How To Calculate SIP Returns And Invest In SIP?

SIPs and mutual funds are sometimes confused by potential investors. SIPs, on the other hand, are just one of two ways to invest in mutual funds, the other being a lump payment. Systematic Investment Plan (SIP) is a method of regularly investing a fixed amount of money in mutual funds. Weekly, quarterly, or monthly investments are frequently possible with SIPs. A SIP calculator is a tool that assists you in calculating the returns you can expect when investing in such tools.

What is a SIP Calculator?

Nowadays, people prefer to invest in mutual funds through systematic investment plans or SIPs. SIP calculators are intended to provide prospective investors with information about mutual fund investments. The SIP calculator is an instrument that lets you figure out how much money you'll make from mutual fund SIP investments. It's an online calculator that calculates how much you should invest into your SIP to accomplish your financial goals based on a projected annual return.

How Can You Calculate Your SIP Returns?

Here is how you can calculate your SIP returns with the help of a SIP return calculator. The monthly contribution amount, the investment period, and the predicted yearly returns are commonly entered into a mutual fund SIP return calculator. 

• You must enter the monthly amount you desire to put in a fund. For example, depending on the amount you choose to invest, it might be as low as Rs. 500 or as high as Rs. 10,000 (or more).
• You should enter the investment's duration. You must choose the length of time for which you want to invest in the fund via SIP. In most cases, fund houses demand investors to commit to a SIP for at least six months. However, staying invested for a longer length of time (say three years or more) may help you earn decent returns.
• You must add the expected rate of return on the investment. The fund's prior performance is used to calculate this value.
• After you've entered these values, click the 'calculate' button to see how much money you could make in the given time frame. You can play with the values to see what works best for your budget and goals.

How Can You Invest in SIP?

If you're unsure how to get started using SIP, follow these three simple steps.

• Choose A Mutual Fund To Put Your Money Into

  You can pick from a variety of mutual funds available in the market. Choose a fund depending on your investment objectives and risk tolerance. To begin your investment adventure, complete the KYC process and submit an application form to the AMC online or offline.
  

• Select A Time Frame For Your Investment

  After you've chosen a fund, you'll need to decide how long you want to keep your money in it. Depending on your investment objectives, the length could range from 6 months to 10 years.

• Make Regular investments

  Choose a date on which you want to invest every month. Investing with SIPs is a simple and practical way to build long-term wealth. That is why it is crucial to remain involved for the duration of the investment.

Conclusion

Systematic Investment Plans are funds to which several participants make regular contributions. These funds' managers invest their assets in a variety of financial products such as debt, stock, government bonds and so on. Fund managers select products that provide the best returns with the least amount of risk. If you've recently started investing and want to know your future earnings, you can use one of several online calculators. 

Also read: Are Gold Investments Better Than SIPs?    

SIP or FD: Which Is the Better Option?

Disclaimer: This article is issued in the general public interest and meant for general information purposes only. Readers are advised not to rely on the contents of the article as conclusive in nature and should research further or consult an expert in this regard.