SIP calculator vs Excel sheet: which one is more convenient for calculating returns?

A Systematic Investment Plan (SIP) is a method of investing a fixed amount of money in a mutual fund scheme every month. It is a great way to invest for the long term and to average your cost of purchase. There are two ways to calculate the expected returns of a SIP: using a SIP calculator or manually.

SIP calculator

A SIP calculator is a tool that helps you calculate the expected returns of a SIP. It takes into account the following factors:

• The amount you invest
• The rate of return you expect
• The duration of your investment

Excel sheet

You can also use an Excel sheet to manually calculate the expected returns of a SIP. To do this, you will need to use the following formula:

Expected returns = (Amount invested * Rate of return * Duration) / 100

For example, if you invest Rs.1000 every month in a mutual fund scheme with an expected rate of return of 10%, and you invest for 10 years, your expected returns will be Rs.18,130.

Which one is more convenient?

So, which one is more convenient: a SIP calculator or an Excel sheet?

SIP calculator Advantages

• Easy to use
• Quick and convenient
• Updated with the latest market data
• Can help you compare different mutual fund schemes
• Can help you track your progress over time

Disadvantages

• May not be as accurate as manual calculations
• May not be able to handle complex calculations
• May not be customizable

Excel sheet Advantages

More accurate than a SIP calculator if the calculation is complex or the input data is inaccurate

• Can be used to handle complex calculations
• Can be customized to your specific needs

Disadvantages

• More time-consuming than using a SIP calculator
• Requires more knowledge of Excel
• Not as convenient as using a SIP calculator

Ultimately, the best way to calculate the expected returns of an SIP is to use the SIP calculator if the calculation is simple and the input data is accurate. If the calculation is complex or the input data is inaccurate, then you may want to use an Excel sheet.

Here are some additional tips for calculating the expected returns of an SIP:

Use a reliable calculator or Excel sheet: There are a number of SIP calculators and Excel sheets available online and in financial publications. Make sure to use a reliable calculator or Excel sheet that is updated with the latest market data.

Consider your risk tolerance: When calculating the expected returns of an SIP, it is important to consider your risk tolerance. This is how much risk you are willing to take with your investment. If you are risk-averse, you may want to choose a scheme with a lower risk profile.

Set realistic goals: When calculating the expected returns of an SIP, it is important to set realistic goals. Don’t expect to get rich quick with an SIP. It takes time and patience to see the benefits of SIP investing.

Rebalance your portfolio regularly: As your investment goals change, you will need to rebalance your portfolio. This means selling some of your investments and buying others. This will help to ensure that your portfolio remains aligned with your goals.