Is ₹40,000 SIP enough for 5 years?

A ₹40,000/month SIP for 5 years projects to roughly ₹32,99,455 at 12% annual return. For long-term goals, stepping up the SIP each year typically makes a much bigger difference than starting with a higher amount.

What return rate is assumed in this calculation?

We assume 12% per annum — a common long-term assumption for Indian equity mutual funds and index funds. Actual returns vary year-to-year. Use 10–12% as a conservative planning number.

Can a SIP lose money?

Yes — SIPs invest in market-linked instruments and can fall in value, especially in the short term. Over 7+ year horizons, Indian equity SIPs have historically recovered and grown.

Should I increase my SIP every year?

Almost always yes. Stepping up your SIP by even 5–10% each year — matched to your salary hike — dramatically outperforms a flat SIP without feeling pinched.

What if I extend the SIP beyond 5 years?

Time is the most powerful lever in compounding. Each additional year typically adds far more than the previous one because compounding works on a much larger base.

Is ₹40,000 SIP enough for 5 years?

It depends on your goal. A ₹40,000/month SIP for 5 years projects to roughly ₹32,99,455 at 12% annual return. For long-term goals like retirement or a child's education, increasing the SIP every year (step-up) typically makes a much bigger difference than starting with a higher amount.

What return rate is assumed in this calculation?

We assume 12% per annum — a common long-term assumption for Indian equity mutual funds and index funds. Actual returns vary year-to-year. Use 10–12% as a conservative planning number so you're not disappointed if markets underperform.

Can a SIP lose money?

Yes — SIPs invest in market-linked instruments and can fall in value, especially in the short term. Over 7+ year horizons, Indian equity SIPs have historically recovered and grown. SIPs reduce timing risk via rupee-cost averaging, but they do not eliminate market risk.

Should I increase my SIP every year?

Almost always yes. Stepping up your SIP by even 5–10% each year — matched to your salary hike — dramatically outperforms a flat SIP without feeling pinched. Most fund houses and apps support automatic step-up SIPs.

What if I extend the SIP beyond 5 years?

Time is the most powerful lever in compounding. Each additional year typically adds far more than the previous one because compounding works on a much larger base. Extending by even 5 years can meaningfully change the final corpus.

Open the full SIP calculator

Back

SIP scenario · India

SIP Calculator: ₹40,000/month for 5 years

If you invest ₹40,000/month for 5 years, you could build ₹33L — assuming a 12% annual return.

Projected future value

₹32,99,455

Total invested

₹24,00,000

Estimated gains

₹8,99,455

Start this investment plan

Start a ₹40,000/month SIP based on your plan.

Start SIP

Recommended: Angel One · Free to start · Takes 5 minutes

Growth over time

Invested vs Gains

Your money could grow 1.4× in 5 years

That's compounding doing its quiet work in the background — month after month.

In today's purchasing power

At ~6% inflation, ₹32,99,455 in 5 years is worth roughly ₹24,65,544 in today's money.

Year-by-year breakdown

How ₹40,000/month compounds at 12% annual return.

Year	Invested	Gains	Total value
0	₹0	₹0	₹0
1	₹4,80,000	₹32,373	₹5,12,373
2	₹9,60,000	₹1,29,728	₹10,89,728
3	₹14,40,000	₹3,00,306	₹17,40,306
4	₹19,20,000	₹5,53,393	₹24,73,393
5	₹24,00,000	₹8,99,455	₹32,99,455

How a ₹40,000 SIP grows over 5 years

By investing ₹40,000 every month for 5 years, you contribute a total of ₹24,00,000. Assuming an average return of 12% per year — typical for Indian equity mutual funds over long horizons — the corpus compounds to about ₹32,99,455. Roughly ₹8,99,455 of that is pure compounding gain.

The power of compounding

Compounding is when your returns start earning returns of their own. In a SIP, every monthly contribution gets its own runway to grow. The contributions you make in the first 5 years usually generate the most lifetime growth — simply because they have the longest time to compound.

Why long-term horizons matter

Most of the gain in a long SIP arrives in the final stretch. In a 5-year plan, the last 5 years often contribute more growth than the first 5 combined, because compounding works on a much larger base by then. Staying invested through market noise is what separates great outcomes from average ones.

Tip: increase your SIP every year

Even a 5–10% yearly step-up — matched to your salary hike — meaningfully outperforms a flat SIP. Try the full SIP calculator to see what step-up does to this scenario.

Adjust this scenario