SIP Calculator: How A Monthly SIP Can Build ₹1 Crore for Child’s Education?

Planning for a child’s higher education is a long‑term financial goal that requires early preparation and disciplined investing. With rising education costs in India and abroad, relying solely on future income or last‑minute borrowing can strain household finances.

A SIP calculator helps families plan effectively by showing how regular monthly investments can grow over time. In this example, a monthly SIP of ₹17,950 over 16 years at an expected return of 12% results in a corpus exceeding ₹1 crore.

What A SIP Is and Why It Works for Education Planning?

A Systematic Investment Plan (SIP) allows investors to invest a fixed sum regularly in mutual funds. This method of staggered investing helps spread out contributions instead of requiring a lump sum.

For education planning, SIPs are suitable because they align with long time horizons and predictable goals. Monthly contributions are easier to manage and budget for, ensuring steady progress toward the target amount.

Inputs Used in The SIP Calculator

The following inputs were used:

• Monthly SIP amount: ₹17,950
• Investment duration: 16 years
• Expected annual return: 12%

Output from the SIP calculator:

• Total invested amount: ₹34,46,400
• Estimated returns: ₹69,89,339
• Total value at maturity: ₹1,04,35,739

This clearly shows how compounding, not just contributions, drives wealth creation.

Compounding’s Key Role In Wealth Creation

Compounding refers to earnings that themselves begin generating further earnings. In SIPs, monthly investments compound over extended periods, enhancing the final value.

Early contributions stay invested the longest, making them disproportionately important in building the corpus. This highlights why starting early is crucial for education planning.

Rising Education Costs Make Early Planning Necessary

Costs for higher education, engineering, medical, MBA and overseas degrees, continue to rise faster than general inflation. Many programmes already require several tens of lakhs in funding.

Building a ₹1 crore education fund through a SIP provides a financial cushion for tuition, living expenses and other costs. A SIP calculator helps families adjust contributions based on expected inflation, time horizon and financial capacity.

Impact Of Starting Late Or Investing Less

A SIP calculator also demonstrates the cost of delaying investment. To achieve the same ₹1 crore target in 12 years instead of 16, the required monthly SIP increases substantially.

Similarly, reducing the investment amount without adjusting duration or expected returns may lead to a corpus shortfall. Regular review is important to ensure the plan remains on track.

Read More: How Much EMI Will You Pay on a ₹50 Lakh Loan?

Conclusion

This SIP calculator example shows how a monthly SIP of ₹17,950 over 16 years at an expected return of 12% can create a corpus of about ₹1.04 crore. With a total investment of ₹34.46 lakh, nearly ₹69.9 lakh is generated purely through compounding.

For parents planning their child’s education, starting early, investing consistently and reviewing progress regularly can make a significant difference. While returns may vary, disciplined long‑term investing remains one of the most effective ways to prepare financially for rising education costs.