ICICI SIP Calculator - Calculate Mutual Fund SIP Returns
Investors can invest in mutual funds through SIP route or lump sum route. Out of the two, the most popular and accessible option is SIP investing. This is because, in SIP, investors invest a certain amount every month for a period of time. SIP, coupled with long term investing, increases the probability of getting higher returns. Estimating SIP returns manually can be tedious. Hence investors can use ICICI SIP calculator to determine the potential returns from SIP investment.
ICICI SIP Calculator
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What is a Systematic Investment Plan SIP?
Systematic Investment Plan (SIP) is the most accessible and popular investing option available to the common man. In SIP investing, investors can invest small amounts of money regularly. It is the easiest way through which investors enter the stock market to get exposure to equities. SIP investing gives maximum benefits in the long term (5+ years).
With SIP investing, investors can benefit from financial discipline and rupee cost averaging. Since investors invest in mutual funds across market cycles, the average cost of investing reduces. In the long term, the lower cost will help in boosting the growth. This will help investors to accumulate a significant amount of wealth in the long term.
SIP not only helps in boosting returns but also helps fight market volatility. Since the investor is investing across market cycles, they will accumulate a greater number of units when the market falls, and a smaller number of units when markets rise. By doing so, the cost of investment decreases. And suppose in the long term, the market volatility is high. In that case, the lower cost will minimise the impact of volatility on the investment. The results of SIP investment will be better in the long term. Hence the longer one stays invested, the higher will be the probability of returns.
Investing in mutual funds with SIP is easy and flexible.
One can start a SIP investment with an amount as low as INR 500. The investors can start their SIP and forget about it as SIP investments are auto-debited from their bank account. Moreover, if the investors are low on cash for a couple of months, they can choose to pause their SIP and re-start it back whenever they want.
SIP investing has an excellent option where one can increase the amount of investment periodically. This option is called a step-up SIP. Step-up SIP will help investors to combat the effect of inflation on their investment portfolio. Using this, one can choose to increase their SIP investment by a certain amount or by a certain percentage every year. This will help investors to fulfil their financial goals as planned or even earlier without having to worry about inflation.
To calculate SIP returns manually, one has to estimate the cash flows and the dates on which the investment has been made. This can get super messy when the investment is spread out over a period of 60-100 months. Hence investors use the XIRR function in MS Excel to do the same. Alternatively, investors can use ICICI SIP calculator for the same.
What is an ICICI SIP Calculator?
ICICI SIP calculator helps in estimating mutual fund SIP returns. One can determine the potential SIP returns by inputting the data inputs such as investment amount, investment duration, mutual fund name, etc. On the basis of the inputs, the calculator computes the potential returns. It determines the wealth gained through the SIP mutual fund investments.
However, it is important to note that the SIP calculator doesn’t guarantee returns and is merely an estimation of potential returns. Also, the actual returns can vary depending on the mutual fund’s performance. The returns can be either lower or higher than the estimation as the actual returns are market-linked. One can calculate ICICI SIP returns using the calculator.
The ICICI SIP calculator computes the returns using compound interest and number of times the compounding is applicable. With the ICICI mutual fund SIP calculator, one can enter the monthly investment amount, investment duration (number of years) and expected return percentage from the SIP. The ICICI SIP calculator automatically computes the maturity amount and also the wealth gained from the SIP investment.
The SIP calculator requires the following inputs.
- Monthly SIP: The amount an investor wishes to invest every month in the mutual fund.
- Investment Period (in years): It is the investment tenure. Ideally, for all equity investments, longer investment durations, help in generating significant returns. Hence, it is advisable to have a longer investment tenure.
- Return (%): It is the expected rate of return from an investment.
- Step up (%): Stepping up mutual fund SIPs help individuals realise their goals faster. In other words, one can create the desired corpus faster if they can step up their SIPs every year. Ideally, it should be equal to the average annual pay hike, i.e. 10%.
With the given inputs, the calculator determines the following values:
- Total Investment: It is the sum of all the SIP investments until the end of the investment tenure.
- Wealth Gained: The total amount gained by the fund, during the investment tenure.
- Maturity Value: Maturity value is the total amount one can expect from their mutual fund investments. It is the value one can expect at the end of their investment tenure.
Also, the SIP Calculator provides a graphical representation (SIP Investment Chart) of the investments. The chart depicts a comparison between the maturity and total investment amount.
How to use an ICICI SIP Calculator?
Scripbox's ICICI SIP calculator is available online and is free to use. One can determine potential SBI SIP returns using the calculator. Firstly, one has to visit the Scripbox website to determine potential returns from SIP investments.
Scripbox’s ICICI SIP calculator has the following two approaches to calculate returns: monthly SIP and target amount approach.
Monthly SIP Approach
Scripbox’s ICICI SIP calculator has the following two approaches to calculate returns: monthly SIP and target amount approach.
- Monthly SIP investment amount or SIP Installment
- Investment period in years
- Expected return (%)
- Step up (%)
Let us understand the calculator with an example. Mr Ashwin would like to determine the potential returns from their SIP investments. The monthly investment amount he wishes to invest is INR 25,000 and for a tenure of 10 years. He expects a 13% return from the investment. Also, he plans to step up the investments by 10% every year.
The calculator estimates the following:
Wealth gained: INR 41,08,241
Maturity value: INR 88,89,341
Target Amount Approach
The target amount approach helps an individual to determine how much they have to invest per month to earn the target amount for their investment tenure. For this, one has to enter the following details:
- Set a target amount: The amount that one wishes to accumulate
- Investment period: The duration after which they want to earn the target amount
- Return (%): Expected rate of return from the investment
- Annual SIP investment step-up the percentage.
