Investing in mutual funds through the systematic investment plan (SIP) mode is convenient. In this mode, you can opt for monthly investments. This feature makes SIP attractive to young people who have recently started working. Through this investment mode, you can start with a small amount. However, as your income increases, so can your monthly SIP investment. This facility is called the step-up SIP.
What is stepup SIP?
With the help of step-up SIP, you can increase your monthly mutual fund investment amount at fixed periodic intervals. Gradually increasing your investment amount might help you enjoy higher returns you may have enjoyed if you did not opt for the top-up SIP facility. Hence, increasing your SIP investment amount regularly is a wise choice.
How does it work?
The step-up SIP facility works in two ways. They are:
The first way is annually increasing your investment amount by a fixed percentage. Let’s look at an example. You start your investment journey with a SIP investment of ₹3000. You want to raise your monthly investment amount annually by 10%. So, your investment amount after the top-up option is ₹3300 in the first year and the following year, it will increase by 10% throughout your investment tenure.
In this way, you can raise your monthly SIP amount by adding a fixed amount to your monthly mutual fund investment amount per year. For instance, you start investing at ₹5000 annually. You decide to increase your investment amount by ₹3000 every year. Hence, next year, your monthly investment amount will be ₹8000.
Regardless of the method chosen, you must know the step-up amount. An online increasing sip calculator can help you determine the top-up investment amount.
What are stepup SIP calculators?
A step-up SIP calculator can help you evaluate the potential returns on your monthly SIP investments. The SIP calculator with step-up computes the accumulated wealth at the end of your investment tenure. The SIP step-up calculator automatically considers the same step-up percentage every year and calculates the final SIP value of your investments.
How to use step up SIP calculator?
Step-up SIP calculators work on the following simple inputs:
- Monthly investment amount
- Growth rate expected
- Step-up percentage
What are the advantages of stepup SIP calculators?
The following are some benefits of using a SIP calculator with step-up:
- Easy to use
Online step-up SIP calculators are easy to operate. Just enter the required inputs such as the investment amount, investment duration, expected growth rate, and step-up percentage. The calculator will calculate the maturity amount after analysing the inputs.
- Estimate returns
You can use these calculators to ascertainthe potential returns on your monthly SIP investments. These online step-up SIP calculators can also help you take sound mutual fund investment decisions. You can compare the returns using these calculators, which help you make informed decisions.
Computing step-up investment returns can take time apart from confusing. That’s where online calculators step in. These calculators will provide the results in seconds, saving time and energy. They are free to use regardless of the number of times you use it.
There are numerous other benefits of using an online step-up SIP Calculator. They have an enormous impact on your future financial health. So, what are you waiting for? Start your investment journey by using these calculators.