SIP Calculator
Calculate how much wealth your monthly SIP creates β with rupee-cost averaging, compounding, and India's 2026 LTCG tax impact built in.
How SIP Actually Creates Wealth β The Two Engines
A SIP doesn't simply accumulate money; it compounds in two directions simultaneously:
- Rupee-cost averaging: you buy more units when markets fall (NAV is low) and fewer when markets rise. Over 10+ years, this lowers your average acquisition cost below the average NAV β a purely mathematical advantage unavailable to lump-sum investors who time incorrectly.
- Compounding: returns earned generate their own returns. The βΉ10,000 SIP that earns 12% annually doesn't just grow by the same βΉ1,200 each year β the base expands, so year 20 earnings dwarf year 1 earnings in absolute rupees.
These two forces explain why βΉ10,000/month at 12% for 30 years creates nearly βΉ3.5 crore on just βΉ36 lakh invested.
India's Mutual Fund Landscape in 2026 β The Right Benchmarks
India's mutual fund AUM crossed βΉ70 lakh crore in 2026, with over 10 crore SIP accounts active. Monthly SIP inflows consistently cross βΉ25,000 crore. Historical category returns (15-year CAGR, as a planning guide):
| Category | 15-Year CAGR (approx) | Risk Level |
|---|---|---|
| Large Cap Index Fund | 11β12% | Low-Medium |
| Large Cap Active | 12β13% | Medium |
| Multi-cap / Flexi Cap | 13β15% | Medium |
| Mid Cap | 15β17% | High |
| Small Cap | 16β18% | Very High |
| Debt / Liquid | 6β7.5% | Low |
These are historical guides, not guarantees. Always use 10β12% for planning equity SIPs β being conservative means you're pleasantly surprised, not financially short.
Budget 2024 Tax Changes β What SIP Investors Must Know
- LTCG (held > 1 year, equity): 12.5% on gains above βΉ1.25 lakh/year (raised from 10% + βΉ1L limit in Budget 2024)
- STCG (held < 1 year, equity): 20% flat (was 15%)
- Debt funds: taxed at slab rate, no indexation (since Budget 2023)
- Tax-harvest opportunity: each March, redeem up to βΉ1.25 lakh of long-term gains and immediately reinvest β legally resets cost basis, saves thousands annually
XIRR vs CAGR β Know Which Number to Trust
For SIP returns, CAGR is wrong. CAGR assumes one lump-sum investment; SIP has 120+ separate investments over 10 years, each with a different time horizon. XIRR (Extended Internal Rate of Return) treats each instalment independently and gives the accurate annualised return on your actual cash flows. If a fund fact-sheet shows "SIP returns," it should be XIRR. This calculator uses the standard SIP future value formula for planning; for tracking actual returns use the XIRR function in Excel or your AMC's app.