1. What is SIP Future Value Calculation?

Systematic Investment Plan (SIP) future value calculation helps investors estimate the potential returns from regular monthly investments in mutual funds. It considers the power of compounding and regular investment discipline.

2. How Does the Calculator Work?

The calculator uses the SIP future value formula:

Where:

• \( FV \) — Future Value (INR)
• \( P \) — Monthly Investment Amount (INR)
• \( r \) — Annual Interest Rate (%)
• \( t \) — Investment Period (years)

Explanation: The formula calculates the future value of regular monthly investments considering monthly compounding of returns.

3. Importance of SIP Investment Planning

Details: SIP planning helps investors understand the power of compounding, set realistic financial goals, and make informed investment decisions for long-term wealth creation.

4. Using the Calculator

Tips: Enter monthly investment in INR, expected annual return rate in percentage, and investment period in years. All values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What is SIP in mutual funds?
A: SIP (Systematic Investment Plan) allows investors to invest a fixed amount regularly in mutual funds, promoting disciplined investing and rupee cost averaging.

Q2: How accurate is this calculator?
A: The calculator provides theoretical estimates based on fixed returns. Actual mutual fund returns may vary due to market fluctuations.

Q3: What is a reasonable expected return rate?
A: For Indian equity mutual funds, historical returns range from 10-15% annually, but past performance doesn't guarantee future returns.

Q4: Are SIP returns taxable in India?
A: Yes, SIP returns are subject to capital gains tax based on the holding period and type of mutual fund (equity or debt).

Q5: Can I change my SIP amount later?
A: Most mutual funds allow increasing, decreasing, or pausing SIP investments, though specific rules vary by fund house.