In ULIP, the investment risk in the investment portfolio is borne by the policyholder
SIP Calculator – Systematic Investment Plan Calculator
(Check the estimated returns from your SIP)
An SIP calculator is an easy-to-use online tool that helps you assess the potential returns on your SIP investments. Simply enter your monthly or yearly investment amount, tenure, and expected rate of return, and the SIP calculator will do the rest....It provides a clear idea of how much your money can grow over time, making investment decisions easier and more strategic. With this Systematic Investment Plan calculator, you can set realistic financial goals, compare different SIP options, and make informed decisions without any guesswork. Try it now and take the first step toward a secure financial future!Read more
Investment Amount(Monthly)
Interest Rate(P.A)
Investment Tenure(Years)
Consistent investing through SIPs helps you reach your financial goals, but a ULIP adds a layer of security, ensuring those goals are still attainable even if you're not around.
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What is an SIP Calculator?
SIP calculator, short forSystematic Investment Plancalculator, is an online financial tool. As you know, an SIP is a popular investment strategy that lets you invest small, regular amounts at fixed intervals. These investments can be mademutual funds, ULIPs (Unit Linked Insurance Plans), and similar financial instruments. And an SIP calculator is a tool helps you estimate the potential gains on your investments in such instruments.
Using such a calculator, you can input your monthly investment amount, duration, and expected returns. The calculator will then show you the future value of your investments and give you a clear idea of how much you might earn through your SIP.
How can an SIP Return Calculator help you?
Investors usually want to know the potential returns on their SIP investments before committing to a particular plan. and you might want the same for yourself. SIP return calculator helps you follow the best course for your monetary goals. By using such a calculator, you can::
Set Realistic Financial Goals:
An SIP return calculator helps you set achievable financial goals by estimating the returns you can expect from your investments. Whether it is planning for your child's education, buying a house, or building a retirement corpus, knowing how much your investments might grow lets you plan accordingly.
Compare Investment Options:
Choosing an investment plan is not as easy as simply opting for the first plan you discover. Then, how do you choose an SIP investment plan that suits you best? With the SIP return calculator, you can compare the potential returns of different SIP schemes likeULIPsor mutual funds. This allows you to make an informed choice and select the investment plan that aligns with your objectives and risk tolerance.
Monitor Progress:
Once you start your SIP, you can periodically use the calculator to track your investment's performance. from time to time. If you are not on track to meet your goals, you can make informed decisions to adjust your strategy, such as increasing your monthly contribution or extending your investment period. This helps you stay on course and make necessary adjustments to meet your goals.Take a step ahead for building your wealth!
How do SIP Calculators work?
Understanding how SIP calculators work is simpler than you think as they use a powerful yet simple formula to estimate returns.
Suppose you invest in an SIP and want to learn how much the potential returns will be. You can use an SIP calculator to estimate the future value of your investment. It takes into account these three main factors:
Investment Amount:This is the amount of money you plan to invest regularly, mostly on a monthly basis.
Investment Tenure:This is the duration for which you intend to invest. The longer you invest, the more time your money will get to grow, thanks to the power of compounding.
Expected Rate of Return:This is the annual return rate you anticipate from your investment. Although this rate is not guaranteed, it helps in estimating the potential growth based on historical data and market trends.
Using these inputs, the calculator calculates the future value of your investment, factoring in the power of compounding. The compounding effect is what makes SIP investments particularly lucrative over the long term
You can now calculate returns on SIP investment that you make in various funds using SIP calculator. Also, SIP investments should be made with 100% individual research or through financial advisors so you do not invest in the wrong funds or play your own losses. In such cases, if you calculate returns on SIP and then make one, it helps making informed, data-led decisions.
How are SIP Investment Returns Calculated?
The returns on your SIP investments are calculated using the compound interest formula. In simple terms, compound interest means you will earn interest not just on your initial investment but also on the interest that accumulates over time. This snowball effect can boost your investment’s growth significantly.
To use such a calculator, you need to input the numbers, and then the calculator will give you the results. This way, you can plan a better strategy for your investments, including how much to invest and what profits to expect in the future. Mostly, SIP calculations use the below-given formula:
FV = P × ((1 + r)n - 1) / r) × (1 + r)
Let us further explore what these denote and how to incorporate this formula for SIP return calculation.
SIP Calculation Formula
Formula:
FV = P × ((1 + r)n - 1) / r) × (1 + r)
Where:
- FV = Maturity amount (total value of your investment at the end of the tenure)
- P = SIP amount (the amount you invest every month)
- n = Investment duration
- r = Expected return rate per month (annual return rate divided by 12)
Here is an example to understand this better:
Suppose you invest ₹7,000 per month for 3 years (36 months) and expect an annual return of 10%.
Monthly return rate (r) = 10% ÷ 12 = 0.0083 (0.83%)
Number of months (n) = 36
Now, using the formula:
FV = 7000 × ((1 + 0.0083) 36 - 1) / 0.0083) × (1 + 0.0083)
After the calculation, the maturity amount would be ₹3,02,772. Here, the total invested amount would be ₹2,52,000, and estimated returns would be ₹50,772.
How to use SIP Calculator?
Using SIP calculator is a quick and hassle-free process. Just follow these simple steps:
Enter Your Details: Input the necessary information, including your monthly or yearly SIP investment amount, the investment tenure (in years), and your expected rate of return.
Get Your Estimate: Once you have filled in the details, the calculator will provide you with an estimated future value of your investment. This projection can be a powerful motivator to stay committed to your investment plan.
Adjust for Better Planning: Play around with different investment amounts, tenures, and return rates to see how small changes can impact your final corpus. This flexibility helps you make smart decisions and stay committed to your financial goals.
Advantages of using SIP Calculator
Incorporating an SIP calculator into your financial planning offers several advantages:
1.Accuracy:
The calculator uses strong algorithms to provide precise estimates of your investment’s future value, helping you make informed decisions.
2.User-Friendly:
The tool is designed to be user-friendly, and has an intuitive interface, making it accessible to even those new to investing as well as experienced investors.
3.Speed and Convenience:
Instant calculations save you time and effort, allowing you to focus on planning and assessing different investment scenarios.
4.Goal-Based Planning:
SIP calculator can help you set specific financial goals and determine the SIP amount required to achieve them. by letting you adjust variables.
5.Realistic Expectations:
By providing a realistic estimate of your future wealth, the calculator helps you set achievable financial goals and manage your expectations.
Conclusion
Starting on an investment journey can seem overwhelming, but tools like the SIP calculator simplify the process. Instead of doing manual calculations, you can use an SIP calculator online to get instant and accurate results, making your investment planning much easier.
By providing clear projections of your investment’s potential growth, it empowers you to make informed decisions and stay on track toward your financial aspirations. Whether you are new to investing or a professional, an SIP calculator can be invaluable in your investment toolkit!
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Financial well-being starts with a plan. You can check out more financial tools and calculators to get a head start in your financial journey.
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Disclaimers-
The information herein is meant only for general reading purposes and the views being expressed only constitute opinions and therefore cannot be considered as guidelines, recommendations or as a professional guide for the readers. The content has been prepared on the basis of publicly available information, internally developed data and other sources believed to be reliable. Recipients of this information are advised to rely on their own analysis, interpretations & investigations. Readers are also advised to seek independent professional advice in order to arrive at an informed investment decision. Further customer is the advised to go through the sales brochure before conducting any sale. Above illustrations are only for understanding, it is not directly or indirectly related to the performance of any product or plans of Kotak Life.