What is SBI Mutual Fund SIP Calculator

SBI SIP Calculator is an online tool that helps in estimating the returns from a SIP investment. The SIP calculator works on the inputs provided, which include investment amount or target amount, expected rate of return, investment tenure. The SBI SIP Calculator works on the investment amount and target amount approach. The investment amount is the most used among the two approaches. In this, an investor enters how much they wish to invest and the tenure, expected rate of interest and step up percentage. Conversely, the target amount approach estimates the current investment amount every month based on the target provided by an investor.

How can SBI Mutual Fund SIP Return Calculator Help You?

SBI Mutual Fund SIP calculator can help you in the following ways:

• It provides a reasonably accurate estimate of the SIP returns. Mutual funds are subject to market risks, so the actual result may vary slightly.
• SIP calculations are quite complicated to solve manually. Although an investor may be  familiar with the formula, it can be quite a time-consuming exercise. The calculator can aid an investor to get accurate results in a short span. While being easy-to-use, you are assured of prudent financial planning.

How does the SBI Mutual Fund SIP Return Calculator Work?

The SBI SIP calculator uses a formula on the values provided by users to calculate SIP returns. These values are the investment horizon, expected rate of return and the invested amount. As a result, the calculator displayed the final amount an investor will have at the end of tenure. 

Formula to Calculate SBI SIP Returns with an example

A global standardisation method is used to calculate SBI Bank SIP to determine the total returns an investor has incurred. The SBI Bank SIP formula is as follows:

FV = [P x r x (1 + i)^ n – 1]/i} x (1 + i)

In which, 

• FV=Future value
• P=SIP amount
• I=Compounded rate of return
• r=Expected rate on return
• n=Number of instalments that is, Investment duration x frequency that is, monthly/quarterly/half-yearly

Example for SBI SIP Calculator

Let’s assume an investor invests Rs 10,000 per month in a scheme for a duration of five years. Based on the parameter provided, the XIRR or SIP return for the investment is 28.21% per annum.

The SBI SIP calculator provides the following results:

Similarly the maturity values for various time periods are as below (with Rs 10,000 as the monthly investment amount):

How to use SBI SIP Return Calculator?

The SIP return calculator SBI considers the following user inputs:

• The investment amount
• The investment tenure
• The expected return

With these inputs, the calculator computes the SBI mutual fund scheme's historical returns. Additionally, it also highlights the maturity value over that period and the related gains.

Here are a few steps to use the SBI SIP return calculator:

• Step 1: Choose between SIP or lump sum 
• Step 2: Calculate the amount you plan to invest in a month
• Step 3: Enter the expected rate of return (per annum
• Step 4: Determine the time period of your investment

So, based on the historical returns of a scheme, the SIP amount, and the investment term, the calculator displays the investment maturity value. The tool also provides you with relevant information such as the fund’s age, assets under management (AUM), expense ratio, etc., thus helping you make an informed decision. 

Benefits of Using SBI SIP Calculator

The benefits of the SBI SIP calculator are as follows:

• Estimate maturity amount: Investors can estimate their potential returns at the end of the investment duration. It is possible to estimate the total value one will receive at the end of the tenure. Assessing the monthly investment amount is easy in case the investor knows how much maturity amount they want to earn at the end of their investment tenure.
• Easy-to-use online tool: An investor has to enter a few key variables such as investment amount or maturity amount, expected return, investment tenure, and step-up percentage to estimate their returns or monthly investment amount. Also, the SBI SIP calculator computes complex calculations in a short span. It estimates the maturity amount and the monthly investment amount in a few seconds.
• Graphical and tabular representation: The return estimates are displayed both in graphical and tabular formats. This way, an investor can easily interpret the returns, and investment amounts and initiate an informed investment decision-making process.
• Maturity amount based on growth scenarios: It estimates the returns based on three growth scenarios: above-average, average returns, and below-average returns. An investor can select the scenario depending on their investment necessities before they start investing.