Estimate what a single one-time investment could grow into. Unlike a SIP, the whole amount is invested at the start and compounds for the full period.
The invested amount compounds annually at the expected rate of return.
Every year the balance is multiplied by (1 + r), so growth accelerates over time.
Wealth gained is simply the final value minus what you put in.
Future value: FV = P(1 + r)^n
Wealth gained: FV − P
The lumpsum calculator estimates the future value of a single amount invested today and left to grow at a steady annual return. You enter the amount, the expected yearly return and the number of years, and it shows the final value and the wealth gained.
Lumpsum investing is common when a large sum arrives at once: a bonus, a matured fixed deposit or insurance policy, proceeds from selling property, or gratuity at retirement. Unlike a SIP, the whole amount is exposed to the market from the first day, so the result depends heavily on the return over the full period. The calculator helps you see what a sum could become, and how much the answer changes with a different return or horizon.
It compounds once a year, which matches how mutual fund and stock returns are usually quoted, as annual CAGR.
1. Note the amount P, the expected annual return R% and the period n in years.
2. Convert the return to a decimal r = R ÷ 100.
3. Compute the growth factor (1 + r)ⁿ.
4. Future value FV = P × (1 + r)ⁿ.
5. Wealth gained = FV − P.
6. To find the return needed for a target, rearrange: r = (FV ÷ P)^(1/n) − 1.
Each year the investment is multiplied by (1 + r). After one year it is P(1 + r), after two years P(1 + r)², and after n years P(1 + r)ⁿ. The growth in rupees rises every year because each year's return is earned on a bigger balance. At 11%, the gain in year 15 alone is more than three times the gain in year 1. This formula is also the definition of CAGR: whatever path the investment actually takes, its CAGR is the steady r that would take P to the final value in n years.
If you have ₹3 lakh today, investing it all at once puts every rupee to work for the full period. Spreading it through a SIP keeps part of it idle or in a low-return account for months. When markets rise over the period, the lumpsum usually ends higher. When markets fall soon after investing, the SIP's gradual entry buys more units cheaply and can end higher. The calculator assumes a smooth return, so it cannot show this risk, which is known as sequence or timing risk.
The future value is in future rupees. To see its purchasing power, divide by (1 + inflation)ⁿ, or use a real return of roughly the nominal return minus inflation. A quick check on any result is the rule of 72: at 11%, money doubles about every 6.5 years, so over 15 years it doubles a little over twice and should end near five times the starting amount. If the calculator's figure is far from such an estimate, check the inputs.
Rajiv invests his ₹3,00,000 annual bonus in an equity index fund and plans to leave it for 15 years, assuming an 11% annual return.
Write the formula: FV = P(1 + r)^n
Convert the rate: r = 11% = 0.11
Substitute: FV = 300000 × (1 + 0.11)^15
Future value: FV
Wealth gained: 1435376.85 − 300000
Answer: Maturity value ₹14,35,377; Amount invested ₹3,00,000; Wealth gained ₹11,35,377
Treating a smooth assumed return as a forecast of actual market returns.
Investing a sum needed within a year or two in volatile equity.
Forgetting that taxes and fund expenses reduce the net return.
Comparing a lumpsum result with a SIP result that invests the same total over many years.
Estimating the growth of a bonus or matured deposit.
Setting a target corpus and the return needed to reach it.
Comparing a one-time investment with a fixed deposit rate.
Planning the investment of retirement benefits.
Lumpsum or SIP — which is better?
Neither is always better — they suit different situations. A lumpsum puts your full amount to work right away, which helps if the market goes up from here. A SIP spreads your investment over time, which lowers the risk of investing everything just before a fall. If you already have the money and a long time to invest, a lumpsum has historically done well. If you are investing from your monthly income, a SIP is the natural choice.
Are these returns guaranteed?
No. This calculator uses one fixed rate, but real market returns change every year and can even be negative. Treat this result as an example of how compounding works, not a prediction.