Simple Systematic Investment Plan (SIP) Calculator
A simple Systematic Investment Plan is the best way to avoid the shocks of stock market investing. You also reap the benefits of high returns. SIPs work best with equity mutual funds. SIP is the right option for a good future for yourself and your children.
SIP is perfect for those with long-term goals like education, marriage, or retirement. SIP works on a predecided sum. Here, the investor uses an SIP calculator to know the amount of money to be saved to build up the required corpus.
Let’s look at the SIPs and mutual fund SIP calculator in detail to understand how it calculates your savings for the future.
What is an SIP?
A Systematic Investment Plan (SIP) is an investment. It enables you to make periodic fixed investments in a mutual fund scheme. SIP investments can be made on a weekly, monthly, quarterly, or annual basis. Indian investors are increasingly choosing the disciplined investment option. This is because it offers the advantage of rupee cost averaging. This equalizes changes in net asset value (NAV). It means that your fear of losing money due to market volatility is reduced.
What is an SIP Calculator?
A growing SIP calculator is a financial instrument. This enables you to compute the returns on your mutual fund investments made through SIPs. It provides an estimate of the expected returns. But mutual funds’ actual results vary depending on variables.
The returns estimated by the SIP calculator online are also illustrative. They also depend on the expected annual return rate and the past performance of an SIP mutual fund.
So, you must take care here while determining the predicted rate.
When choosing this predicted rate, make sure to consider the following:
- If you have decided on the category of a mutual fund in which you would like to invest, then you can take the category return for some time.
- If there is one particular scheme that you are interested in and want to assess, then you can choose the SIP return of that plan.
- Whatever rate you get through the SIP Calculator Online should match your financial goals with the investment goal of the mutual fund scheme.
- Always remember that the returns of a SIP in a mutual fund are never guaranteed, unlike a fixed deposit. This is because mutual funds are linked to the market. This in turn affects the projected returns.
How Does an SIP Calculator Work?
A growing SIP calculator is a tool that aids in determining the final value of a series of payments over a given length of time with an expected growth rate.
SIP calculators online are widely available. Many of them may be found on the websites of mutual funds. Here is how an SIP calculator works to provide you with the amount that you need to pay frequently over a period of time.
- There are three elements that you must know and that are used to operate a growing SIP calculator. These elements include the number of regular investments, time, and expected rate of growth.
- You can find an option for quarterly payments in some SIP calculators online.
- Some of the growing SIP calculators also do offer the option of knowing the SIP amount. It is important to save a specific amount in addition to calculating the final sum. You can find out how much money you need to save by using the SIP calculator online.
- There is an option for a step-up in monthly savings in many SIP calculators online.
- You may also have the option to adjust the corpus for inflation in some growing SIP calculators. Here, you can know the worth of the final amount by entering an expected inflation rate since inflation reduces the purchasing power of the rupee.
Benefits of an SIP Calculator
The mutual fund SIP calculator is a useful and fascinating investment tool. It can be beneficial to you as an amateur investor in the following ways:
- Time-saving tool:
The growing SIP calculator is useful and simple to use. You can save time by not having to learn and perform difficult calculations by yourselves and instead getting the desired amount immediately.
- Establishes the required amount:
The SIP calculator online knows the target amount based on your SIP investments, frequency, return percentage, and duration.
- Goal planning:
The Growing SIP calculator is a fascinating tool to plan your life goals. The SIP calculator online can inform you of the monthly SIP that you need to make to achieve your goals. If you plan to buy a Macbook, you need to calculate the amount you need to put aside to buy it in, say, 2 years or so.
Who Uses an SIP Calculator?
It can be used by anyone who wants to invest in mutual funds through SIP to have an estimate of the future value of their SIP investments. You can use the calculator to check the future worth of your current investments in mutual funds.
Conclusion
We hope you have understood that the SIP calculator applies the power of the compounding concept to determine the future value of your SIP investments. The most important thing to know here is that the more time you devote to the growth of your money in SIPs, the longer you benefit. The growing SIP calculator knows the amount you will get from your SIP investments using the data you provide to the mutual fund SIP calculator.
When you know how much you can save with your current SIPs, you can decide whether you need to do more saving. This is especially true for needs such as retirement savings, education, or real estate. If you still are not sure whether you need to apply for SIPs or not, then contact Piramal Finance, where you can get more detailed and insightful information.