Hailed one of the best investment instruments, mutual funds have grown in popularity among investors. A number of mutual fund schemes keep on launching every year, allowing investors to explore different market sectors and capitalize on their return offering potential. As of January 2022, there are around 44 fund houses in India offering over 2,500 different mutual fund schemes to investors. You can also invest in savings in mutual funds and allow it to grow in the long term.
With the availability of such a number of mutual funds in the market, it often becomes difficult to choose the right ones. There comes the role of a mutual fund calculator that enables you to compare different mutual fund schemes and pick up the best plans for your portfolio.
What is Mutual Fund Calculator?
A mutual fund return calculator helps you to gauge returns from your mutual fund investments. You can estimate returns from different mutual fund schemes based on your investment and choose the right fund to invest in. Now, based on the type of investment, the mutual fund calculator is of two types- Lump sum calculator and SIP calculator. Let us learn about the two in detail.
Lump sum calculator
Lump sum investment is a mode of investment where you invest a lump sum amount at once in a mutual fund. You will earn returns based on the fund’s performance and the same will keep on compounding over the years until you redeem the investment. A lumpsum MF calculator helps you to estimate the returns from your lumpsum investments.
How Does Lumpsum MF Return Calculator Works?
A lumpsum mutual fund calculator India works using the compound interest formula. You have to enter the following details and the calculator will show you the estimate of returns from your investment:
- Total investment: The lumpsum investment that you will make in the mutual fund scheme
- Expected rate of return (p.a): The annual rate of return you are expecting from the mutual fund
- Time period: How long you are going to remain invested in the fund
Based on the given inputs, the calculator will show you the total investment amount, estimated returns, and final value of your investment.
Let us understand this with an example- Suppose you want to invest Rs 10,00,000 for 10 years in a mutual fund from which you expect around 12% mutual fund interest rate annually. The returns that you can expect is Rs 21,05,848, and the final value of your investment will be Rs 31,05,848.
Another way to invest in mutual funds is through SIP. A Systematic Investment Plan or SIP is a way of investing periodically in mutual funds. It helps individuals who do not have enough money to make a lump sum investment. You can start SIP in any mutual fund and keep investing a fixed amount of money every month, quarter or year. The enables you to invest your monthly savings and use the power of compounding in mutual funds to build a huge corpus in the long term. You can use the SIP mutual fund returns calculator to gauge returns from your SIP investments.
How Does SIP Calculator Works?
To use the SIP mutual funds returns calculator, you have to enter the following details:
- Monthly investment: The amount of money you are going to invest every month in the mutual fund
- Expected rate of return (p.a): The rate of return that you can expect from the mutual fund scheme
- Time period: Number of years you are going to continue the SIP
Based on the entered values, the calculator will show you the total investment amount, estimated returns, and final value of your investment.
We can also take an example to understand this better. Suppose, you decide to invest Rs 15,000 every month in a mutual fund through SIP from which you are expecting around 15% or annual return. You wish to continue this plan for 20 years. After 20 years, the total investment that you would have will be Rs 36,00,000. You would have earned Rs 1,91,39,325 that will make your total corpus of Rs 2,27,39,325.
You will get both lumpsum and SIP mutual fund calculators on INDmoney’s platform.
How to Use INDmoney Mutual Fund Calculator?
The INDmoney mutual fund investment calculator is completely easy to use. You just need to follow these few basic steps:
Step 1: Open INDmoney mutual fund calculator on your smartphone or computer
Step 2: Choose any one from the lumpsum and SIP calculator
Step 3: If you have chosen the lumpsum calculator, enter the total investment amount, expected rate of return, and time period of investment. On the other hand, if you chose the SIP calculator, you have to enter the monthly investment amount, expected rate of return, and time period of investment.
Job done! The calculator will use the return calculation formula and show you the results instantly.
Advantages of Using INDmoney Mutual Fund Calculator
There are several advantages of using mutual funds calculator online.
- You can gauge returns from your lumpsum or SIP investments even without making any investment. This helps you to frame financial goals, set targets, and build a proper mutual fund investment portfolio with valuable insights.
- Based on the expected returns, you can decide which mode of investment (lumpsum or SIP) is suitable for you. If you think that making a lumpsum investment is the best option for using your idle money, go for that. Or if you think that you want to invest less initially and continue for a long term, you can start a SIP.
- Since you can change the inputs conveniently in the INDmoney mutual fund calculator, you can thus compare different mutual funds based on their past performance. You can also compare different investment plans based on different combinations of investment amount and time period and check what suits you the best.
Above all, INDmoney mutual fund calculator saves you from doing manual caculations using complicated formulas. You can get a return estimate within a few seconds.
What is an index fund calculator?
Index fund calculator is nothing other than a mutual fund calculator. This means that you can use a mutual fund calculator to calculate returns from your investments in index funds.
Are the returns shown in the mutual fund calculator fixed?
No, the return from any mutual fund investment is not fixed. The figures shown in the mutual fund calculator are based on the expected rate of return entered in the calculator.
Does returns in my SIP investments compound?
Yes, capital gains earned from investing in mutual fund SIP get reinvested in the fund. This keeps on compounding over the years and helps you secure a huge corpus at the end.
How can I calculate returns from debt funds?
Debt funds are also a type of mutual fund. Hence, you can use a mutual fund calculator to estimate returns from debt funds as well.