Calculate returns on your one-time mutual fund investment with compounding
Best Time for Lumpsum: When markets have corrected significantly (10–20% fall). Invest in index funds or large-cap funds for lower risk.
STP Strategy: Instead of full lumpsum, use STP (Systematic Transfer Plan) — park money in a liquid fund and transfer to equity fund monthly to reduce timing risk.
Tax on Returns: Equity fund gains held over 1 year: LTCG at 10% above ₹1 lakh. Held under 1 year: STCG at 15%.
Enter the one-time amount you want to invest. Lumpsum investments work best when you have a large surplus — from a bonus, inheritance, or sale of an asset.
Enter the annual return you expect. Nifty 50 Index has delivered ~12–14% CAGR over 15+ years. Mid-cap and small-cap funds can give 15–18% but with higher volatility.
The longer you stay invested, the more powerful compounding becomes. ₹1 lakh at 12% for 20 years becomes nearly ₹9.6 lakh — without adding a single rupee more.
The calculator also shows how much a monthly SIP of an equivalent amount would generate, helping you decide which approach suits your situation better.
Lumpsum Formula: A = P × (1 + r)ⁿ
Where: P = principal | r = annual return rate | n = years
Example: ₹1,00,000 × (1 + 0.12)¹⁰ = ₹3,10,585 in 10 years @ 12%
Lumpsum means investing a large amount at one time, while SIP means investing a fixed amount every month. Lumpsum gives higher returns if invested at market lows but carries timing risk. SIP averages out this risk through Rupee Cost Averaging.
Lumpsum is better when: (1) Markets have corrected significantly, (2) You have a large windfall like a bonus or inheritance, (3) You are investing in debt funds where timing matters less. For regular salaried income, SIP is generally more suitable.
Nifty 50 index funds have delivered 12–14% CAGR over 15+ years. Mid-cap funds 15–18% and small-cap funds 18–22% but with much higher risk. Debt funds typically give 6–8%. Always consider your risk appetite.
CAGR (Compound Annual Growth Rate) is the annualised return. Absolute return is the total percentage gain. For example, if ₹1 lakh grew to ₹3 lakh in 10 years, the absolute return is 200% but CAGR is only 11.6% — which is the more meaningful metric.
For equity funds: gains held over 1 year are taxed at 10% (LTCG) above ₹1 lakh per year. Gains under 1 year are taxed at 15% (STCG). For debt funds, gains are added to income and taxed as per your slab.