How a SIP works
A SIP (systematic investment plan) means investing a fixed amount every month, usually into a mutual fund. Each month's money starts earning returns, and those returns earn returns of their own. That's compounding, and it's why time matters more than the amount.
Example
AED 1,000 a month for 15 years at 10% a year, no lump sum, no yearly increase.
What return should I use?
Nobody knows future returns. Equity funds can have very good years and very bad ones. Many people check a range: a cautious figure such as 6%, a middle one such as 10%, and an optimistic one such as 12%. Fixed deposits and savings accounts pay less, but with less risk.
Investing from the UAE
- The UAE doesn't tax personal investment gains for individuals.
- If you invest in your home country, for example Indian mutual funds through an NRE or NRO account, that country's tax rules may apply to your gains.
- Check fees and exchange rates. Converting dirhams to rupees costs a little each time.
Common questions
What is a SIP?
A systematic investment plan: investing a fixed amount every month, usually into a mutual fund, so your money grows through compounding over time.
What is a step-up SIP?
A SIP where you raise your monthly amount each year, often in line with salary increases. Even a 5% yearly increase makes a big difference over 15 to 20 years.
Are investment gains taxed in the UAE?
The UAE doesn't tax personal investment gains for individuals. If you invest in another country, its tax rules may apply.
Are SIP returns guaranteed?
No. Market-linked investments can fall as well as rise. The calculator shows an estimate based on the return you enter.
Related calculators
This calculator gives an estimate for guidance only. It is not financial advice. Past returns don't guarantee future returns.