount to start with?
Whatever you can keep up without touching it. ₹2,000 a month started at 25 and stepped up 10% a year outperforms ₹10,000 a month started at 35. Starting early matters more than starting big.
How much SIP do I need for ₹1 crore?
At 12% for 15 years, about ₹20,000 a month flat, or about ₹11,500 with a 10% yearly step-up. Switch to "How much should I invest?" above and set your own years and return.
Can I stop or change my SIP?
Yes, at any time, with no penalty. Open-ended funds have no lock-in. ELSS funds lock each instalment for three years from its own date.
What does XIRR mean on my statement?
XIRR is the actual annualised return on your SIP, accounting for the fact that each instalment was invested on a different date. It is the right number to compare with the "expected return" on this page.
Does this calculator include expense ratio?
Published fund returns are already net of expense ratio, so if you use a fund's historical return as your assumption, expenses are already accounted for.