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Decide the best way to grow your wealth. Compare the power of compounding in a one-time investment versus disciplined monthly contributions.
This amount will be spread across 120 monthly SIPs of ₹10,000 or invested as a single lumpsum.
Maturity Value
Invested
₹12,00,000
Returns
+₹11,23,391
Maturity Value
Invested
₹12,00,000
Returns
+₹25,27,018
Lumpsum generates ₹ more wealth than SIP over 10 years.
Extra Growth
60.4% Higher
| Year | SIP Balance | Lumpsum Balance | Difference |
|---|---|---|---|
| Year 1 | ₹1,28,093 | ₹13,44,000 | ₹₹12,15,907 |
| Year 5 | ₹8,24,864 | ₹21,14,810 | ₹₹12,89,946 |
| Year 10 | ₹23,23,391 | ₹37,27,018 | ₹₹14,03,627 |
Our calculator helps you visualize the potential growth of your wealth under two different investment strategies. Here's how to get the most accurate results:
Enter the total amount you plan to invest over the entire period.
Input the annual return rate you expect from your mutual fund or asset.
Select how many years you intend to stay invested to see compounding in action.
A Systematic Investment Plan (SIP) allows you to invest a fixed amount regularly. It is the most popular way for retail investors to build wealth because it doesn't require a large capital upfront.
Lumpsum investment means putting a large amount of money into a scheme at once. This is ideal when you have a surplus (like a bonus, inheritance, or sale of property).
SIP ignores market timing by averaging costs. Lumpsum is highly sensitive to the entry point.
SIP is generally lower risk due to volatility smoothing. Lumpsum carries higher risk if invested at a market peak.
SIP is best for salaried individuals. Lumpsum is best for those with windfall gains or idle cash.
Whether you invest via SIP or Lumpsum, the taxation rules for Mutual Funds in India depend on the type of fund and the holding period:
Gains are added to your income and taxed as per your individual income tax slab rate, regardless of the holding period (as per latest rules).
*Tax laws are subject to change. Please consult a tax advisor for the latest updates.
SIP (Systematic Investment Plan) involves investing a fixed amount at regular intervals (e.g., monthly), whereas Lumpsum involves investing the entire amount at once.
In a lumpsum investment, your entire capital starts earning compound interest from day one. In a SIP, your capital is invested gradually over time, so the later installments have less time to compound. Assuming a constant positive return rate, lumpsum will mathematically always yield a higher final amount.
SIPs are chosen for several reasons: 1) Affordability (you don't need a large sum upfront). 2) Rupee Cost Averaging (you buy more units when markets are down, reducing the impact of volatility). 3) Discipline (it automates savings). 4) Timing (lumpsum requires timing the market to avoid investing right before a crash, while SIP mitigates this risk).
Choose lumpsum when you have a large amount of idle cash (e.g., a bonus, inheritance, or sale of an asset) and you believe the market valuation is reasonable or low. If the market is at an all-time high, you might consider staggering your lumpsum investment via an STP (Systematic Transfer Plan) to average out the cost.
Yes, absolutely. You can have an ongoing SIP in a mutual fund and also make additional lumpsum investments in the same folio whenever you have surplus cash.