Lumpsum vs SIP Calculator

Investment

Deploy the same money two ways — all at once as a lump sum, or spread evenly as a monthly SIP — and see which finishes ahead over your chosen horizon.

Free · No sign-up · Private6 min readUpdated 27 July 2026

In short: A lumpsum invests the entire amount today so every rupee compounds from day one, while a SIP spreads that same amount into monthly instalments to reduce timing risk — in a steadily rising market the lumpsum almost always ends up worth more.

Your inputs

Results

Lumpsum maturity

₹37,27,018

SIP maturity

₹23,23,391

₹10,000/month

Difference

₹14,03,627

Lumpsum ahead

Lumpsum vs SIP growth

How the same money grows when invested at once versus spread monthly.

Year-wise comparison

Year-wise comparison
Year	Lumpsum value	SIP value	Difference
1	₹13,44,000	₹1,28,093	₹12,15,907
2	₹15,05,280	₹2,72,432	₹12,32,848
3	₹16,85,914	₹4,35,076	₹12,50,837
4	₹18,88,223	₹6,18,348	₹12,69,875
5	₹21,14,810	₹8,24,864	₹12,89,946
6	₹23,68,587	₹10,57,570	₹13,11,017
7	₹26,52,818	₹13,19,790	₹13,33,028
8	₹29,71,156	₹16,15,266	₹13,55,890
9	₹33,27,695	₹19,48,215	₹13,79,479
10	₹37,27,018	₹23,23,391	₹14,03,627

Both paths assume the same constant annual return; the SIP invests the total spread evenly each month.

Formula

Lumpsum: FV = P × (1 + i)ⁿ • SIP: M = A × [((1+r)ⁿ − 1) / r] × (1+r)

P: Total amount invested at once (lumpsum)
A: Monthly SIP instalment = P ÷ (years × 12)
i: Annual rate of return (for the lumpsum)
r: Monthly rate of return (annual ÷ 12 ÷ 100)
n: Number of periods (years for lumpsum, months for SIP)

Step-by-step calculation

Worked with the default values.

1
Monthly SIP instalment
₹12,00,000 ÷ (10 yrs × 12)
= ₹10,000
2
Lumpsum maturity
₹12,00,000 × (1 + 12%)^10
= ₹37,27,018
3
SIP maturity
P × [((1+r)ⁿ − 1) / r] × (1+r)
= ₹23,23,391
4
Difference (lumpsum − SIP)
₹37,27,018 − ₹23,23,391
= ₹14,03,627

How it works

The lumpsum path invests the full amount today, so all of it compounds for the entire period.
The SIP path splits the same total into equal monthly instalments, each compounding only from the month it is invested.
Because early money compounds longest, the lumpsum builds a bigger base whenever returns stay positive over the horizon.

Examples

₹12 lakh at 12% for 10 years — lumpsum vs ₹10,000/month SIP

Lumpsum grows to about ₹37.3 lakh, while the SIP reaches roughly ₹23.2 lakh — a gap of around ₹14 lakh.

₹24 lakh at 10% for 15 years — lumpsum vs ₹13,333/month SIP

Lumpsum compounds to about ₹1 crore, versus roughly ₹55 lakh for the SIP over the same period.

Understanding the Lumpsum vs SIP Calculator

The core trade-off

Investing a lump sum and running a SIP with the same total money are two ways to answer one question: when should the money enter the market? A lumpsum puts every rupee to work today, so it compounds for the full horizon. A SIP holds most of the money back and feeds it in monthly, accepting slower deployment in exchange for spreading out the entry price.

Because compounding rewards time, the path that gets money invested earliest usually ends up larger — provided returns are positive over the period. That is why, under a single constant assumed return, this calculator almost always shows the lumpsum ahead.

Why a SIP can still win in the real world

Markets do not deliver one smooth return every year. If prices fall sharply just after you would have invested a lumpsum and then recover, a SIP quietly buys more units during the dip and can finish ahead. This is rupee-cost averaging: your average purchase price is pulled down by the cheap months.

The catch is that no one knows in advance whether the market will rise or fall right after they invest. A SIP is therefore best understood as buying insurance against bad timing — you give up some expected upside for a smoother, less nerve-wracking ride.

Which should you choose?

