SIP Planning: Why and How to use a SIP Calculator

In today’s day and age where there are financial gurus everywhere telling you to save and start investing. Most of them explain why you should start investing as soon as possible.. One of the better investment options is mutual funds to earn returns higher than FD interest.. There are many ways to invest in a mutual fund but the most preferable one is – SIP which means a Systematic Investment Plan. SIP helps you invest in mutual funds with smaller amounts at a regular interval of time. 

When you invest in an SIP, you are automatically benefiting from rupee cost averaging. What this means is that when you invest in a specific fund repeatedly for a period of time, you will be collecting units at different prices. These units are also known as net asset value (NAV). As an investor, you get even more units when the market is stooped down, this is when the fund’s NAV is lower. Similarly when the market is up, NAV gets higher. Consequently you get lesser units. As you keep investing periodically you will be investing in major market phases. Hence your average cost will be sensible.

 SIP helps investors to achieve investment discipline by paying monthly or quarterly.

Choosing the best SIP is not the only task to be done, as you will then have to decide how much investment you need to make each month to achieve your investment goals. You need a SIP planner for that. You can find them online on various websites. You can change your target amount based on your goals to see if the monthly SIP amount displayed fits your budget and meets your future financial goals.

Use a SIP calculator to estimate exactly how much you need to invest to achieve your goals, and how much benefit a step brings compared to regular swallowing. These calculators can be found on various websites online as well as mobile applications. You can even invest in mutual funds using such mutual funds apps. With this calculator, you can pay the amount for each sip and accumulate the desired amount in your time limit. This means that even if you know how big of a house you want to buy, or how many years you have left for such an event, this calculator can tell you the total amount needed and the amount you need to invest in your SIP each month to earn that total. If you live in India and have many years left before retirement, this retirement planning calculator tells you that you need to start saving and investing now to have peace in the golden sunset years. In fact, you will get a good idea of how to save and invest based on your projected annual return.

Based on the information provided by an investor, the calculator calculates the amount an investor receives from a SIP investment. Remember to research thoroughly before investing and that the values given by any SIP calculator are approximate and not accurate to the point due to the nature of and fluctuations in the market.

Happy investing!

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