How are SIP returns calculated?
A Systematic Investment Plan (SIP) invests a fixed amount every month into a mutual fund. Each instalment buys units at that month’s price and then compounds for the rest of the tenure, so the money you invest early does the most work. Because each instalment grows for a different length of time, the maturity value is the sum of many small compounding streams.
This calculator uses the annuity-due method — it assumes each SIP is invested at the start of the month — which matches how most Indian fund platforms show projected returns.
SIP of ₹5,000, ₹10,000 and ₹25,000 a month
At an assumed 12% annual return over 10 years, the maturity value scales with the monthly amount. Notice how the gains component grows faster than the amount invested — over a long horizon, more than half the maturity value can come from returns rather than your own contributions.
| ₹5,000 / mo | ₹11.6 lakh |
| ₹10,000 / mo | ₹23.2 lakh |
| ₹25,000 / mo | ₹58.1 lakh |
SIP vs lumpsum — which grows more?
A lumpsum invests everything on day one, so at the same return it usually ends higher than a SIP of the same total, simply because the full amount compounds for longer. But most people don’t have a lumpsum to invest — and a SIP spreads your entry across market highs and lows (rupee-cost averaging), which lowers the risk of investing everything at a peak. The right choice depends on whether you have money to invest now or you earn it monthly.
What return should you assume?
Equity mutual funds in India have historically delivered roughly 10–13% a year over long periods, but past returns don’t guarantee future ones. For a realistic projection, use a conservative figure and treat anything above it as a bonus. Debt and hybrid funds return less. Whatever you pick, remember the projection is an estimate, not a promise.