A systematic investment plan, or a SIP, is a popular investment choice for small investors just testing the waters of mutual fund investment. It is also good for those who are just starting their investment journeys, and for those who wish to invest small sums of money at regular intervals. A SIP return calculator helps to estimate returns from a particular SIP, and to know amounts to invest in the first place.

A SIP and the SIP Return Calculator

It is important for investors to know how SIPs work in order to grasp how a SIP calculator can help to invest in a SIP to build wealth. As a first step to invest, say in stocks, you may open a demat account, and then try to find out about a company stock you wish to invest in. The aim of any investor before investing is to attempt to discover what returns they can possibly get out of  investments. Since the prospects of a company’s performance can possibly tell you how good a company stock is, you would likely pick some top companies to invest in.

A SIP is a channel for an investor to invest in mutual funds. The difference between a SIP and a regular mutual fund is the way the investment is made. In a regular mutual fund, an investor invests a lump sum (a large one-time investment) initially in a mutual fund. Via a SIP, an investor can invest in installments with small sums - say, once in a month, for a fixed period, like five years. A SIP goal calculator, or a calculator that gives you an estimate of your returns from a SIP, is an online tool that effectively helps you to plan your investment, depending on your frequency of investments, the returns you seek and your tenure of investment. This helps you to fulfil your financial objectives with a plan of action.

The Meaning of a SIP Return Calculator

Whether you wish to invest in any upcoming IPO, or stocks, or a SIP, every tool is available to you online these days. Tools are created for the convenience of investors and primarily aid in encouraging investment with informed decisions. A SIP return calculator is used to estimate the returns that an investor can get from a SIP investment. The calculator functions according to inputs that are provided by users. On any financial platform, you can use such a tool, and enter fields with the following information:

• Your monthly investment amount
• Your tenure of investment
• Your rate of returns (predicted rate of growth)

You would know your investment amounts and your tenure for sure. The growth rate may not be known to you, but you can obtain this data from the past performance of the mutual fund you are considering. Based on this, you can easily have a rough idea of your returns from a SIP.

How a SIP Return Calculator Grows Wealth

The very use of a SIP goal calculator can help you build your wealth once you know how much you can invest to meet your financial goals. The calculator also helps you to know how you can step up your SIP investment (add more capital to your initial investment) to get more returns. In this way, SIPs and calculator use aid you in building a corpus for any requirement of life.

Invest Today

The choice of investments out there are plenty and there are some to suit distinct requirements and goals. For instance, you can open a demat account if you wish to invest in long-term stocks, and even subscribe to an upcoming IPOif you think a company’s prospects look positive. Furthermore, you can try a SIP if you want to start out small and delve into more or less secure mutual fund investment.