Question 1

What is a SIP?

Accepted Answer

A Systematic Investment Plan (SIP) lets you invest a fixed amount in a mutual fund at regular intervals (usually monthly). It automates investing and removes the need to time the market.

Question 2

What return rate should I use for SIP calculator?

Accepted Answer

For large-cap equity funds, use 10–12% as a conservative estimate. For mid/small-cap funds, 12–15% is reasonable. For debt funds, use 6–8%. These are historical averages — actual future returns will vary.

Question 3

Is SIP return compounded monthly or annually?

Accepted Answer

SIP returns are compounded monthly using the XIRR method. The formula accounts for the time-weighted nature of monthly investments, not just a simple annual compound.

Question 4

Can I stop a SIP midway?

Accepted Answer

Yes, you can pause or stop a SIP at any time without any penalty (for most funds). Your existing units continue to remain invested and grow. You can restart whenever you want.

Question 5

What is the minimum SIP amount?

Accepted Answer

Most mutual funds allow SIP starting at ₹500/month. Some funds have ₹100 minimum. There is no maximum limit on SIP investments.

Question 6

Does SIP have lock-in?

Accepted Answer

Regular equity funds have no lock-in. ELSS (tax-saving) funds have a 3-year lock-in per SIP instalment. Each monthly SIP in ELSS is locked in separately for 3 years from the date of that particular investment.

Years	Invested	Returns	Total Value
5 years	₹6.0L	₹2.5L	₹8.5L
10 years	₹12.0L	₹11.6L	₹23.6L
15 years	₹18.0L	₹32.6L	₹50.6L
20 years	₹24.0L	₹75.9L	₹99.9L
25 years	₹30.0L	₹1.6Cr	₹1.9Cr

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