Lumpsum Calculator

Investing a one-time amount wisely

A lumpsum investment is common when you receive a bonus, sell an asset or inherit money. Because the whole amount goes in at once, it starts compounding immediately, and that can be powerful over long periods. At an assumed 12% a year, ₹5 lakh grows to about ₹15.5 lakh in ten years and roughly ₹48 lakh in twenty. The second decade adds far more than the first, which is the effect of compounding on a growing base.

The trade-off is timing risk. If markets fall soon after you invest, the whole amount takes the hit. Some investors handle this by moving the money into a liquid or debt fund first and transferring it to equity in instalments over several months. This calculator shows the growth if the full amount is invested on day one, so treat it as the best case for an uninterrupted holding.

Use the result to compare options rather than to predict the future. Try a lower return for a conservative fund and a higher one for equity, and look at how wide the gap becomes over your time frame. Also consider when you will need the money. A lumpsum meant for a goal three years away should not sit in a volatile fund, however attractive the long-term figure looks. Remember that taxes on gains and fund expense ratios reduce what you actually take home, so the real outcome will be a little lower than the projection shown here, especially over long holding periods. Comparing the projection with what a fixed deposit would give over the same period is a quick way to judge whether the extra risk is worth it for you.