What is SIP and how is SIP return calculated?

SIP (Systematic Investment Plan) lets you invest a fixed amount monthly in mutual funds. Returns are calculated using the formula: FV = P × ((1+r)^n - 1) / r × (1+r), where P is monthly investment, r is monthly rate (annual rate ÷ 12 ÷ 100), and n is total months. The result shows how your regular investments compound over time.

What is a step-up SIP?

A step-up SIP (also called top-up SIP) increases your monthly investment by a fixed percentage each year. For example, a 10% step-up on ₹5,000 means you invest ₹5,000 in year 1, ₹5,500 in year 2, ₹6,050 in year 3, and so on. This accounts for income growth and significantly boosts long-term wealth.

What is the difference between SIP and Lumpsum investment?

In SIP you invest a fixed amount every month, averaging out market highs and lows (rupee cost averaging). In a lumpsum investment you invest the entire amount at once. SIP is suited for salaried investors building wealth gradually; lumpsum is ideal when you have a large sum ready to invest.

What is CAGR in mutual fund returns?

CAGR (Compound Annual Growth Rate) represents the steady yearly growth rate that would produce the same final value as your actual investment. For lumpsum it equals the annual return rate directly. For SIP it is calculated as ((FV / Total Invested)^(1/years) - 1) × 100.

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SIP Calculator India

Free to Use

Calculate mutual fund SIP returns, lumpsum growth, CAGR, inflation-adjusted real value, post-tax corpus and year-by-year wealth. Includes step-up SIP and goal planning.

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Quick Presets

Monthly Investment Amount (₹)

Expected Annual Return (%)

Investment Period10 years

1 yr30 yrs

Step-up SIP

Increase SIP annually to grow wealth faster

Inflation Rate (%)

Fund / Tax Type

₹6,00,000

Invested Amount

₹5,61,695

Total Returns

₹11,61,695

Total Value (Nominal)

Real: ₹6,48,685

Inflation-Adjusted Value (6% p.a.)

Nominal (Future ₹)

₹11,61,695

Real Value (Today's ₹)

₹6,48,685

Purchasing Power Lost

₹5,13,011

Post-Tax Corpus — LTCG @ 12.5% (₹1.25L exempt)

Gross Corpus

₹11,61,695

LTCG Tax

− ₹54,587

Net Post-Tax Corpus

₹11,07,108

* LTCG: ₹1.25L of gains exempt, remainder taxed at 12.5% (as per Finance Act 2024)

Wealth Gained

Your money grew 1.94x

CAGR on Invested

6.83%

Absolute Returns %

93.6%

Amount Invested₹6,00,000 (51.6%)

Total Returns (Gains)₹5,61,695 (48.4%)

SIP vs Lumpsum Comparison

Same total invested (₹6,00,000): SIP monthly vs all at start

Mode	Total Invested	Final Value	Difference
SIP (Monthly)	₹6,00,000	₹11,61,695	—
Lumpsum (At Start)	₹6,00,000	₹18,63,509	₹-7,01,814

Lumpsum wins here because compounding starts earlier on full corpus.

Year-by-Year Growth

Year	Invested	Returns	Total Value
Year 1	₹60,000	₹4,047	₹64,047
Year 2	₹1,20,000	₹16,216	₹1,36,216
Year 3	₹1,80,000	₹37,538	₹2,17,538
Year 4	₹2,40,000	₹69,174	₹3,09,174
Year 5	₹3,00,000	₹1,12,432	₹4,12,432

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