How the SIP delay cost calculator works
Enter the SIP you intend to run, the annual return you want to assume, the total horizon from today to the date you need the money, and the delay you are considering. The calculator computes two things on the same end date: the corpus if you start this month, and the corpus if you start after the delay. Because the end date does not move, a delay of d months simply removes your first d instalments — the ones that would have compounded the longest.
It then solves the reverse question. Given the shorter remaining period, what monthly instalment would land on the same corpus? That is the catch-up SIP, and the gap between it and your original amount is the real, monthly price of waiting.
The chart plots both paths year by year. The delayed line starts flat, then rises with the same slope — it never catches up, because the missing instalments are exactly the ones that had the most time to grow.
Formula with variable key
Both sides use the future value of an annuity due; only the number of instalments changes.
Formula
Cost of delay = P × A(n) − P × A(n − d), where A(x) = [((1 + r)^x − 1) / r] × (1 + r)
- Where:
- P
- = monthly SIP amount in rupees
- r
- = monthly rate of return = annual return ÷ 12 ÷ 100
- n
- = total instalments if you start today = years × 12
- d
- = delay in months
- A(x)
- = annuity-due factor for x instalments
The catch-up instalment is the same expression rearranged: required SIP = (P × A(n)) ÷ A(n − d). Note that it does not depend on how large P is — only on r, n and d — so the percentage increase needed is the same whether your SIP is ₹2,000 or ₹2 lakh.
Worked example in rupees
Suppose you plan a SIP of ₹10,000 a month at an assumed 12%, and you need the money in 20 years. You are considering starting two years from now instead.
- Start today: 240 instalments, estimated corpus ≈ ₹99,91,479.
- Start after 24 months: 216 instalments, estimated corpus ≈ ₹76,54,392.
- Cost of delay ≈ ₹23,37,087 — about 23.4% of the corpus, for two years of waiting.
- You would have invested ₹2,40,000 less, but ended up with about ₹23.37 lakh less.
- To still reach ₹99,91,479 in the remaining 216 months you would need about ₹13,053 a month — roughly ₹3,053 more, a 30.5% larger instalment.
Read those last two lines together. Two years of ₹10,000 instalments that you skipped are worth ₹2.4 lakh of your own money; the corpus they would have produced is ten times that. The difference is entirely the compounding those early instalments would have earned.
This illustration assumes a constant 12% a year, assumed for this example; it is not a forecast. For reference, AMFI Best Practices Circular No. 109/2023-24 prescribes 12.93% for equity-fund illustrations: the mean of 10-year rolling returns of the Nifty 50 between 01/06/2013 and 30/05/2023 (Sensex 12.64%, 10-year G-Sec 7.20%). Calculators accept rates up to 13%.
Past performance may or may not be sustained in future and is not a guarantee of any future returns.
Mutual Fund investments are subject to market risks, read all scheme related documents carefully.
What different delays cost
| Delay | Instalments left | Estimated corpus | Cost of delay | Catch-up SIP |
|---|---|---|---|---|
| None | 240 | ₹99,91,479 | — | ₹10,000 |
| 6 months | 234 | ₹93,53,891 | ₹6,37,588 | ₹10,682 |
| 1 year | 228 | ₹87,53,254 | ₹12,38,225 | ₹11,415 |
| 2 years | 216 | ₹76,54,392 | ₹23,37,087 | ₹13,053 |
| 3 years | 204 | ₹66,79,208 | ₹33,12,271 | ₹14,959 |
| 5 years | 180 | ₹50,45,760 | ₹49,45,719 | ₹19,802 |
A five-year delay on a twenty-year goal halves the corpus. That is the shape of compounding: the last instalment you make contributes one month of growth, the first contributes twenty years of it.
This illustration assumes a constant 12% a year, assumed for this example; it is not a forecast. For reference, AMFI Best Practices Circular No. 109/2023-24 prescribes 12.93% for equity-fund illustrations: the mean of 10-year rolling returns of the Nifty 50 between 01/06/2013 and 30/05/2023 (Sensex 12.64%, 10-year G-Sec 7.20%). Calculators accept rates up to 13%.
Past performance may or may not be sustained in future and is not a guarantee of any future returns.
Mutual Fund investments are subject to market risks, read all scheme related documents carefully.
Why the early instalments matter most
Every instalment earns the same rate, but not for the same length of time. In a 20-year SIP at 12%, the instalment paid in month one grows for 240 months and multiplies roughly ten-fold on these assumptions; the instalment paid in the final month grows for one. When you delay, you do not lose an average instalment — you lose the most productive ones at the front of the queue.
