There are two investment modes for a mutual fund investment. The two modes are the lumpsum investment mode and the SIP (systematic investment plan) mode. By opting for the SIP mode, you can invest in your mutual fund regularly every month. On the other hand, you invest in your mutual fund in full in the lumpsum mode. Whether a lump sumor SIP investment, have a clear idea of the investment amount. Use a SIP calculator if you want to determine your required investment amount.
What is a SIP calculator?
A SIP calculator is an online mutual fund calculator that gives you an idea of the returns your portfolio could enjoy when you invest in SIP. They are a popular investment mode among young professionals as SIP investments do not require full-time payment like the lumpsum mode. However, they do not provide the exit load and expense ratio. The calculator will calculate the estimated returns by using the following formula:
M = P × ({[1 + i]^n – 1} / i) × (1 + i).
In the formula above:
- M =The amount you could receive on maturity
- P = The amount invested
- N = Payments made
- I = Rate of interest
How do SIP calculators work?
The Systematic Investment Plan Calculator helps you find different investment-worthy products within your affordable range. It does so by using data inputs of your details.
What are their benefits?
Here are the six advantages associated with SIP calculators:
- Instant calculation:
Systematic investment plan calculators are easy to use. Just fill in some details and get the required investment amount instantly.
- Personal schemes:
SIP calculators provide personalised results. A SIP calculator shows different plans when you input personal details. A personalised scheme will cater to your investment capabilities and risk appetite.
- Accommodates small amounts:
You can also invest in lower amounts if you do not have enough money. These calculators can also help you find products in a lower price range. Just set a lower limit on the calculator. You can later opt for expensive investments from the returns of small investments.
- Up-to-date investment options:
Systematic Investment Plan Calculators consider real-time stock values for SIPs. So, you can see the present condition of the market. These calculators also provide the projected growth of each mutual fund scheme based on its past performance.
- Systematic approach:
These calculators have a systematic approach to systematic investment plans as they provide insight into how to invest in SIP. You also get an idea of ways to diversify your investments, investment amount, and duration by using SIP calculators.
- Free-of-cost:
SIP calculators are free to use, and they are easily accessible online. You can use these calculators regardless of your location, and there are no restrictions on the number of times you can use them.
Conclusion:
Systematic investment plan calculators will help you choose the best SIP that can help you increase your wealth. You can learn the different investment possibilities for your SIP requirements. These calculators help you create the perfect SIP mutual fund portfolio.