Step-up SIP calculator

A SIP (systematic investment plan) puts a fixed sum into a fund every month. In a step-up SIP the sum is raised once a year by a set percentage. With a 10% step-up, a ₹10,000 instalment becomes ₹11,000 in the second year and ₹12,100 in the third.

The page takes four inputs: the first monthly instalment (₹500 to ₹5,00,000), the yearly raise (0% to 50%), the expected return a year (1% to 30%) and the period (1 to 40 years). Setting the raise to 0% gives an ordinary SIP.

There is no single short formula, because the instalment changes every year. The calculation takes each instalment, adds it at the start of its month, and grows it at one-twelfth of the yearly return for every month until the end, compounded monthly. The final value is the sum of all those grown instalments. Invested is the sum of the instalments paid. Gains is the value at the end minus the amount invested.

Worked example: ₹10,000 a month, a 10% yearly raise, 12% expected return, 10 years. The tenth-year instalment is ₹10,000 × 1.1 nine times over, about ₹23,579. The amount invested is ₹19,12,491 and the value at the end ₹33,74,326, so gains are ₹14,61,835. The same ₹10,000 kept flat for 10 years gives ₹23,23,391 on ₹12,00,000 invested.

Without the step-up is the starting instalment kept unchanged for the whole period at the same return. The gap between the two figures is what the yearly raise adds. Because later instalments are larger but have less time to grow, a raise adds more over a longer period, and most of the extra value comes from the extra money put in.

The return is treated as steady every year. Real fund returns vary from year to year, so the actual value at the end can differ widely from the figure shown. The result is not a forecast for any fund. Fund charges, taxes on gains, inflation and missed instalments are not modelled. Other calculators can give different results for the same inputs, because compounding and timing assumptions differ.