SIP Calculator: Calculate SIP Returns, Real Costs & Post-Tax Value
A Systematic Investment Plan (SIP) is a disciplined method of investing a fixed amount in mutual funds every month. Instead of waiting to accumulate a large sum, SIP lets you start small, invest consistently, and grow wealth over time through compounding.
This SIP Calculator is built for Indian investors. Unlike most SIP calculators, this page also shows you what you actually keep after the expense ratio and capital gains tax — because the headline number every calculator displays is not the money that reaches your bank account.
What is a SIP (Systematic Investment Plan)?
A SIP is a facility offered by mutual funds that lets you invest a fixed, predetermined amount at regular intervals — usually monthly. It removes the need to time the market and makes investing accessible at any income level.
SIP helps investors:
- Invest regularly in equity, debt, or hybrid mutual funds
- Reduce the impact of market volatility through rupee cost averaging
- Build long-term wealth through compounding
- Develop consistent financial discipline without lump-sum capital
SIP has become the dominant retail investing route in India. According to AMFI data, monthly SIP contributions reached ₹31,961 crore in July 2026, up 12.28% year-on-year, with 61.44 lakh new SIPs registered that month. (Source: AMFI monthly data, July 2026.)
How Does a SIP Calculator Work?
A SIP calculator uses the future value formula for recurring investments. It calculates how your monthly contributions grow based on an assumed rate of return and investment duration, using monthly compounding.
SIP Future Value Formula:
FV = P \times \frac{(1 + r)^n - 1}{r} \times (1 + r)Where:
- FV = Future value of the investment
- P = Monthly SIP amount (₹)
- r = Monthly rate of return (annual rate ÷ 12)
- n = Total number of months (years × 12)
If your assumed annual return is 12%, then r = 12% ÷ 12 = 1% per month (0.01). The trailing (1 + r) term accounts for each installment being invested at the start of the month, which is how SIP auto-debits actually work.
What this formula does not account for
This is the standard formula used by every SIP calculator in India, and it carries three assumptions worth stating plainly:
- Returns are constant. Real mutual fund returns vary every month. A fund that averages 12% over 20 years will not deliver 12% in any individual year.
- Costs are excluded. The expense ratio is deducted from NAV before you see it, so your realised return is lower than the fund’s gross return.
- Tax is excluded. Capital gains tax applies on redemption.
The section on what you actually keep below quantifies all three.
How to Use the SIP Calculator
- Enter your monthly SIP amount — the fixed amount you plan to invest each month (e.g. ₹5,000)
- Select investment duration — how many years you plan to stay invested (e.g. 15 years)
- Set expected annual return — your assumed rate of return (e.g. 12%)
- Review the results — total invested, estimated returns, and final corpus
SIP Calculation Example
- Monthly SIP: ₹10,000
- Duration: 20 years (240 months)
- Assumed annual return: 12%
Applying the formula:
- Total invested: ₹10,000 × 240 = ₹24,00,000
- Estimated returns: ₹75,91,479
- Final corpus: ₹99,91,479
Roughly 76% of the final corpus comes from returns, not from your own contributions — the effect of compounding over a long holding period.
What You Actually Keep: Expense Ratio and Tax
Every SIP calculator, including the one above, shows a gross figure. Two costs sit between that number and your bank account.
Expense ratio. A fund’s NAV is published after the expense ratio is deducted. If a scheme generates 12% gross and charges a 1.5% expense ratio (typical for a regular plan), your realised return is about 10.5%. A direct plan of the same scheme, at roughly 0.5%, gives you about 11.5%.
Capital gains tax. Applied on redemption, at the rates in the tax section below.
Here is the same ₹10,000 monthly SIP over 20 years, run through all three scenarios:
| Scenario | Corpus | Total gain | LTCG tax | Amount in hand |
|---|---|---|---|---|
| Calculator figure (12% gross, no costs, no tax) | ₹99,91,479 | ₹75,91,479 | — | ₹99,91,479 |
| Direct plan (0.5% expense ratio → 11.5% net) | ₹93,39,459 | ₹69,39,459 | ₹8,51,807 | ₹84,87,652 |
| Regular plan (1.5% expense ratio → 10.5% net) | ₹81,75,913 | ₹57,75,913 | ₹7,06,364 | ₹74,69,549 |
Two findings worth absorbing:
- The headline ₹99.91 lakh becomes ₹74.70 lakh for a regular-plan investor — a gap of ₹25.2 lakh, or about 25% of the number the calculator displayed.
