SIP stands for Systematic Investment Plan. It allows you to invest a fixed amount regularly (monthly or quarterly) into mutual funds or other investments, helping you benefit from compounding and rupee cost averaging.

Does this investment calculator account for inflation?

No, this calculator shows nominal returns. To estimate real returns, subtract the inflation rate from your expected annual return. For example, if returns are 10% and inflation is 4%, use 6%.

Watch your money grow.

Estimate the future value of your investments using the power of compound interest.

Currency

Initial Deposit (Lump Sum)

Monthly Contribution

Exp. Return Rate (p.a) 8%

Conservative (1%) Aggressive (30%)

Time Period 10 Years

Total Future Value

$0

Invested Growth

Your Money

Wealth Gained

Total Invested $0

Est. Returns $0

Compounding Effect

Notice how the green portion of the bar grows larger as time increases. That is your money working for you.

The Magic of Compound Interest

Albert Einstein reportedly called compound interest the "eighth wonder of the world." Unlike simple interest, where you only earn returns on your principal, compounding means you earn returns on your returns. Over long periods (10+ years), the interest you earn can actually exceed the amount of money you originally invested.

How is it calculated?

This calculator uses the Future Value formula, assuming monthly compounding for better accuracy with monthly contributions (SIPs).

Formula (simplified):
A = P × (1 + r)^n
Where P is Principal, r is rate, n is time.

Why start early?

Consider two investors:

Person A: Invests $500/mo from age 25 to 35, then stops.
Person B: Starts at 35 and invests $500/mo until 60.
Surprisingly, Person A often ends up with more money at retirement due to the extra 10 years of compounding!

Investment Strategies

🏦

Conservative

FDs, Bonds, Gold. Returns: 3% - 6%. Low risk, steady growth.

📈

Balanced

Mutual Funds, Index Funds. Returns: 8% - 12%. Moderate risk.

🚀

Aggressive

Direct Stocks, Crypto. Returns: 15%+. High risk, high reward.

Frequently Asked Questions

What is SIP?

SIP stands for Systematic Investment Plan. It allows you to invest small amounts of money periodically (monthly/quarterly) into mutual funds or other assets, averaging out the cost of buying over time.

Does this account for inflation?

No, this calculator shows the nominal value. To estimate "real" purchasing power, you should subtract the inflation rate from your expected return rate (e.g., if you expect 10% return but inflation is 4%, use 6% in the calculator).