What is SIP?
Systematic Investment Plan
A SIP is a method of investing a fixed amount into a mutual fund at regular intervals — usually monthly — instead of investing a lump sum all at once. It automates disciplined investing and averages your purchase cost over market ups and downs.
Because a fixed rupee amount buys more units when the fund's NAV is low and fewer units when it's high, SIPs benefit from rupee-cost averaging over volatile periods — you never have to correctly time the market.
SIPs can be started with as little as ₹100–₹500 per month with most Indian mutual funds, and can be paused, stepped up, or stopped at any time without penalty (unlike ELSS SIPs, which have a 3-year lock-in per instalment).
Formula
FV = P × [((1 + r)^n − 1) ÷ r] × (1 + r)