ICICI SIP Calculator
Our ICICI SIP calculator is a great tool that comes in handy to get a fair estimation of the investment returns before you invest or during the period of your investment in mutual funds. Hence, it acts as a road map for you to achieve your several financial goals. The calculator helps you complete complex financial calculations quickly.
SIPs (Systematic Investment Plans) are a popular way to invest in mutual funds. Small contributions from individuals help manage their finances via disciplined investing. When you start an SIP, a fixed amount is invested monthly, quarterly, or annually based on your choice. SIPs are helpful if you wish to shield your investments from short-term volatility in the market.
How Does Our ICICI SIP Calculator Work?
Our SIP calculator uses the below formula to calculate the future value of your investments:
where:
FV is the future value of your investment
P is the monthly investment amount
r is the monthly interest rate divided by 12
n is the total number of months or the investment duration
Example:
Let's say you are planning to invest ₹4,000 every month through SIP. You are expecting a rate of return of 10% and want to stay invested for 12 years. Now, let's calculate the future value of the SIP based on the above formula.
In the first step, we will convert the annual rate of return to a monthly rate: r = 0.10/12 = 0.00833
The next step is to calculate the total number of months: n = 12 x 12 = 144
FV = 4,000 x ((1 + 0.00833^144) - 1) / 0.00833
FV = 4,000 (2.30207) / 0.00833
FV = ₹11,05,436 (approximately)
How Should You Use The ICICI SIP Calculator?
Using the ICICI SIP calculator is very simple. The calculator has an easy user interface that anyone can use to determine their investment returns. Follow the below-mentioned steps to use the SIP calculator.
- Enter the SIP contribution you would like to make every month.
- Set the expected return rate at which you would expect your mutual fund investments to reap returns.
- The final step is to set your tenure of investment
Once the necessary details have been entered into the calculator, you will get accurate results in a matter of seconds.
Example:
Ms. Helen wishes to invest ₹6,000 in a monthly SIP. He expects a return rate of 8% and wants to stay invested for 5 years.
When we use the above formula, we can easily calculate the future value of Helen’s investments.
Converting the annual rate of return to a monthly rate: r = 0.08/12 = 0.00667
Calculating the total number of months: n = 5 x 12 = 60
Putting the above values in the formula, this is what we get:
FV = 6,000 x ((1 + 0.00667^60) - 1) / 0.00667
FV = 6000 (0.49014) / 0.00667
FV = ₹4,40,905 (approximately)
Benefits Of Using The ICICI SIP Calculator
The ICICI SIP calculator helps you learn how much the future value of your investments will be. The calculator also provides you with several other benefits such as:
- The calculator helps you determine a suitable contribution amount so that you can see whether it is within your budget.
- The SIP calculator helps you understand the impact of various holding periods on the returns you will reap and make a suitable choice.
- The calculator gives you a chance to analyze the value a particular mutual fund holds and make informed investment decisions.