Personal Finance Financial Guides
How Much SIP Do You Need for Your Goal?
Start from the goal, not the SIP amount. How to work out the monthly investment for ₹25 lakh, ₹1 crore or any target — including inflation.
Most people pick a SIP amount by asking “what can I spare?” A better question is “what do I need?” Start from the goal — how much, by when — and work backwards to the monthly investment. It turns a vague intention into a plan you can actually track.
Key takeaways
- To build ₹25 lakh in 10 years at 12%, you need a SIP of about ₹10,760 a month.
- For ₹1 crore at 12%, you need about ₹19,819 a month over 15 years, or about ₹10,009 over 20 years.
- Always inflate the goal to its future cost first — then calculate the SIP.
The formula
The required monthly SIP for a target amount is:
where i is the expected monthly return (annual return ÷ 12 ÷ 100) and n is the number of months. It assumes each instalment is invested at the start of the month.
Step 1: Put a future price on the goal
Goals cost more in the future. A course that costs ₹10 lakh today could cost about ₹41.8 lakh in 15 years if education costs rise 10% a year. Plan for that number, not today’s price — see how inflation eats your savings.
Step 2: Choose a realistic return
Match the expected return to the investment you will actually use and the time horizon. For a long-term equity-heavy plan, many people use 10–12%; for shorter or more conservative plans, lower. A cautious assumption means you are more likely to hit the target.
Step 3: Calculate the SIP
| Goal | Time | Return | Monthly SIP needed |
|---|---|---|---|
| ₹25 lakh | 10 years | 12% | ₹10,760 |
| ₹25 lakh | 10 years | 10% | ₹12,103 |
| ₹1 crore | 15 years | 12% | ₹19,819 |
| ₹1 crore | 20 years | 12% | ₹10,009 |
| Education goal of ₹41.8 lakh | 15 years | 12% | ₹8,279 |
Two things stand out. A lower return assumption raises the SIP noticeably, so be conservative. And five extra years for a ₹1 crore goal halves the monthly amount — time does more of the work than money.
Step 4: Make it easier
- Start smaller and step up: begin with what you can afford today and raise it every year with a step-up SIP.
- Use existing savings: money you already have for the goal reduces the SIP needed.
- Separate goals: one SIP per goal makes it easy to track progress and adjust.
- De-risk near the end: as the goal comes within 2–3 years, gradually move money to safer options so a market fall cannot derail it.
Returns are not guaranteed; the figures here assume a constant return for illustration. Review each goal once a year and adjust the SIP if you are falling behind.
Plan your own goal
Use the Inflation Calculator to find the future cost of your goal, then test SIP amounts in the SIP Calculator until the estimated value reaches it. For retirement, the Retirement Calculator does both steps for you.
This article is for general information only and is not financial, tax or legal advice. Rates, rules and products change — check current terms with your lender or a qualified adviser. Disclaimer.