Imagine being blindfolded, and then asked to ride a roller coaster. You don’t know when it will climb or fall. The same is true for the financial market. You never know what direction it will go. The Systematic Investment Plan allows you to invest at regular intervals, keeping your investment cost low. You can use the SIP calculator to determine how much smaller investments on a regular basis will yield you higher returns.
What is SIP Planner?
SIP Planner is an online tool that allows you to easily calculate the returns from SIP investments. It calculates your investment over time and the expected percentage of returns based on your risk appetite. This tool assists investors in making smart investment decisions and planning for various financial goals.
These are the details you will need to enter in SIP calculator
- Enter the amount you wish to invest in any fund through SIP mode.
- No. Number of Installments: Enter the number of installments you intend to invest. This can be weekly or monthly, as well as quarterly, annually, or even annual.
- Time Horizon A person’s time horizon is determined by his age. If you are below 30 years old, you can stay invested for around 20 years. If you’re between 30 and 50 years old, however, you can stay invested for 15-25 year. If you are between 51 and 60 years old, you can stay invested for 6-10 year, while those over that age may be invested for 3-5. You can withdraw from any fund at your discretion. This time-limit is only for long-term investments.
- Expected Return: Your risk appetite will determine the expected rate of return. Your returns could be between 15-20% if you are a high-risk investor. If you’re a moderate investor your returns could be between 12-15% and 8-12% if conservative investors.
SIP Calculator Example
Mr. Kapoor has invested Rs. Rs.5000 per month for five years. He would like to buy a new car. He expects 15% in returns.
Total investment:
5,000 multiplied 5 years times 12 months.
5,000*5*12 = 3,00,000
After 5 years, his expected return would be Rs 4,48 408/-.
His wealth gain is therefore 1,48,408.
Thus, he has earned Rs 4,48,408 by investing Rs 5,000 per monthly for five years. You can calculate this using the SIP calculator.
Why use SIP?
The Systematic Investment Plan, or SIP, is easy on your wallet. You will need to pay less at regular intervals. It will lower your financial burden and help you meet other financial needs. SIP returns calculator allows you to calculate your risk appetite. SIP helps manage market volatility and creates wealth.
SIP can be used to plan your goals. To reach your 20-year goals, you may begin investing now. We, as financial experts, would suggest you ignore short-term gains when the market offers you more as long-term investors. Financial experts advise that you be a long-term investor because it is more likely to win financial freedom.