The answer in plain English
The standard month-end formula is P × ((1 + i)^n − 1) ÷ i, where P is the instalment, i the assumed monthly rate and n the number of instalments. If i is zero, the result is simply P × n. A month-start contribution receives one extra modelled month of growth.
What to check
- State whether the annual assumption is divided by 12 or converted to an effective monthly rate.
- Keep contribution growth, such as an annual step-up, separate from investment return.
- Label taxes, costs and inflation assumptions; a future value before them is not spendable purchasing power.
- Test a lower outcome and your ability to continue contributions, not only a high-return case.
A useful comparison
| Input | Meaning | Common mistake |
|---|---|---|
| Monthly amount | Money contributed per instalment | Calling contributions investment gains |
| Years | Number of modelled contribution periods | Treating a longer horizon as a guarantee |
| Return assumption | A scenario chosen by the user | Labelling it a fund’s promised rate |
| Timing | Month start/end and actual schedule | Mixing calculator conventions |
Make the distinction clear
The worked scenarios below use month-end payments, monthly rate equal to the annual assumption divided by 12, no step-up and no tax, fees or withdrawals. They are mathematical examples, not fund forecasts. Actual markets fluctuate and the sequence of returns can differ materially from a smooth calculator path. Change inputs in the linked MF Analyser calculator and keep the assumptions with any result you share.
Worked SIP scenarios for this question
Month-end instalments; monthly rate = annual assumption ÷ 12; no missed payments, step-up, fees, taxes or withdrawals. These are original calculations, not forecasts or historical returns of named funds. Real market paths can produce losses and do not grow at one fixed rate.
| Monthly contribution | Years | Scenario rate | Total contributed | Illustrative ending value |
|---|---|---|---|---|
| ₹5,000 | 10 | 6% assumed | ₹6,00,000 | ₹8,19,397 |
| ₹5,000 | 10 | 8% assumed | ₹6,00,000 | ₹9,14,730 |
| ₹5,000 | 10 | 10% assumed | ₹6,00,000 | ₹10,24,225 |
To reproduce a row, enter the contribution and period in the MF Analyser SIP calculator, select the stated rate convention and month-end timing, and keep excluded costs/tax settings consistent. A calculator may differ if it uses effective-monthly compounding or month-start payments. Differences from conventions are not evidence that a particular fund promises either result.
One final question before acting
Does the figure or document match the exact scheme, plan, option, period and purpose in your question? Keep the source date with the answer. For a real transaction or personal decision, the current scheme documents and your own records take priority over a saved educational example.