Quick answer: A SIP grows as FV = P × [((1+r)n − 1) ÷ r] × (1+r), where P is the monthly contribution, r the monthly return and n the number of months. Use this SIP calculator monthly investment planner below: enter your monthly amount, expected annual return and years to see total invested, gains and final value.
Last reviewed: September 2026
Key facts
- FV = P × [((1+r)n − 1) ÷ r] × (1+r) — the standard SIP formula with monthly compounding.
- Time beats timing: gains grow fastest in the later years because compounding builds on earlier growth.
- The projected return is an assumption, not a guarantee — test 8%, 10% and 12% to see the range.
- Raising your contribution even slightly early on adds more to the final value than the same rise near the end.
Use this SIP calculator monthly investment planner to turn a fixed monthly contribution into a growing investment through compound returns. It estimates your total invested amount, the gains earned and the projected final value from your monthly contribution, expected annual return and investment period.
Enter your numbers and instantly see the projected value, total invested and total gains with a visual split. No sign-up, works on mobile and desktop.
How to use
- Enter your monthly contribution (e.g. 500).
- Enter the expected annual return % — a realistic long-term assumption.
- Enter the investment period in years.
- Optionally add a currency symbol, then read your projected value.
How SIP growth is calculated
| Term | Meaning |
|---|---|
| P | Monthly contribution, invested at the start of each month. |
| r | Monthly return = annual return ÷ 12 ÷ 100. For 10% annual, r = 0.008333. |
| n | Total months = years × 12. |
| FV | Projected future value. Gains = FV − (P × n). |
Each monthly instalment compounds from the month it is invested, so earlier contributions earn more. The × (1+r) factor reflects investing at the start of each month.
A brief history of systematic investing
The idea behind the SIP is older than the name. In The Intelligent Investor (1949), Benjamin Graham advocated dollar-cost averaging: investing a fixed amount at regular intervals so that more units are bought when prices are low and fewer when prices are high, smoothing out market timing risk. Mutual fund companies later packaged this habit as the "systematic investment plan," first popularized in the United States and then widely adopted in markets such as India, where monthly SIPs into equity funds became one of the most common ways households invest. The mathematics underneath has not changed since: a stream of equal periodic payments growing at a constant rate is an annuity due, whose closed-form future value is exactly the formula this SIP calculator uses.
SIP calculator monthly investment scenarios
Small changes in the assumed return or the time horizon move the projected value far more than small changes in the contribution do. The table below, computed with the same formula as the calculator, fixes the monthly contribution at 500 and varies the annual return and horizon:
| Annual return | 10 years | 15 years | 20 years |
|---|---|---|---|
| 8% | 92,083 (32,083 gains) | 174,173 (84,173 gains) | 296,474 (176,474 gains) |
| 10% | 103,276 (43,276 gains) | 208,962 (118,962 gains) | 382,848 (262,848 gains) |
| 12% | 116,170 (56,170 gains) | 252,288 (162,288 gains) | 499,574 (379,574 gains) |
Two patterns stand out. First, extending the horizon from 10 to 20 years roughly quadruples the projected value at 10%, while the invested amount only doubles. Second, a 2-percentage-point difference in return compounds into a difference of tens of thousands over two decades, which is why the key-facts box advises testing 8%, 10% and 12% rather than trusting a single projection.
SIP vs lump sum vs recurring deposit
An SIP is one of three common ways to build a corpus from savings. A lump sum invests everything at once; a recurring deposit (RD) contributes monthly at a fixed, guaranteed rate. Comparing the three for a 10-year horizon at a 10% assumed market return (7% fixed for the RD):
| Approach | Cash flow | Projected value (10 yrs) | Key trade-off |
|---|---|---|---|
| SIP: 500/month at 10% | 60,000 total, spread out | 103,276 | Market risk; no timing pressure |
| Lump sum: 60,000 on day one at 10% | 60,000 up front | 155,625 | Higher value if markets rise, but all timing risk is concentrated on one day |
| RD: 500/month at fixed 7% | 60,000 total, spread out | 87,047 | Guaranteed rate, but lower expected return than market-linked options |
The lump sum wins on paper when the same total is available on day one, because every unit compounds for the full period. In practice most savers accumulate income month by month, which is exactly the situation the SIP is designed for: it converts a monthly salary habit into invested capital without requiring a large starting balance or a market-timing decision.
