Step Up SIP Calculator

Step-up SIP can be defined as type of systematic investment where the investment amount increases with time. Compared to standard SIPs, a Step Up SIP is an attractive variant which allows one to increase the investment amount with time usually in line with an increase in income.

What an SIP is and how it works is pretty straightforward - you invest a fixed amount of money on a regular basis till a specified end-date. Step Up SIP allows you to increase the investment amount as per your preferred timing and top-up on the initial investment amount. Now, let’s understand what is a Step-Up SIP Calculator is in the following section

Step Up SIP Calculator is a free online tool that can help investors determine the estimated returns based on a specific growth rate of the SIP investment with time. What’s more, this calculator also immediately shows the difference in corpus between a step-up SIP and a standard SIP. One can use this calculator multiple times and in different combinations to determine the investment amount and the step-up amount that will be required to reach the desired financial goal.

A Step-Up SIP calculator uses 4 factors - the monthly investment amount, the annual increase or step up expressed as a percentage value, time period of the investment and expected rate of return on the investment. All these fields can be filled in by the user. Once these 4 fields have been input, the calculator immediately shows the corpus created by the step-up SIP as well as the difference in corpus versus a standard SIP with the same starting investment amount

So, using this tool, you can gauge the increment you’d like to make in your investment amount and the corresponding incremental returns on the basis of your investment ability. The Step-up SIP calculator, is in fact just a variation of the popular SIP calculator and you can use it if you are interested in increasing your investment amount of your SIP over the investment tenure.

In order to use the Step-up SIP Calculator, you need to enter 4 key details into the calculator:

1. 1. Monthly Investment – This is the amount you plan to invest every month

 

2. 2. Annual Step-up % - This is the percentage by which you plan to increase your investment every year.

 

3. 3. Expected Return Rate % - This is the return you expect from your investment.

 

4. 4. Investment Period – This is the period of time for which you plan to make your investment.

Once you have made your inputs, the Step-up SIP calculator automatically provides the below output:

 

• 1. Total Investment Amount – This is the total amount invested with step-up and without step-up

 

• 2. Returns Earned – These are the returns earned from the investment with step-up and without step-up

 

• 3. Amount – This is the total value of your investment at the end of the investment tenure with a standard SIP and a Step-Up SIP.

 

• 4. Extra Corpus Created – This is the difference between returns of a Step-up SIP vs standard SIP based on the input provided by the user.

One should keep in mind that the output provided by the Step-up SIP calculator is based on user inputs so, the output is liable to change whenever the user changes any of the input fields. So, the output generated are just estimates and there is no guarantee that the output data will match a real-life investment scenario.

Key Benefits of using a step-up SIP calculator include:

1. 1. Increases financial awareness regarding both SIP and step-up SIP investment

1. 2. Helps in informed decision-making with respect to investments

1. 3. Aids investors in setting achievable and realistic investment goals

1. 4. Provides a basis of comparison between two popular long-term investment strategies

1. 5. Eliminates the need to carry out tedious error-prone calculations by providing immediate results

1. 6. Saves time on the part of prospective investors seeking to figure out how much they can invest

1. 7. In view of these benefits, it is definitely a good idea to use this free online tool to aid your long-term investment decision.

Now that we’ve understood all about the SIP calculator as well as the Step Up SIP Calculator, it’s time we dig deeper into the types of SIP so that we can choose what suits us best and then use a fitting SIP calculator for predicting future SIP returns.

The following are the different types of SIP available for investors to choose from: