1. What is this SIP Calculator?

This calculator determines the future value of a $20 Systematic Investment Plan (SIP) with a fixed 10% annual growth rate. It shows how your investment grows over time with compound returns.

2. How Does the Calculator Work?

The calculator uses the compound interest formula:

Where:

• \( FV \) — Future Value of the investment
• \( 20 \) — Initial investment amount ($20)
• \( 10/100 \) — 10% annual growth rate (0.10)
• \( n \) — Number of years invested

Explanation: The formula calculates how $20 grows at a constant 10% annual return, with returns compounding each year.

3. Importance of SIP Calculations

Details: Understanding compound growth helps investors see the long-term potential of consistent investments and the power of reinvested returns.

4. Using the Calculator

Tips: Simply enter the number of years you plan to maintain this investment. The calculator assumes a fixed $20 investment with 10% annual returns.

5. Frequently Asked Questions (FAQ)

Q1: Is 10% return guaranteed?
A: No, this is a hypothetical calculation. Actual returns may vary based on market conditions.

Q2: What if I invest more than $20?
A: You can multiply the result by your actual investment amount divided by 20.

Q3: Are taxes considered in this calculation?
A: No, this is a pre-tax calculation. Actual after-tax returns may be lower.

Q4: How often is compounding applied?
A: The calculator assumes annual compounding for simplicity.

Q5: Can I change the growth rate?
A: This specific calculator uses a fixed 10% rate. For variable rates, you would need a different calculator.