What could a monthly investment grow to?
A SIP just means investing a fixed amount every month. Set the amount, how long, and a return - see the future value, what you put in, and the growth, with the magic of compounding on a chart.
How a SIP builds wealth
Two forces do the work. First, you keep buying through ups and downs, so your average cost smooths out (rupee-cost averaging). Second, your returns earn returns - compounding - which is why the gap between what you put in and what it's worth widens fast in the later years. The yearly step-up lets you model raising your contribution as your income grows, which has an outsized effect over a long horizon.
How the calculation works
The result is pure arithmetic on the three numbers you enter - no market data is involved. Your annual return is divided by 12 to get a monthly rate; each month the balance grows by that rate and then your contribution is added; and if you set a step-up, the monthly amount rises once at the end of every year. The chart plots the year-end balance against the total you have put in, which is why the green area pulls away from the dashed line over time. The live strip at the top of the page shows current market figures from our data feed (updated twice each trading weekday), but it does not affect the result.
Because the return is an assumption you choose, the output is a scenario, not a forecast. The figure is also gross: it ignores any front-end load deducted when you buy fund units, the management fee a fund charges inside its unit price, and taxes on gains or dividends. Real fund returns arrive unevenly too - a fund that averages 15% a year might do +40% one year and -20% the next - while this model spreads the growth perfectly smoothly.
How to read the numbers
- The future value is in tomorrow's rupees. At 8% average inflation, ₨10,00,000 ten years from now buys roughly what ₨4,60,000 buys today. Judge the result against future prices, not today's.
- The last years do most of the work. ₨10,000 a month at 15% grows to roughly ₨27,50,000 in ten years on ₨12,00,000 invested - and more than half of that growth arrives in the final three years. Stopping early forfeits the steepest part of the curve.
- Run a low case as well as a high one. Try the same plan at 10% and again at 18%. The honest answer is a range, and the low end is the one to plan around.
- The smooth line is a simplification. A real equity-fund SIP will spend some years underwater. The averaging benefit only shows up if you keep contributing through the bad stretches.
What ₨10,000 a month actually becomes
The table below runs the calculator at a deliberately moderate 12% a year — below what PSX equity funds returned in their best years, above a bank savings account — so the pattern is easy to see. Notice the growth multiple: the first five years barely beat the money you put in, and the jump from 15 to 20 years nearly doubles the outcome. Time in, not the monthly amount, is the lever that matters most.
| Duration | You invest | Worth at 12%/yr | Multiple |
|---|---|---|---|
| 5 years | ₨6,00,000 | ₨8,16,700 | 1.4× |
| 10 years | ₨12,00,000 | ₨23,00,400 | 1.9× |
| 15 years | ₨18,00,000 | ₨49,95,800 | 2.8× |
| 20 years | ₨24,00,000 | ₨98,92,600 | 4.1× |
The step-up field changes the picture more than most people expect. The same ₨10,000 plan over ten years with a 10% yearly step-up — roughly matching salary increments — ends at about ₨33,40,900 instead of ₨23,00,400. You do contribute more (₨19,12,500 against ₨12,00,000), but the habit of raising the debit with every increment is far easier than finding a lump sum later.
And because the return you type dominates everything, here is the same ₨15,000-a-month, 15-year plan at three assumptions — this spread is why we suggest planning around the low case:
| Assumed return | You invest | Worth after 15 yrs |
|---|---|---|
| 10% (cautious) | ₨27,00,000 | ₨62,17,100 |
| 14% (middle) | ₨27,00,000 | ₨90,86,800 |
| 18% (optimistic) | ₨27,00,000 | ₨1,35,84,400 |
SIP or lump sum?
If you already hold a lump sum, mathematically it usually wins to invest it at once - more money spends more time compounding. But that argument assumes you can watch a large amount drop 20% the month after you invest and do nothing, which is precisely where most people break and sell at the bottom. Spreading a lump sum over six to twelve monthly instalments trades a little expected return for a much easier ride, and for money that arrives monthly anyway - a salary - the SIP is not a strategy choice at all, it is simply the only way the money exists. The honest rule: the best plan is the one you will actually continue through a bad year.
Which kind of fund suits a SIP?
The calculator doesn't care where the money goes, but your return assumption should match the vehicle. In Pakistan the realistic menu is: equity funds (highest long-run potential, violent year-to-year swings — the kind of ride only a 10-year-plus horizon absorbs), income and money-market funds (returns that loosely track the SBP policy rate, far steadier, better for goals under five years), and Shariah-compliant versions of both — see our halal investing guide. Our mutual funds guide walks through picking a fund and completing KYC, and money market funds vs bank savings covers the low-risk end. If you'd rather see how a lump sum in gold or a specific PSX stock would actually have done, that's what the backtester is for.
One structural point favours the SIP habit itself: Pakistan's episodes of sharp rupee devaluation and double-digit inflation punish idle cash waiting for a "good time" to invest. A fixed monthly debit removes the timing decision entirely — some months you buy expensive, some cheap, and you never sit for years in cash that inflation is quietly taxing.