Planning your investments wisely is important to achieve the financial goals you have set for your future. Investments in mutual funds can help you build a huge corpus over time, which can then be used towards achieving some major milestones of life – buying a house or even retiring comfortably! Furthermore, you can choose to invest in mutual funds through an SIP (systematic investment plan) and build wealth with small regular contributions and distributed risk.
But long-term wealth creation needs further careful planning,and this is where an SIP calculator can help. Learn four ways an SIP calculator can help you easily calculate and strategise your investments so that you can accumulate a huge corpus over time.
Calculates estimated returns
An SIP calculator provides an estimated return based on your investment amount and time frame. This gives you an idea of how much money should be in your account after the maturity period ends. With this data, you can craft your strategies for creating a huge corpus for goals like retirement, children’s education, or any other form of long-term investment.
This way, you can make smart financial planning and budgeting decisions and build a healthy mutual fund portfolio that could put you in a secure financial position.
Helps with goal setting
A good way to create a huge corpus is by setting realistic goals and having a plan in place to reach them. An SIP calculator can help with this since it shows you exactly how much money needs to be invested each month to reach that target amount within the desired time frame.
For example, if you would like to save 25 lakhs in 8 years, the SIP calculator will tell you how much you should set aside every month in order to accumulate that amount.
Aids in starting SIPs
The calculator makes it easy to understand different interest rates and tenures so that you can create strategies accordingly for each goal or objective separately without having to worry about confusion or miscalculations impacting your overall strategy.
Based on the results, you can even plan for multiple SIPs for different goals. This could include one SIP for children’s higher education and another one for retirement planning – to get the most out of them individually and maximise SIP investment returns over time.
- Helps in comparing different scenarios
With an SIP calculator, you can compare different scenarios and see how different investment amounts and tenures will affect your returns over the long term. For example, if you want to know whether investing Rs 5,000 monthly for 10 years or Rs 10,000 per month for 7 years will give you higher returns – simply input both numbers into the calculator and compare the results side by side. This way, you can invest in SIP plans in an informed and strategic way.
Similarly, you can get an accurate picture of how different strategies might perform in terms of returns and risk level before committing any funds to them. For example, if you are deciding between SIP investing in equities or bonds, the SIP calculator can help show which mutual fund scheme would be more profitable for you in the long run given current market conditions.
Maintaining a huge corpus requires diligent planning and foresight. However, you can make the process of building a corpus simpler by using an SIP calculator. By providing insights into how much your investments could grow over time, the tool helps you make better decisions about where to allocate your money for better returns. And, with a clearer understanding of your investment growth, you can determine which SIP plans will work best for you.
Thus, whether you are new to investing or have been managing your portfolio for years, using an SIP calculator is often recommended to facilitate strategic planning and achieve attractive returns in the long term.