- A 1% difference in expense ratio costs ₹10.18 lakh over 20 years on a ₹10,000 SIP. Choosing a direct plan over a regular plan is one of the highest-return decisions available to a retail investor, and it takes one click at the time of purchase.
Assumptions: 12% gross annual return, monthly compounding, entire corpus redeemed in a single financial year, one ₹1.25 lakh LTCG exemption applied. Surcharge and cess are not included. Staggering redemption across financial years reduces the tax, since the exemption resets annually.
SIP Tax Rules in India (2026)
Capital gains tax on equity mutual funds changed on 23 July 2024, and many calculator pages still publish the older figures. The current rules:
| Gain type | Holding period | Tax rate | Exemption |
|---|---|---|---|
| Long-term (LTCG) | More than 12 months | 12.5% | ₹1.25 lakh per financial year |
| Short-term (STCG) | 12 months or less | 20% | None |
Both rates carry applicable surcharge and cess. Budget 2026 left the rate and the exemption threshold unchanged. The ₹1.25 lakh exemption is shared across all Section 112A gains — equity mutual funds and listed shares combined, not per scheme.
The SIP tax rule almost nobody explains
Each SIP installment is a separate purchase lot with its own holding period, and redemption follows FIFO (first in, first out). This has a consequence that surprises most first-time investors:
If you start a SIP in January and redeem the whole thing 12 months later, only the first installment has crossed 12 months and qualifies for the 12.5% LTCG rate. The remaining eleven are short-term and taxed at 20%.
For a SIP to be fully long-term, the last installment must have completed 12 months — meaning a SIP you ran for three years needs to be held for four before every unit qualifies. Planning your exit around this single rule can be worth several percent of your corpus.
ELSS and Section 80C
ELSS (equity-linked savings scheme) SIPs qualify for a deduction of up to ₹1.5 lakh under Section 80C — but only if you file under the old tax regime. The new regime, which has been the default since FY 2023-24, does not allow 80C deductions. If you are on the new regime, ELSS offers no tax deduction, though it remains a valid equity investment with a three-year lock-in.
Exit Load: The Cost of Redeeming Early
SIPs are flexible — you can pause, stop, increase, or reduce them at any time. Redeeming, however, is not always free.
Most equity mutual funds charge an exit load of 1% on units redeemed within 12 months of purchase. Because of the FIFO rule above, this applies lot by lot: units bought in the last twelve months attract the load even if the SIP itself has been running for years. ELSS funds have no exit load but do carry a mandatory three-year lock-in per installment.
Always check the scheme information document for the specific exit load structure before redeeming.
SIP Returns: What Rate Should You Assume?
Commonly used long-term assumptions for Indian mutual fund categories:
- Large cap equity funds: 10% – 12% annually
- Mid cap / small cap funds: 12% – 15% annually (materially higher volatility)
- Hybrid / balanced funds: 9% – 11% annually
- Debt funds: 6% – 8% annually
These are assumptions used for planning, not forecasts. Mutual fund returns are market-linked and not guaranteed. A 12% long-run average does not mean 12% in any given year — equity funds routinely deliver negative returns in individual years and above-average returns in others. Building a plan that only works at exactly 12% is fragile; test your goal at 9% and 10% as well before committing to it.
The Power of Compounding in SIP
Compounding means your returns also earn returns. In a SIP, every installment begins compounding from the day it is invested, so earlier installments do far more work than later ones.
In the 20-year example above, the first installment compounds for 240 months while the last compounds for one. This is why starting early matters more than investing more later.
