Calculate how a one-time investment grows with compound interest. See your wealth after 5, 10, 20 years — and understand when lumpsum beats SIP.
A lumpsum investment means deploying a large amount of money in a single transaction rather than spreading it over time. When you receive a year-end bonus, sell a property, receive an inheritance, or accumulate savings, investing it all at once maximises the time your capital compounds.
The key advantage: 100% of your capital starts compounding from day one. With SIP, only the first instalment earns returns for the full period — later instalments earn proportionally less. Lumpsum eliminates this averaging effect entirely.
Power of time: The same ₹5 lakh at 12% for 20 years becomes ₹48.2 lakh — nearly 10x. For 30 years: ₹1.49 crore. The final decade adds more wealth than the first two decades combined — this is compounding acceleration.
| Scenario | Lumpsum advantage | SIP advantage |
|---|---|---|
| Market timing | Investing at market lows | Cannot time market at all |
| Capital availability | Large amount available | Regular monthly income |
| Market direction | Consistently rising markets | Volatile or falling markets |
| Historical win rate | ~60% of 10-year periods | ~40% of 10-year periods |
| Emotional comfort | High risk tolerance needed | Smooths emotional experience |
| Best strategy | Combine both: SIP for regular income + Lumpsum for bonuses/windfalls | |
Instead of investing directly in equity, first put your lumpsum in a liquid mutual fund. Liquid funds earn 6–7.5% p.a. with next-day redemption. Your money earns while waiting.
Instruct the AMC to automatically transfer a fixed amount monthly from the liquid fund to an equity fund. Over 6–12 months, your full lumpsum moves to equity.
Your money earns 6–7% in liquid fund while waiting, and you average your equity entry price across multiple months. Recommended for amounts above ₹5 lakh.