How do I calculate SIP returns?
- 1Choose SIP (a monthly investment) or lump sum (one investment today).
- 2Enter the amount, and for a SIP an optional yearly step-up.
- 3Enter the expected yearly return and the number of years.
- 4Read the maturity value, the total you invest and the estimated returns, with a table for every year.
What is the SIP formula?
- 01SIP: FV = P × [((1 + i)ⁿ − 1) ÷ i] × (1 + i)
- 02P = monthly SIP · i = yearly return ÷ 12 ÷ 100 · n = years × 12
- 03Step-up SIP: the instalment rises by the step-up % every 12 months; each one grows for the months left
- 04Lump sum: FV = L × (1 + R)ᵗ, R = yearly return ÷ 100, t = years
- 05Estimated returns = maturity value − amount invested
A SIP invests a fixed amount every month. Each instalment grows for the months left until the end, so the total is the future value of an annuity due: FV = P × ((1 + i)ⁿ − 1) ÷ i × (1 + i). The extra (1 + i) is there because each instalment is invested at the start of its month. For example, 1,000 a month at 12% for 10 years grows to about 2,32,339 from 1,20,000 invested.
A step-up SIP raises the instalment every year — say by 10% — which lifts the final value a lot, because the larger amounts still have years to grow. The calculator works this out month by month.
A lump sum is invested once and compounds yearly: 1,00,000 at 12% for 10 years becomes about 3,10,585. Mutual fund returns are never fixed, so treat every figure here as an estimate of what a steady return would give, not a forecast.
What will 5,000 a month in a SIP become in 10 years?
Investing 5,000 a month for 10 years at an expected 12% a year,
you invest 600,000 in all, and it could grow to about 1,161,695.38 — estimated returns of 561,695.38.
Good to know
- Start early: the last few years of a long SIP often add more than the first ten.
- A yearly step-up of 5–10% in line with pay rises can raise the final value by a third or more.
- Use a conservative expected return — real fund returns go up and down and are never guaranteed.
- Remember tax on gains and exit loads when you plan withdrawals.
SIP questions
How is SIP return calculated?
With the future value of an annuity due: FV = P × ((1 + i)ⁿ − 1) ÷ i × (1 + i), where P is the monthly amount, i the yearly return ÷ 12 ÷ 100 and n the number of months. This is the method most fund-house SIP calculators use.
What will a 10,000 SIP be worth in 15 years?
At an expected 12% a year, about 50,45,760 (₹50.5 lakh) from 18,00,000 invested. At a lower return the value is much less, so try a few rates.
Is SIP better than a lump sum?
With the same return, money invested earlier grows more, so a lump sum invested today ends higher. A SIP spreads purchases over time (rupee-cost averaging), which lowers the risk of investing everything at a market peak and fits a monthly income.
What is a step-up SIP?
A SIP whose monthly amount rises by a fixed percentage every year. 5,000 a month stepped up by 10% a year at 12% for 10 years grows to about 16,87,163, against 11,61,695 without a step-up.
Are SIP returns guaranteed?
No. Mutual fund investments are subject to market risk, and past returns do not promise future ones. This calculator shows what a steady return would give, to help you plan.
Sources
- SEBI – Securities and Exchange Board of India
- AMFI – Mutual Funds Sahi Hai (investor education on SIPs)
- Future value of an annuity due (standard time-value-of-money formula)
Formulas last reviewed: September 30, 2026 ·How we check our formulas