Calculate systematic investment plan returns with monthly contributions, expected returns, and wealth accumulation projections over time.
A systematic investment plan (SIP) is a habit: the same fixed amount, invested at the same fixed interval, usually monthly. This tool projects where that habit ends up by compounding your monthly contribution at an assumed annual return over the chosen horizon. Enter the monthly amount, the expected return, and the number of years, and it returns the estimated final value alongside the total you contributed and the growth on top. The thing most users misread: the result is a projection of the rate you typed in, not a promise of what a fund will pay, and that assumed rate - not your monthly amount - is what ultimately drives the outcome.
A concrete input and expected output from the current implementation.
Input
Monthly contribution Rs 10,000; expected annual return 12%; duration 10 years
Expected output
Estimated final value: Rs 23,23,391. Total invested: Rs 12,00,000. Estimated gains: Rs 11,23,391.
Each monthly Rs 10,000 is compounded at 1 percent per month (12 percent annual divided by 12) for 120 months, with each contribution treated as invested at the start of its month, giving 10,000 x ((1.01^120 - 1) / 0.01) x 1.01, which rounds to Rs 23,23,391. Subtracting the 120 contributions of Rs 10,000 leaves Rs 11,23,391 of compounding gains.
The tool applies the future-value-of-an-annuity calculation: FV = P x ((1 + i)^n - 1) / i x (1 + i), where P is the monthly contribution, i is the annual rate divided by 12, and n is the number of months. The trailing (1 + i) factor treats each contribution as invested at the start of its month, the standard SIP convention, which adds roughly half a month of compounding to every contribution.
The same annual rate is applied to every month of the horizon; there is no simulation of good and bad years. Because compounding is exponential, the output swings hard with the assumed rate - a one-percentage-point change can shift a long-horizon result by tens of percent - and the figure is not adjusted for inflation, taxes, or any fund's actual track record.
No. The tool compounds your assumed annual return uniformly across the whole period, as if the market delivered the same rate every month. Actual fund returns vary year to year, so treat the output as a planning figure: run it at a conservative and an optimistic rate and use the range between them as your expectation, not the single number.
Compounding. Each contribution grows for the rest of the horizon and the gains themselves earn returns. Over 10 years of Rs 10,000 monthly at 12 percent you invest Rs 12,00,000 and the tool projects about Rs 23,23,391, so roughly Rs 11,23,391 is compounded growth. Longer horizons and higher assumed rates widen that gap quickly.
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