A SIP or Systematic Investment Plan allows investing in small amounts in mutual funds instead of lump sums. Investing in mutual funds through SIP has many benefits.
You can not only invest affordably without having to time the market but also build a corpus over time in a flexible manner. You can invest as much as you like to maximise gains, but it is important to know how much you should invest, or it is easy to go beyond your limit and jeopardise your financial goals.
This is where SIP calculators prove to be useful. Let us understand whether these calculators really help plan your financial goals when working with a systematic investment plan.
What is a SIP Calculator?
A mutual fund SIP calculator is an online tool that estimates the value your SIP investments generate over time based on an assumed return rate.
It considers factors like the term, SIP value and rate of return to give you a picture of the future value of your investment.
Though the exact returns depend on the market, a SIP returns calculator provides the closest estimate of the investment value and helps you manage your money.
Benefits of a SIP Calculator
A monthly SIP calculator can simplify your investment to a great extent. Here are the most important benefits of using this calculator:
- Accuracy – With an online SIP calculator, you can expect an accurate estimate of your corpus because these tools have virtually no margin of error. You can use it to compare results for different tenures while keeping the returns the same.
- Speed – SIP calculators are designed to give instant results. There is no need to wait for corpus calculation; simply hit a button, and you get the answer in seconds.
- Free to Use – Most online monthly SIP calculator tools are available for free use. You don’t need to pay any amount to use them, and it lets you make any number of calculations.
- Helps Compare SIPs – A goal SIP calculator lets you enter returns of different schemes, check the corpus for each of them and choose the one that best suits your objectives. This way, the tool helps maximise your investment profitability.
- Easy to Use – Using a physical calculator to compute your returns can demand many complex calculations and hours from your day. On the other hand, an online calculator can do this for you in a few minutes. Moreover, you can use the SIP calculator on your laptop, tablet, or smartphone to plan your investment from anywhere. You simply need to input the information, and the algorithm calculates the results instantly.
- Beneficial for New Investors – Though every investor can use the calculator, it is particularly useful for those who are investing for the first time and don’t understand where to start and what to expect. A SIP calculator can explain how much you should invest and how long it takes to reach your goal.
- Helps Plan Financial Goals – When you invest in SIPs, you must check how much you should invest to get the desired corpus. SIP calculators help accomplish this easily. You can enter the tenure, amount and expected returns to get an idea of the corpus the investment accumulates over time. You can adjust the tenure and amount to match your goals and make informed decisions.
- In a Nutshell
A SIP interest calculator proves to be a handy tool for investors as it helps simplify investments and plan wisely for the future. With an accurate estimation of your investment’s future value, PGIM's SIP calculator proves to be useful for determining your financial goals.