For example, Ms Nandini wants to accumulate INR 1.5 crore at the end of 15 years. Also, she expects a 12% return from her investment. Furthermore, she plans to step up the SIPs by 10% every year.
To achieve her target amount, Ms Nandini has to invest INR 17,273 per month. The SIP instalment amount for Ms Nandini is INR 17,273.
The total wealth gained is INR 84,15,007, and the total investment amount would be INR 65,84,993.
How can an ICICI SIP Calculator help you?
Following are the benefits of ICICI SIP calculator:
Ease of use
The ICICI Sip calculator is very easy to use. All one has to do is enter the SIP amount and estimated returns. The calculator will estimate the potential returns from the SIP investment. Additionally, one can also enter the target amount they want to achieve at the end of tenure. And the calculator will calculate how much the investor should invest monthly.
The calculator is very accurate when it comes to estimating the potential returns based on the inputs provided. However, one should know that it doesn’t guarantee any returns. It just provides an estimation of probable returns based on the inputs given.
The calculator returns results within a matter of seconds. This helps investors to save their time and effort to compute the returns from a SIP investment.
The calculator estimates the probable returns from an investment. It will help one to plan their finances and investments in a better way. By knowing how much investment can reap, an investor can make informed decisions.
Free to use
The SIP calculator is available online at Scripbox’s website and is free to use. Hence one can use it multiple times to compare different scenarios. Investors can also compare multiple SIP plans and make informed decisions.
SIP vs Lumpsum investment - How to choose?
An investor can either choose the SIP and lump sum route to invest in mutual funds. However, it is important to note that the investment process differs in both methods. For lump-sum investing, the investors invest the amount only once. On the other hand, for SIP investing, the investors invest small amounts in regular intervals during the investment tenure.
In lump sum investing, investors should have a substantial disposal amount and also a better understanding of risk. Whereas, in SIP investing, the investor can invest in small amounts and also doesn’t need to worry about timing the market or market volatility.
One can use a mutual fund returns calculator, to estimate their lump sum investment returns. On the other hand, one can use a mutual fund SIP calculator to estimate their SIP returns.
SIP or lump sum investment, one has to consider the following before investing:
- Availability of funds: An investor with a substantial amount of money can choose a lump sum route. However, if an investor has limited funds, they can invest only a small amount regularly. They can pick the SIP route.
- Understanding of risk: If an investor has a better understanding of market volatility and timing, then they can choose the lump sum route. Otherwise, they can choose the SIP route for investments.
Benefits of Investing in SIP
Though the above factors play a vital role in choosing the investment route. Also, SIP investing has certain advantages over lump sum route. Following are some of the benefits of SIP investing:
No need to time the market
One doesn’t need to time the market while investing through SIP. With SIP investments and long investment tenure, one can cover all the market cycles. This will eliminate the need to time the market and averages out the volatility.
Rupee cost averaging
As SIP investments invest across different market cycles, one can accumulate a higher number of units in a falling market scenario. On the other hand, a lesser number of units when the markets are going up. Ultimately, this helps the investors to reduce their average cost of investing.
SIP investing is a one-time process that requires just a mandate. One can start their SIP investments and forget about it. The SIP investments are linked to the investor’s bank account, and the money directly gets auto-debited from it. Furthermore, SIP inculcates financial discipline among investors.
Ideal for new investors
For new investors seeking equity exposure, mutual funds are the right way to start. Also, SIP is the best way to invest. It allows them to test the markets before actually starting full-fledged investments. Also, individuals starting their career can set aside small amounts every month to achieve their future goals through SIP.
Power of compounding
Investing and holding the investments for a long term will help in reducing the average cost of investing and also boosts the returns The combination of SIP and long term investing will help investors in accumulating significant wealth.
Best funds to invest through SIP
|Mirae Asset Tax Saver Fund (G)||ELSS - Tax saving|
|Motilal Oswal Long Term Equity Fund (G)||ELSS - Tax saving|
|Axis Bluechip Fund (G)||Large Cap|
|HDFC Top 100 Fund (G)||Large Cap|
|L&T Midcap Fund (G)||Mid Cap|
|Nippon India Growth Fund (G)||Mid Cap|
|Axis Small Cap Fund (G)||Small Cap|
|DSP Small Cap Fund (G)||Small Cap|
|Kotak Standard Multicap Fund (G)||Multi cap|
|Motilal Oswal Multicap 35 Fund (G)||Multi cap|
|HDFC Index Nifty 50 fund (G)||Index|
|UTI Nifty Index Fund (G)||Index|
Frequently Asked Questions
Which SIP is best in ICICI?
ICICI Prudential Asset Management Company is a well-known asset management firm in India. Furthermore, ICICI Mutual Fund is India's second-largest asset management company, with the majority of its products ranked as "AAAmfs." Their product offerings demonstrate a high level of trust and dependability. It aims to close the gap between saving and investing. Furthermore, the AMC has more than 68 mutual fund schemes and assets under management above INR 3,26,291 crores (as of 30th June 2020).
As ICICI offers multiple schemes with different investment objectives, the best funds vary from category to category. Shortlisting the best scheme for SIP requires an in-depth analysis and comparisons. At Scripbox, its proprietary algorithm shortlists best mutual funds on the basis of various parameters. Scripbox algorithm recommends around 2 to 4 funds for investment across different asset classes such as large-cap, diversified, liquid etc. When you invest in an objective, the algorithm suggests the appropriate asset class and funds.
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