Step Up SIP Calculator
It often gets challenging to compute returns from a Step-up SIP. Calculating the investment amount every time and estimating the returns manually can be a time-consuming task. With the help of a step-up calculator, you will be able to estimate the potential returns from your SIP investments. Furthermore, the calculator lets you set a desired step-up percentage for estimating returns. This article explains what a Step-up SIP Calculator is and how to use Scripbox’s Step-up SIP calculator.
What is a Step-Up SIP Calculator?
A systematic investment plan (SIP) helps you invest a fixed amount every month in a mutual fund scheme. The disciplined way of investing helps you average out the market volatility and helps in rupee cost averaging. Furthermore, you have an option to step up your investments on an annual basis. Stepping up refers to increasing the value of your SIP amount by a certain percentage every year. It becomes difficult to track the investment amount after certain years. The entire process of estimating potential returns will get mind-boggling. A step-up calculator helps you estimate the returns when you opt for a step-up SIP.
Therefore, a Step-up SIP calculator helps you estimate the potential returns from your SIP investments. Within seconds, the calculator computes the value of your investment at the end of the investment tenure. The calculator automatically factors in the same step-up percentage every year and computes the SIP value for the investment duration.
How To Use Step-Up SIP Calculator?
Scipbox’s Step-up Calculator is a free online tool that will help you estimate the returns from your step-up SIP investments. It is a fairly simple calculator that works on the following inputs:
- Monthly Investment Amount: This is the monthly SIP amount you wish to invest in a mutual fund every month.
- Expected Growth Rate: This is the return percentage you expect from your mutual fund investments.
- Investment Duration: The tenure for which you will invest in the mutual fund scheme.
- Step-Up: It is the percentage increase in the value of your SIP investment each year for the entire duration of the investment tenure.
For example, if you set a step-up as 10%, this means that your SIP amount will increase by 10% every year during your investment tenure. Simply put, if your monthly investment amount (SIP) is INR 10,000, in the second year, the SIP amount will be INR 11,000 (10,000 + (10%*10,000)). In the third year, the SIP amount will be INR 12,100 (11,000 + (10%*11,000)).
Following are the Outputs:
- Total Investment Amount: A sum of all your SIP amounts during the investment tenure.
- Potential Capital Gains: Potential returns from your SIP investments.
- Maturity Amount: The total amount you can expect from your investments at the end of the investment duration.
Furthermore, Scripbox’s SIP Step-Up Calculator gives three potential maturity amounts based on different growth scenarios. The growth scenarios are above-average returns, average returns, and below-average returns.
Moreover, you can also see a graphical representation of your investment growth during your investment tenure.
Let’s understand the Step-up SIP calculator with an example. Ms Meghana wishes to invest INR 10,000 in a mutual fund every month. Her investment duration is ten years. Furthermore, she wishes to step up her investments by 20% every year. Also, she expects a growth rate of 10% from her investments.
At the end of her investment tenure, her maturity value is INR 46,33,591. The total investment value is INR 31,15,042, and the potential capital gains are INR 15,18,549.
SIP Calculation with Annual Step Up
|SIP per Month||Annual Investment||Total Investment|
|Rs. 10,000||Rs. 1,20,000||Rs. 1,20,000|
|Rs. 11,000||Rs. 1,32,000||Rs. 2,52,000|
|Rs. 12,100||Rs. 1,45,200||Rs. 3,97,200|
|Rs. 13,310||Rs. 1,59,720||Rs. 5,56,920|
|Rs. 14,641||Rs. 1,75,692||Rs. 7,32,612|
|Rs. 16,105||Rs. 1,93,261||Rs. 9,25,873|
|Rs. 17,715||Rs. 2,12,587||Rs. 11,38,460|
|Rs. 19,487||Rs. 2,33,846||Rs. 13,72,306|
|Rs. 21,435||Rs. 2,57,230||Rs. 16,29,536|
|Rs. 23,579||Rs. 2,82,953||Rs. 19,12,489|
Benefits of Using Step-Up SIP Calculator
Following are the benefits of using the Step-up SIP Calculator:
- Estimate Returns: You can estimate the potential returns from your SIP investments. Furthermore, before investing in a scheme, you can compare the returns and make a well-informed decision.
- Saves Time: Computing SIP (step-up) returns can be confusing and time-consuming. The calculator will compute the results in seconds. Therefore, saving you time and energy from the complex calculations. The calculator is free to use, and you can use it multiple times to test various scenarios.
- Easy to Use: The Step-up SIP calculator is very easy to use. You just have to provide inputs such as monthly investment amount, expected growth rate, investment duration, and step-up percentage. Based on the inputs, the calculator computes the maturity amount.
- Step-Up Percentage: The calculator has a feature to adjust the step-up percentage. As a result, you can estimate the results for varying step-up percentages and choose a suitable option as per your investment needs.