Limitations and honest caveats
- The return is an assumption, not a forecast. Real market returns vary year to year; a calculator that compounds a smooth 10% cannot show the sequence-of-returns risk that a real portfolio experiences. Treat the output as a scenario, not a promise.
- Fees, taxes and inflation are excluded. Fund expense ratios, capital-gains taxes and inflation all reduce the real purchasing power of the final value. For long horizons, even 3% annual inflation halves purchasing power roughly every 24 years.
- Contributions are assumed constant. The calculator does not model step-up SIPs, skipped months or withdrawals. A 10%-per-year step-up on 500/month at 10% over 10 years would reach about 152,293 versus 103,276 for a flat contribution, but that requires steadily rising income.
- This is education, not financial advice. The calculator illustrates compounding; it does not recommend any product, fund or strategy.
Worked examples
500 per month, 10% return, 10 years
P = 500, r = 0.008333, n = 120. FV = 103,276.
Total invested 60,000, gains 43,276, projected value 103,276.
200 per month, 8% return, 20 years
P = 200, r = 0.006667, n = 240. FV = 118,589.
Total invested 48,000, gains 70,589, projected value 118,589 — notice how extra years nearly double the gains share.
500 per month, 10% return, 15 years
P = 500, r = 0.008333, n = 180. FV = 208,962.
Total invested 90,000, gains 118,962, projected value 208,962 — five extra years more than double the gains versus the 10-year example (43,276), while the invested amount rises only 50%.
500 per month, 10% return, 20 years
P = 500, r = 0.008333, n = 240. FV = 382,848.
Total invested 120,000, gains 262,848, projected value 382,848 — over 20 years the gains (262,848) are more than double the total invested, the hallmark of compounding at work.
Step-up SIP: 500 per month rising 10% per year, 10% return, 10 years
Start at 500/month and raise the contribution 10% each year (500, 550, 605, ...). The future value is computed month by month, compounding each instalment at r = 0.008333.
Projected value 152,293 versus 103,276 for a flat 500/month — roughly a 47% higher outcome from contributions that grew with rising income.
SIP at a glance
| Item | What to use |
|---|---|
| Monthly contribution | Any fixed amount you can sustain |
| Expected return | An assumption — test several scenarios |
| Period | Longer horizons magnify compounding |
| Compounding | Monthly in this calculator |
Frequently asked questions
What is a systematic investment plan (SIP)?
An SIP is a method of investing a fixed amount at regular intervals — usually monthly — into a mutual fund or other investment, instead of investing one large lump sum. It builds the habit of saving and spreads market timing risk across many months, which is why a sip calculator monthly investment planner is most useful when you model several return and horizon scenarios side by side.
How is the SIP maturity value calculated?
With the formula FV = P × [((1+r)^n − 1) ÷ r] × (1+r), where P is the monthly contribution, r is the monthly return (annual ÷ 12 ÷ 100) and n is the number of months. Gains equal FV minus total invested (P × n). The calculator above applies this formula with monthly compounding.
Is the projected return guaranteed?
No. The expected annual return is an assumption for illustration. Market-linked investments fluctuate; the calculator shows what a steady average return would produce, not what you will actually get. Fees, taxes and inflation are also excluded, so real-world results will differ.
Should I increase my monthly SIP amount over time?
Yes, if your income grows. Increasing the monthly amount early in the plan gives the extra money more years to compound, so it adds more to the final value than the same increase near the end. A 10%-per-year step-up on 500/month at 10% over 10 years reaches about 152,293 versus 103,276 for a flat contribution.
Which is better: SIP or lump sum?
Neither wins universally. A lump sum invested early compounds longer — 60,000 on day one at 10% for 10 years grows to about 155,625 versus 103,276 for a 500/month SIP — but an SIP avoids the risk of investing everything at a market peak and suits income earned monthly. Many investors use both.
Sources
- Investopedia — Systematic Investment Plan: definition, mechanics and dollar-cost averaging
- Investor.gov — Saving and investing basics from the U.S. SEC
- Investor.gov — Compound interest calculator and how compounding works
Key takeaways
- SIP growth follows FV = P × [((1+r)n − 1) ÷ r] × (1+r) with monthly compounding.
- Longer time horizons let compounding do most of the work — at 10%, gains overtake total invested after roughly 13 years.
- The return rate is an assumption — always test several scenarios (e.g. 8%, 10%, 12%).
- Early contribution increases beat late ones because of compounding time; step-ups are powerful when income rises.
- Run your own numbers in the sip calculator monthly investment planner above before committing to an amount.
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