STP Calculator
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Runs entirely in your browser — your numbers never leave this page.
How it works
An STP parks your lump sum in a debt fund and moves a fixed amount to equity every month — a phased entry for money you cannot bring yourself to invest at once. The debt portion keeps earning ~7% while it waits its turn.
The honest maths: in a rising market, lump-sum equity beats STP (money invested earlier compounds longer). In a falling market, STP wins (later tranches buy cheaper). Since nobody knows which comes next, STP is really a regret-minimisation tool, not a return-maximisation one.
Practical notes: use the same fund house for instant, load-free transfers; watch debt-fund exit loads (often 1% under a year); and each transfer is a redemption — STCG tax applies on the debt leg if held under 3 years... under current rules, at your slab.
Frequently asked questions
What is an STP?
A Systematic Transfer Plan: you invest a lump sum in a debt/liquid fund and auto-transfer a fixed amount to an equity fund monthly. It phases market entry over 6–18 months.
Does STP give better returns than lump sum?
Not usually — in rising markets, lump sum wins because more money compounds longer. STP's edge is behavioural: it gets hesitant investors into the market instead of sitting in cash.
How long should the STP run?
6–12 months is the sweet spot. Shorter barely phases anything; longer keeps too much money in low-return debt while markets (usually) rise.
Are STP transfers taxable?
Each transfer redeems debt-fund units — gains taxed at your slab (debt funds bought after Apr 2023 have no LTCG benefit). Factor this drag into expectations.
Which funds should I use?
Same fund house for both legs (instant transfers, no exit load surprises): a liquid or money-market fund feeding a diversified equity fund. Avoid credit-risk funds for the parking leg.
STP vs keeping money in savings account?
STP wins — the parked money earns ~7% in a liquid fund vs 3–4% in savings. Same phasing benefit, better parking return.
Can I pause or stop an STP?
Yes, anytime — unlike the lump sum already transferred, future transfers can be cancelled. Flexibility is part of the appeal.
What is a flexi STP?
A variant that transfers more when markets fall and less when they rise (based on a trigger like P/E or NAV). Interesting in theory; keep the formula simple and transparent.
Does STP work for goals under 3 years?
No — equity needs 5+ year horizons. For short goals, keep the lump sum in debt/liquid funds entirely.
STP vs SIP — what is the difference?
SIP invests fresh income monthly; STP invests an existing lump sum gradually. Same rupee-cost averaging idea, different starting point.