Key principles:
- Time in the market matters more than timing the market
- Small increases in monthly SIP compound into disproportionately large differences over 15–25 years
- Redeeming early breaks the compounding chain and triggers both exit load and short-term tax
SIP vs Lumpsum Investment
| Feature | SIP | Lumpsum |
|---|---|---|
| Best for | Salaried investors with monthly income | Investors with surplus capital |
| Market timing risk | Lower (rupee cost averaging) | Higher (entry point dependent) |
| Discipline | Enforces a regular investing habit | One-time decision |
| Minimum amount | From ₹100–₹500/month, scheme dependent | From ₹100–₹5,000, scheme dependent |
| Typical horizon | 5 to 30+ years | 3 to 10+ years |
For most salaried investors, SIP is the practical starting point — it matches the cash flow you actually have and removes the entry-timing decision.
Types of SIP in India
- Regular SIP — a fixed amount invested at fixed monthly intervals. The most common type.
- Step-Up SIP (Top-Up SIP) — the monthly amount increases annually by a fixed percentage or amount, aligned with income growth.
- Flexible SIP — lets you modify the installment based on monthly cash flow. Useful for variable incomes.
- Perpetual SIP — runs with no end date; you stop it manually when the goal is met.
- Trigger SIP — investments triggered by market events or index levels. Suited to experienced investors only.
Step-Up SIP: What the Comparison Usually Hides
A Step-Up SIP increases your monthly investment every year, typically by 5% to 15%, in line with salary growth.
Fixed SIP vs Step-Up SIP — 20 years, 12% assumed return:
| Fixed SIP | Step-Up SIP (10% annual increase) | |
|---|---|---|
| Starting monthly amount | ₹10,000 | ₹10,000 |
| Monthly amount in year 20 | ₹10,000 | ₹61,159 |
| Total invested | ₹24,00,000 | ₹68,73,000 |
| Final corpus | ₹99,91,479 | ₹1,98,86,000 |
Most step-up comparisons stop at the corpus figures and present the difference as though it were free. It is not. The step-up investor ends with roughly double the corpus because they invested nearly three times as much money. The genuine advantage of a step-up is not a higher return — it is that the increases are affordable, since each one is funded by a salary increment you have already received.
Model your own increment rate with the Step-Up SIP Calculator.
Common SIP Mistakes to Avoid
- Stopping SIP during market downturns — falling markets are when your fixed amount buys the most units. Stopping breaks the averaging and the compounding.
- Redeeming before 12 months — triggers a 1% exit load and 20% short-term capital gains tax on those units.
- Choosing a regular plan by default — the 1% expense ratio difference costs over ₹10 lakh across 20 years on a ₹10,000 SIP.
- Planning around a single assumed return — build the plan so it still works at 9–10%.
- Ignoring inflation — ₹1 crore in 2046 will not buy what ₹1 crore buys today. Check the real value with the Inflation Calculator.
SIP for Long-Term Financial Goals
- Retirement: a 25–30 year SIP horizon in equity funds gives compounding the runway it needs.
- Child’s education: starting when a child is born provides 18+ years of compounding.
- Home down payment: a 5–7 year SIP in hybrid funds accumulates the deposit systematically.
- Emergency corpus: debt fund SIPs provide stable, low-volatility growth.
To work backwards from a target amount to the monthly SIP required, use the Goal SIP Calculator.
Assumptions Used in This Calculator
- A constant annual return is applied across the entire period; real returns vary year to year
- Returns are compounded monthly, with installments treated as invested at the start of each month
- Expense ratio is not deducted from the headline figure — see the table above for post-cost values
- Capital gains tax is not deducted from the headline figure — LTCG is 12.5% above ₹1.25 lakh per financial year, STCG is 20%
- Exit load is not modelled — typically 1% on units held under 12 months
- Inflation is not applied — the corpus is shown in nominal, not real, terms
Mutual fund investments are subject to market risk. Read all scheme-related documents carefully. This calculator is an estimation tool, not investment advice.
