A SIP or systematic investment plan helps you to make little investments in mutual funds at regular intervals of time to grow your money smartly. A SIP calculator is an online tool that helps you to determine the returns from SIP investment.
You can easily use your SIP calculator to see how much investment could grow if you invested in it today. Read more to know about the SIP calculator, it works, and many more.
What is a SIP calculator?
A SIP calculator is an online tool that calculates returns from your SIP investment. It works on inputs given by the user. You have to input the simple terms on it, like expected return rate, target amount, step-up rate, and tenure.
You can get the output from this SIP calculator in both chart and graphical form. The potential capital gains, maturity amount, and investment amount are shown clearly in it. This tool properly works on the target amount and investment amount approach.
Keep in your mind that it gives the idea of returns on your SIP investment, but it does not give you the guarantee of returns.
How does the SIP calculator work?
SIP calculators are used to calculating the potential returns by using the formula. It takes input values multiple times into account and gives you an idea of the returns that you get from SIP investment. However, the SIP calculator needs one to enter the monthly amount that you can invest, the investment duration till which you want to keep your investmentor the expected returns you want to get from the SIP investment.
The SIP calculator online calculates the maturity amount and wealth you gain from this investment. You only need to choose the target amount that matches your financial goals and reverse to calculate the monthly amount that you afford to invest for given tenure and growth rate.
Are SIP better than the FD?
The right choice between Fixed deposits and SIP depends on the investor’s solution, investor objective, understanding of the risk, or its acceptance rate.
There are various common grounds on which you can easily compare both investment options, with their returns, liquidity, risk, objective, investment, etc. For investors who want to invest in pre-determined and secured interest, then FD is a good option.
And if you are the type of investor that is ready to face market fluctuations, then the SIP is a good option for you. It is always suggested to compare both investment options and choose the best one that meets your investment goals.
Even the SIP and FD both investment options are good to invest in. But if you are only able to invest in anyone, then you should make the research online.
You have to know the features of both investment option and choose the best option that meets your goals and need. In the end, it is suggested to invest in SIP because there are chances to get a decent amount of returns from your investment.