Compare percentage and fixed-amount annual SIP step-up strategies and see how they accelerate long-term wealth versus flat SIP contributions. Starting at ₹5,000/month, a 10% annual step-up for 20 years at 12% builds ₹1.17 Cr vs ₹50 L flat.
Final Corpus
₹86,83,849
Total invested: ₹38,12,698 · Wealth gained: ₹48,71,152 (127.8%)
Estimated LTCG tax: ₹5,93,269
In-hand corpus: ₹80,90,580
Effective tax rate: 6.83%
| Year | Monthly SIP | Total invested | Corpus |
|---|---|---|---|
| 1 | ₹10,000 | ₹1,20,000 | ₹1,28,093 |
| 2 | ₹11,000 | ₹2,52,000 | ₹2,85,241 |
| 3 | ₹12,100 | ₹3,97,200 | ₹4,76,410 |
| 4 | ₹13,310 | ₹5,56,920 | ₹7,07,323 |
| 5 | ₹14,641 | ₹7,32,612 | ₹9,84,570 |
| 6 | ₹16,105 | ₹9,25,873 | ₹13,15,734 |
| 7 | ₹17,716 | ₹11,38,461 | ₹17,09,527 |
| 8 | ₹19,487 | ₹13,72,307 | ₹21,75,956 |
| 9 | ₹21,436 | ₹16,29,537 | ₹27,26,501 |
| 10 | ₹23,579 | ₹19,12,491 | ₹33,74,326 |
| 11 | ₹25,937 | ₹22,23,740 | ₹41,34,516 |
| 12 | ₹28,531 | ₹25,66,114 | ₹50,24,342 |
| 13 | ₹31,384 | ₹29,42,725 | ₹60,63,565 |
| 14 | ₹34,523 | ₹33,56,998 | ₹72,74,790 |
| 15 | ₹37,975 | ₹38,12,698 | ₹86,83,849 |
Starting SIP: ₹5,000/month. Assumed return: 12% CAGR. Step-up rates as shown.
| Strategy | 10-Year Corpus | 20-Year Corpus | 30-Year Corpus |
|---|---|---|---|
| Flat SIP (no increase) | ₹11.6 L | ₹50.0 L | ₹1.76 Cr |
| 5% annual step-up | ₹14.0 L | ₹72.5 L | ₹3.07 Cr |
| 10% annual step-up | ₹17.1 L | ₹1.17 Cr | ₹5.88 Cr |
| 15% annual step-up | ₹21.1 L | ₹1.75 Cr | ₹11.4 Cr |
Illustrative projections only. Actual returns vary. LTCG tax not deducted in this table.
A standard SIP invests the same amount every month for the entire tenure. A step-up SIP increases the monthly contribution each year. This leverages two compounding effects simultaneously:
Year-wise SIP amount (10% annual step-up, starting ₹5,000):
₹5,000
Year 1
₹5,500
Year 2
₹6,050
Year 3
₹7,321
Year 5
₹11,797
Year 10
₹19,027
Year 15
₹30,671
Year 20
By year 20, you are investing ₹30,671/month — 6× the starting amount. Yet the early years of higher market compounding on smaller amounts do the heavy lifting, while later years' larger contributions add fuel. This is why even a modest 5% annual step-up dramatically changes the final corpus.
A step-up SIP (also called top-up SIP) automatically increases your monthly SIP amount every year — either by a fixed percentage (e.g., 10%) or a fixed amount (e.g., ₹500/year). This aligns your investment growth with your salary increments, accelerating long-term wealth creation significantly.
Starting with ₹5,000/month at 12% CAGR for 20 years: flat SIP builds ₹49.96 lakh corpus. A 10% annual step-up on the same starting amount builds ₹1.17 crore — over 2.3× more wealth. The compounding effect of both investment growth AND contribution growth is the reason.
The step-up SIP has no single closed-form formula — it is calculated by summing the future value of each year's SIP tranche (each with a different monthly amount). For a percentage step-up of g per year and monthly return r: Total corpus = Σ (from year n=1 to N) of [SIP_n × FV_annuity_factor(r, 12) × (1+r_annual)^(N-n)], where SIP_n = SIP_0 × (1+g)^(n-1). The calculator runs this year-by-year iteration.
Percentage step-up compounds faster on a large base — ideal if you expect consistent salary growth (e.g., 10–15% increments per year). Fixed amount step-up is simpler to budget and suitable for salaried employees with moderate, predictable hikes. For long tenures (15+ years), percentage step-up almost always outperforms fixed amount step-up.
Equity mutual fund gains above ₹1.25 lakh per year are taxed at 12.5% LTCG (Budget 2024). On a step-up SIP with large corpus, the LTCG at redemption can be significant. The calculator shows pre-tax and post-LTCG corpus to give you a realistic net figure.
Most Indian salaried professionals receive 8–15% annual increments. A 10% annual SIP step-up is conservative and practical — it matches the lower end of typical salary growth. Even a 5% annual step-up meaningfully improves outcomes. The key is to set it once and automate it so the increase happens without effort.
This calculator is for informational and educational purposes only. Results are estimates based on the assumptions you provide. Mutual fund investments are subject to market risks. Past performance does not guarantee future results.