Related Calculators
- Goal SIP Calculator — find the monthly SIP needed to reach a target corpus
- Step-Up SIP Calculator — model annual increases in your SIP amount
- Lumpsum Investment Calculator — compare one-time investments against SIP
- Inflation Calculator — see the real purchasing power of your future corpus
- SWP Calculator — plan monthly withdrawals once the corpus is built
- Cost of Delay Calculator — quantify what starting late costs you
A SIP Calculator estimates the future value of monthly mutual fund investments using the formula FV = P × [(1 + r)^n − 1] / r × (1 + r), where P is the monthly SIP amount, r is the monthly return rate, and n is the total number of months. The trailing (1 + r) reflects installments being invested at the start of each month. Enter your amount, duration, and expected return to see your total investment and estimated corpus. Note that the result is a gross figure — it does not deduct the fund’s expense ratio or capital gains tax.
Each SIP installment is a separate purchase lot with its own holding period, and redemption follows FIFO. Units held more than 12 months are taxed as long-term capital gains at 12.5%, with the first ₹1.25 lakh of gains in a financial year exempt. Units held 12 months or less are taxed as short-term capital gains at 20%, with no exemption. Both rates attract applicable surcharge and cess. This means a SIP redeemed exactly 12 months after starting will have only one installment qualifying for the lower long-term rate.
Three reasons. First, the expense ratio is deducted from NAV before you see it — a 1.5% expense ratio on a fund generating 12% gross leaves you roughly 10.5%. Second, capital gains tax applies on redemption. Third, the calculator assumes a constant return, while real fund returns vary every year. On a ₹10,000 monthly SIP over 20 years, the gap between the calculator’s ₹99.91 lakh headline and a regular-plan investor’s post-tax ₹74.70 lakh is about ₹25 lakh.
A direct plan is bought straight from the fund house with no distributor commission; a regular plan is bought through a distributor and carries roughly 1% higher expense ratio. The scheme, portfolio, and fund manager are identical. Over 20 years on a ₹10,000 monthly SIP, that 1% difference costs approximately ₹10.18 lakh in final corpus. Direct plans are identified by “Direct” in the scheme name.
There is no universal figure — it depends on your target amount, timeline, existing savings, and monthly surplus after essential expenses and an emergency fund. Rather than applying a fixed percentage of income, work backwards from the goal: the Goal SIP Calculator computes the monthly amount needed to reach a specific corpus in a given number of years. Start with what is sustainable, since a SIP you can maintain for 15 years beats a larger one you stop after two.
Over horizons of 7 years or more, equity mutual fund SIPs have historically delivered higher returns than fixed deposits, but they are market-linked and can lose value in any given period. FD returns are guaranteed and taxed at your income slab rate, while equity SIP gains held over 12 months are taxed at 12.5% above the ₹1.25 lakh exemption. FDs suit capital preservation and short-term goals; equity SIPs suit long-term wealth creation where you can tolerate volatility.
Missing one or two installments does not attract a penalty from the fund house — the SIP simply skips that month. Your bank may charge a mandate failure fee. If three or more consecutive installments fail due to insufficient balance, most fund houses cancel the SIP automatically and you will need to register a new one. The larger cost is the compounding those installments would have generated.
Yes. You can pause, stop, increase, or decrease a SIP at any time through the fund house portal or app, usually with a few days’ notice before the next debit date. Stopping the SIP does not force redemption — your existing units stay invested. Redeeming is separate and may attract an exit load of around 1% on units held under 12 months, plus capital gains tax. ELSS units cannot be redeemed before completing three years from each installment date.
Rupee cost averaging is the effect of investing a fixed amount at regular intervals regardless of market level. When NAV falls, your fixed amount buys more units; when it rises, it buys fewer. Over a full market cycle this averages your per-unit cost and removes the need to time entry. It reduces timing risk but does not eliminate market risk — a fund that performs poorly over your entire holding period will still produce a poor outcome.
Most Indian mutual funds accept SIPs from ₹500 per month, and a number of schemes allow ₹100. There is no upper limit. The minimum varies by scheme and is stated in the scheme information document. Starting at ₹1,000–₹2,000 early carries more weight than a larger amount started years later, because the earliest installments compound the longest.
Final Word
The most valuable input in a SIP is time, and it is the one input you cannot increase later. Every month of delay is compounding you do not get back — quantified precisely by the Cost of Delay Calculator.
Use the calculator above to test different amounts, durations, and return assumptions. Then use the post-cost table on this page to check what those figures look like after the expense ratio and tax — because that is the number that actually reaches you.
