What is Step Up Calculator?
Step Up calculator or Top up calculator gives you the future value of your SIP investments which increases periodically by a given percentage. In this calculator one needs to input certain variables like monthly investment amount, the growth percentage of your SIP investment, the expected rate of return and the tenure of the investment. After entering the variables, the calculator shows the maturity value and the total investment made during the period.
What is SIP?
Systematic Investment Plan or SIP is the most disciplined style of investment in which a fixed amount of money is invested at regular intervals (yearly, quarterly, monthly). For SIP you will have to decide the invested amount, the SIP date and the scheme in which you want to invest.
Why Step Up SIP?
SIP or the systematic investment plan helps you to compound your investment in order to build your wealth. However, when you step up your SIP investments periodically they have the chances of even building greater wealth for you. The other reason is as you grow your income also grows so your savings should also increase proportionately therefore you should top up your SIP periodically.
What are the different Types of SIP?
There are four types of SIP:
Step Up SIP: Step Up SIP or Top Up SIP is a type in which you can increase your investment amount periodically.
Flexible SIP: Flexible SIP permits you to increase as well as decrease your investment amount. This helps you to skip some payments when there is a cash crunch and you can also make more contribution to your SIP account when there are surplus funds with you.
Perpetual SIP: While making an SIP investment via mutual funds, if the end period is not decided in the mandate it is known as perpetual SIP. One has the option to redeem the funds whenever required or when the financial goals are achieved.
Trigger SIP: This SIP offers one to select the NAV, index level, SIP start date or event etc. This type of SIP is not highly recommended as it encourages speculation to some extent.
Can I miss the payment of Top Up SIP or Step Up SIP?
Yes, one can miss the payment of step up SIP or Top Up SIP if the funds that you have chosen for SIP investments provide the facility to pause the payment.
Can Step Up SIP be started online?
Yes, one can start SIP online after selecting the right funds in which you want to invest. The funds can be selected based on your investment objectives and risk profile.