This is also why a smaller SIP started now often beats a larger SIP started later. Running the numbers above in reverse: ₹10,000 started today reaches roughly the same place as ₹13,053 started two years later. If you cannot afford the full amount, start with what you can and use a step-up SIP to raise it as your income grows.
This illustration assumes a constant 12% a year, assumed for this example; it is not a forecast. For reference, AMFI Best Practices Circular No. 109/2023-24 prescribes 12.93% for equity-fund illustrations: the mean of 10-year rolling returns of the Nifty 50 between 01/06/2013 and 30/05/2023 (Sensex 12.64%, 10-year G-Sec 7.20%). Calculators accept rates up to 13%.
Past performance may or may not be sustained in future and is not a guarantee of any future returns.
Mutual Fund investments are subject to market risks, read all scheme related documents carefully.
Common reasons people delay — and what to do instead
- "I'll start when I have a lump sum." A SIP does not need one. Start at the scheme minimum and increase later.
- "I'm waiting for the market to fall." Timing the entry is exactly what a SIP is designed to make unnecessary; instalments made when prices are low buy more units automatically.
- "My KYC isn't done." It is a one-time process and usually completes in a few days. Getting it out of the way removes the excuse permanently.
- "I want to pick the perfect scheme first." A reasonable diversified fund started today usually beats a perfect one started in two years. You can switch later; you cannot recover the time.
- "I have debt to clear." This one can be legitimate — a 14% personal loan costs more than a SIP is assumed to earn. Clear the high-cost debt, but keep a small SIP running so the habit survives.
Taxes and the honest caveats
The comparison here is pre-tax and pre-cost on both sides, so the delay cost is not distorted by them. On redemption of equity-oriented funds, gains on units held over 12 months are long-term and taxed at 12.5% on the amount above ₹1.25 lakh in a financial year; units held for 12 months or less attract short-term capital gains tax at 20%.
A single flat rate of return is assumed throughout. Real markets do not deliver a steady 12% — the sequence of returns matters, and an investor who started at an unlucky moment may see a very different outcome. What the calculator illustrates is the arithmetic of time in the market, not a promise about any scheme.
Frequently asked questions
What does 'cost of delay' mean here?
It is the difference between the corpus you would have on your target date if you started this month and the corpus you would have if you started after the delay, with the same instalment and the same assumed return.
Why does a two-year delay cost so much more than two years of instalments?
Because you lose the instalments that would have compounded for the longest. In the 20-year example, skipping ₹2.4 lakh of instalments costs about ₹23.37 lakh of corpus on the assumptions used.
Does the cost of delay depend on the size of my SIP?
The rupee cost does, proportionally. The percentage does not — a delay of two years on a 20-year plan costs about 23% of the corpus whether the SIP is ₹2,000 or ₹2 lakh.
Is it better to start small now or wait and start bigger?
Starting now is usually better arithmetic. In the worked example, ₹10,000 started today matches ₹13,053 started two years later. Beginning small and stepping up annually captures most of the benefit.
What if I extend the goal date instead of raising the SIP?
That is the third option and often the most comfortable one. Increase the horizon in the calculator by the length of the delay and you will see the original instalment reach a similar corpus — you have traded time for money instead.
Does this account for inflation?
No. Both corpus figures are in future rupees. To see what a goal will actually cost by then, use the Goal SIP Calculator, which inflates the target before solving for the instalment.
What if I already delayed?
Then this tool tells you what to do next: enter the remaining horizon and it will show the instalment needed from here. Nothing about the past changes the fact that today is the earliest you can now start.
Should I pause my SIP when markets fall?
Pausing during a fall does the same damage as delaying the start — it removes instalments at exactly the point when each one buys more units. If cash flow forces a pause, restart as soon as you can.
Is 12% a safe assumption?
It is an assumption for illustration, a little below the 12.93% that AMFI prescribes for equity-fund illustrations (the mean of 10-year rolling returns of the Nifty 50 between June 2013 and May 2023). It is not a promise. Try the same delay at 8% and 10%; the cost of delay shrinks at lower assumed returns but never disappears.
Can I make up for the delay with a lumpsum instead?
Yes, if you have one. A lumpsum invested at the start of the remaining period compounds for the whole of it. The Goal SIP Calculator lets you enter existing savings and shows the reduced SIP that results.
Can Two Plus Two Nine help me start now?
Yes. As an AMFI-registered Mutual Fund Distributor (ARN-171746) we help with KYC and SIP setup in regular plans on the FundzBazar platform. We distribute schemes and explain how they work; we do not offer investment advice.