SIP & Lumpsum Calculator

Plan your investments with our SIP calculator. Enter monthly contribution, expected returns, and tenure to estimate the future value of your systematic investment plan and achieve your financial goals.

₹35,000.00

5 years

%

11%

0% increase per year

Invested Amount
₹0.00
Est.Returns
₹0.00
Total Value
₹0.00
Share:

What is SIP?

A Systematic Investment Plan (SIP) is a method of investing a fixed amount regularly in mutual funds. It helps you build wealth gradually through disciplined, long-term investing.

What is Lumpsum Investment?

A Lumpsum Investment is a one-time investment of a large sum of money into mutual funds. It is suitable for investors who have surplus funds and want to invest in one go.

What are the Benefits of SIP?

  1. Disciplined Investing: Encourages regular savings and reduces the impact of emotional decisions.
  2. Rupee Cost Averaging: By investing regularly, you buy more units when prices are low and fewer when prices are high.
  3. Power of Compounding: Long-term SIPs help your money grow exponentially due to compounding.
  4. Flexible: You can start with as little as ₹500 and increase/decrease investments as needed.

SIP vs Lumpsum – Which is Better?

SIP is ideal for salaried individuals and beginners who want to invest systematically without timing the market.

Lumpsum works well if you have a large amount available and wish to invest during favorable market conditions.

In most cases, SIPs provide smoother returns by reducing market volatility risk.

Who Should Invest in SIP?

SIP is suitable for:

  1. First-time investors who want to start small
  2. Salaried individuals with regular income
  3. Investors with long-term financial goals like retirement, child’s education, or buying a house

How are SIP Returns Taxed?

SIP returns are taxed based on the type of mutual fund:

  1. Equity Funds: Gains held for less than 1 year are taxed at 15% (short-term). Gains held for more than 1 year are taxed at 10% if they exceed ₹1 lakh (long-term).
  2. Debt Funds: Taxation depends on your income tax slab.

Can I Pause or Stop My SIP?

Yes, SIPs are highly flexible. You can:

  1. Pause: Temporarily stop contributions without cancelling the plan.
  2. Stop: Exit the SIP anytime without penalties.
  3. Modify: Increase or decrease the amount based on your financial situation.

SIP Formula

Future Value of SIP

FV=P× [(1 +r)^n – 1] × (1 +r) ÷r

Required SIP for Target Corpus

P=FV×r ÷ [(1 +r)^n – 1] × (1 +r)

Where:

FVFuture value / target corpus
PMonthly SIP investment
rExpected monthly return rate (annual ÷ 12 ÷ 100)
nTotal number of months

Lumpsum Formula

Future Value of Lump-Sum Investment

FV=P× (1 +r)^n

Required Lump-Sum Investment (Present Value)

P=FV ÷ (1 +r)^n

Where:

FVTarget future value
PLump-sum investment required (present value)
rExpected annual return rate (decimal)
nInvestment duration (in years)

SIP Example

Example: SIP vs Lump Sum Investment

Comparing a monthly SIP with a one-time lump sum investment over 10 years at an expected annual return of 12%.

Investment Comparison

SIP

Monthly Contribution: ₹10,000

Total Contributions: ₹12,00,000

Estimated Corpus ≈ ₹23,23,391

Growth/Earnings ≈ ₹11,23,391

Lump Sum

One-Time Investment: ₹12,00,000

Estimated Corpus ≈ ₹37,27,017

Growth/Earnings ≈ ₹25,27,017

Key Insight

A lump sum investment grows faster due to the entire principal being invested from day one. SIP spreads the investment over time, reducing market timing risk and providing disciplined investing, but the corpus may be lower compared to a lump sum of the same total amount.

Frequently Asked Questions

Other Calculators