Advantages of Using a SIP Calculator

Personal Finance

Some people wrongly think that SIPs, as well as mutual funds, are the same thing. However, SIPs are simply one way of investing in mutual funds, while the other way is a lump sum payment. 

A SIP calculator is a tool that assists you in figuring out the profits you may get when investing in mutual funds. SIP, or Systematic Investment Plan, is a method of investing a certain sum of funds in mutual funds at frequent cycles. SIPs often enable you to invest monthly, quarterly, or weekly. As a result, a SIP calculator may be of great assistance in making the correct SIP option. The SIP calculator may be a useful tool when starting a SIP investment.

What Exactly is a SIP Calculator?

A SIP Calculator, often known as the Systematic Investment Plan Calculator, gives a numerical summary of your SIP. The SIP is often used to fulfil long-term financial aims, so the SIP calculator has become a vital tool. 

The SIP calculator assists you in figuring out the profits you can make by putting money in a mutual fund. As you may know, SIPs may be weekly, monthly, or quarterly. But, monthly SIPs are generally the most common since they match your monthly revenue flow. A SIP calculator allows an investor to assess the returns on mutual fund investments using SIP. 

SIP calculators are meant to give you estimates of your investments. You may predict how much a certain SIP sum would rise over a specific period at an expected rate of return. 

The Advantages of Using a SIP Calculator

SIPs are a great method to maximise your mutual fund investment. They give good profits starting with a small investment. However, before you invest your money, you need to know which SIP would assist you in reaching your goals. 

  • Exact Results

With a SIP Investment Calculator, you can get accurate results. It is the first element of taking measured risks. You must offer data such as the monthly sum, the term, and the planned return. Will investing in debt, liquid, or equity funds meet your needs? With this data, you’ll be able to determine the full sum invested, the overall maturity sum, and the sum you’ll earn on your mutual funds. 

  • Quicker Results

The SIP calculator produces results much quicker than manually doing calculations. In addition, you obtain data on your total invested money, maturity sum, and SIP income in a single calculation. You won’t have to run multiple estimates to acquire varied profit amounts this way. The extra benefit is that you may access it at any moment without having to perform arithmetics or find a real calculator.

  • Assists in Making Better Decisions

One of the main perks of utilising a SIP calculator is the ability to predict your investment ways and compare various results. You may test with different periods and amounts to see how your SIP is impacted. This, in turn, assists in determining the optimal tenure and quantity to reap the most useful returns.

You can invest the money needed to reach your long-term aims. For example, you calculate that after retirement, you would need a monthly stipend of Rs. 25,000. You may now predict the sum you would have to invest in attaining the desired amounts using the SIP calculator.

  • Enables You to Make an Educated Choice

You may view the possible returns on multiple SIPs with the same time length and investment sum by entering the interest rate into the SIP calculator. You can grasp how to engage in SIP after comparing the outcomes of different choices. As a result, choose the SIP that will help your mutual funds perform safely and profitably.

  • Simple Availability

Online SIP calculators are widely usable. They are also usually free to use on most sites.

How Does a SIP Calculator Function?

The SIP Calculator computes the exact cost of your investment based on the data you provide. Some vital metrics you must use when utilising it are listed below.

Step 1: First, input the sum that you’ll be able to set away regularly. You may start investing in top mutual funds with as little as Rs. 500. In contrast, the minimum investment amount for all other current plans is normally Rs. 1,000.

Step 2: After that, you should consider the potential rate of return on your investment. The study includes taking into account the history of the funds you are examining.

Step 3: After that, specify the investment’s time frame. This is useful if you want to invest for a certain length of time, whether in short-term or long-term mutual funds. For instance, you may wish to start saving for higher education as soon as your child is born. In this case, the investment term has already been set from your kid’s childhood to the time of his/her education.

Step 4: If you own an existing SIP, input the number of instalments you have made.

How To Use the SIP Calculator?

  • When you pick to spend in a SIP, you will have a monetary aim or a specific sum in mind.
  • In the first case, the SIP return calculator informs you how much you have to invest each month and how long it will take to reach your objective. Your monthly payment will be smaller if you invest for a longer time, and vice versa.
  • If you have a set sum of money to put in a SIP each month, the SIP calculator will show you how much you may make if you invest it for a set time. 


If you want to discover how much your SIP investment will be worth at maturity, consider your monthly amount, the rate of return, and the investment period. Adding all three together makes calculating the return by hand rather hard. In the blink of an eye, a digital SIP return calculator can give you the expected return. It gives a review of your overall investment and future profits. SIP calculators assist you in making the best SIP investment choice.

If you want to know more about SIP calculators, visit Piramal Finance for related blogs and explore their products and services.