What this calculator does
A mutual fund returns calculator projects the future value of a mutual fund investment from three inputs: how much you invest, the return rate you expect, and how long you stay invested. This tool merges what used to be two separate calculators, one for a monthly systematic investment plan (SIP) and one for a lump-sum mutual fund investment, because the underlying maths was identical. Pick the mode that matches how you actually invest.
How the calculation works
Both modes compound monthly, using your annual return divided by 12 as the monthly rate. In lump sum mode the whole amount is invested once:
Maturity value = Amount × (1 + monthly rate)^(months)
In monthly (SIP) mode, each contribution is treated as made at the start of its month, so it earns a full month of growth before the period ends. This is known as an annuity due:
Maturity value = Contribution × [((1 + monthly rate)^months − 1) / monthly rate] × (1 + monthly rate)
The "invested" figure is simply the sum of what you put in; "returns" is the difference between that and the maturity value.
Worked examples
- Monthly SIP: $500 a month at an 8% expected annual return for 15 years invests $90,000 and grows to roughly $174,173. That is about $84,173 in returns.
- Lump sum: a single $10,000 investment at the same 8% for 15 years grows to roughly $33,069.
What affects your actual return
The projection is only as good as the assumed rate. In practice, returns move with:
- Market volatility. Fluctuations in the market change the value of the underlying holdings.
- The fund manager's decisions. For an actively managed fund, skill and strategy influence performance.
- The fund's expense ratio. Ongoing fees are deducted from returns before you ever see them.
- Your investment horizon. A longer horizon gives compounding more time to work, which is why the chart above gets steeper, not flatter, over time.
Short-term versus long-term returns
Returns on an investment held for less than a year are usually described as short-term; those on an investment held longer than a year are long-term. The two are typically taxed differently, so it's worth knowing which bucket your holding period falls into before you rely on this projection for planning.
Frequently asked questions
What is the difference between the "Monthly (SIP)" and "Lump sum" modes?
Monthly mode assumes you invest the same amount every month for the chosen period. That is a systematic investment plan, or SIP. Lump sum mode assumes you invest the whole amount once, at the start, and let it compound. Both modes use the same monthly-compounding maths; only the contribution pattern differs.
What annual return rate should I use?
There is no single right answer. Base it on the fund's own historical performance or on your own research. No one can guarantee future returns, so it's worth trying a few different rates to see how sensitive the projection is.
Does this include fund fees or taxes?
No. This is a pre-fee, pre-tax growth projection. A fund's expense ratio and any capital-gains tax on withdrawal will reduce the amount you actually take home, so treat the maturity value as an upper bound.
What currency does this calculator use?
US dollars, which is this site's default. The compounding maths is the same regardless of currency, so you can read every figure as your own currency's units if you're investing elsewhere. The income tax refund calculator on this site is the one exception. It works in rupees, because that engine is India-specific.
Is this the same as the old SIP returns calculator?
Yes. The SIP-returns and mutual-fund-returns calculators on this site used identical compounding maths, so they have been merged into this one tool with a mode toggle. A link from the old SIP calculator URL redirects here.