Ways in Which An SIP Calculator Can Help Investors Make Smart Investments

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₹100 per month, and do so over a horizon that aligns with your goals. However, for your investments to be fruitful, you must ensure the amount you accumulate meets your financial objectives.  You can do this by optimising your investments with the help of an SIP calculator.

But what is an SIP calculator? Simply put, it is a digital tool that provides an estimate of your maturity amount based on your investment terms. Read on to know how it works, and how it can help you invest smartly.  An SIP calculator is an online tool that estimates your earnings based on the investment amount, frequency, and expected interest rate.

It works based on a formula and requires no manual calculations from your end.  The formula used is:  FV = P x {[(1 + r) n – 1] ÷ r} x (1 + r) Here, To use the calculator, all you need is the SIP amount, the number of instalments you wish to make, and the expected interest rate.  You can use the calculator offered by any aggregator or mutual fund issuer of your choice to determine these results. Keep in mind that mutual funds are linked to the market and are volatile in nature.

So, your earnings aren’t guaranteed at any stage.   The amount you plan to invest and the investment’s duration play a significant role in determining the final earnings. As such, these are some of the factors you must consider to align the investment with the returns you anticipate.  Since an SIP calculator takes these factors into account, you can use it to understand your returns for different investment amounts and tenors.