Investment Return Calculator — SIP & Lump Sum

The calculator uses the standard time-value-of-money identities every textbook and mutual-fund factsheet uses, with monthly compounding throughout — that matches how SIP installments are debited and how unit-trust NAVs are updated.

Two formulas, one shared cadence:

• Lump-sum future value — FV = P × (1 + i)N, where i = r / 12 and N = years × 12. Each month, the existing balance earns i in interest, which is reinvested.
• SIP future value (annuity due) — FV = PMT × ((1 + i)N − 1) / i × (1 + i). The trailing (1 + i) reflects that each installment is credited at the start of the month, so it gets one extra month of compounding. Drop the factor for the textbook ordinary-annuity form.
• Step-up SIP — when the monthly amount rises each year by a step-up rate s, the closed form no longer applies (the contribution is no longer constant). The calculator walks every month explicitly: month m uses PMT × (1 + s)year(m) − 1 as that month's installment, adds it to the running balance, and compounds at i. This is the same logic any spreadsheet model would implement, just packaged.
• Inflation adjustment— the real (today's-money) future value is FV / (1 + π)years, where π is the annual inflation rate. The nominal number is what you will hold; the real number is what it will buy.
• Annualised return — for the comparison summary, the calculator reports (FV / invested)1 / years − 1. For lump-sum, that equals the CAGR of your money. For SIP, it is a money-weighted approximation rather than a true XIRR; in practice the difference is small at long horizons.

Every result is cross-checked by an independent month-by-month simulation: build the balance up one period at a time and compare it to the closed-form FV. The badge in the calculator card lights up when both agree to within rounding error — for SIP without step-up and for lump sum, that holds for every valid input. Where the closed-form is not applicable (step-up SIP), the simulation is the source of truth and the badge reflects that.

The math is currency-agnostic. Pick LKR, INR, USD, GBP, EUR, AUD, CAD, AED, SGD, or JPY from the dropdown — only the display formatter changes. Returns are expected, not guaranteed; market outcomes will diverge from any single assumed rate. SEBI and similar regulators require this caveat for a reason.

• AMFI — Systematic Investment Plan (SIP) explainer
• U.S. SEC, Investor.gov — Compound Interest Calculator and formula
• SEBI — Investor Education portal (returns are expected, not guaranteed)
• Central Bank of Sri Lanka — Economic indicators & published interest rates
• Federal Reserve / CFPB — Regulation DD Appendix A (APY definition)

Formulas and conventions were last cross-checked on 2026-05-11. Page is reviewed whenever a regulator updates the underlying disclosure rules or when a substantial source change is logged.