Two practical factors decide it:

Do you actually have the money now? Most salaried investors fund a SIP from monthly income and never hold a large idle sum. For them the comparison is academic — a SIP is the only realistic route.
How would you feel about a 20% drop right after investing? If a sharp near-term fall would tempt you to sell, staggering the entry protects your behaviour as much as your returns.

A middle path

You do not have to pick one extreme. A Systematic Transfer Plan (STP) parks a lump sum in a low-risk liquid or arbitrage fund and moves a fixed amount into equity each month. This keeps the cash earning something while it waits and averages the equity entry — a pragmatic blend of both approaches. Whatever you choose, keep the assumed return conservative and match the horizon to your goal.

Pros

Lumpsum lets every rupee compound from day one, maximising growth in a rising market.
SIP reduces timing risk by averaging your entry across many months and price levels.
Comparing both side by side clarifies the real cost of waiting versus investing at once.
A SIP requires no large sum upfront — it works directly from monthly income.
The two can be combined via an STP to capture the strengths of each.

Cons

A lumpsum invested just before a market crash can underperform badly for years.
A SIP typically trails a lumpsum in a steadily rising market because money is deployed later.
The calculator assumes one constant return, so it cannot capture real market sequence risk.
Most investors lack a large idle sum, making the lumpsum option theoretical for them.

Tips

1If you have a windfall, weigh a lumpsum against staggering it over 3–6 months to soften timing risk.
2Use an STP from a liquid fund to phase a large amount into equity without leaving it idle.
3Keep the assumed return conservative — comparing at 10–12% is more realistic than 15%+.
4For recurring income, a SIP is the natural fit; reserve lumpsum for genuine surplus cash.
5Match the horizon to your goal — longer periods widen the lumpsum’s compounding lead.

Frequently asked questions

Everything you need to know about the Lumpsum vs SIP Calculator.

Is a lumpsum or a SIP better?

Mathematically, if returns are positive over the horizon a lumpsum wins because the whole amount compounds from day one. A SIP wins mainly when the market falls after you invest and recovers later, because your later instalments buy in cheaper. The right choice depends on how much money you have available now and your tolerance for timing risk.

Why does the lumpsum usually show a higher maturity value here?

This calculator assumes a single constant return every year. Under that assumption the lumpsum has its full amount compounding for the entire period, while the SIP’s later instalments compound for only a few months. So the lumpsum almost always ends up larger — the SIP only overtakes it in real life when the market dips and recovers.

Does that mean I should always invest a lumpsum?

Not necessarily. Most salaried investors do not have a large sum lying idle — their SIP is funded from monthly income they simply do not have upfront. For them a SIP is the realistic option. A lumpsum only helps if the money is genuinely available today and would otherwise sit in a low-yield account.

What is timing risk and how does a SIP reduce it?

Timing risk is the chance you invest a large sum right before a market fall. A SIP spreads purchases across many months and market levels, so no single entry point dominates your cost. This rupee-cost averaging cushions the impact of a badly timed entry, at the cost of some upside in a rising market.

How is the monthly SIP amount derived from the total?

The calculator divides your total investment by the number of months in the horizon (years × 12). So ₹12 lakh over 10 years becomes a ₹10,000 monthly SIP. This keeps the total money invested identical for a fair comparison.

Do both paths use the same return rate?

Yes. To isolate the effect of timing, both the lumpsum and the SIP are grown at the same assumed annual rate. In reality the two can experience different sequences of returns, which is exactly why the outcome can differ from this idealised estimate.

When would a SIP actually beat a lumpsum?

A SIP outperforms when the market falls soon after you would have invested the lumpsum and then recovers — your monthly instalments accumulate units at lower prices during the dip. In flat or volatile-but-sideways markets the two finish close together; in a steady bull run the lumpsum leads.

Can I do a hybrid of both?

Yes, and many investors do. A common approach is to park a lumpsum in a liquid or arbitrage fund and set up a Systematic Transfer Plan (STP) that moves a fixed amount into equity each month. This gives lumpsum-style deployment discipline with SIP-style averaging.

Does taxation differ between lumpsum and SIP?

The tax rate is the same, but the holding period is measured per purchase. A lumpsum has one purchase date, so the whole gain becomes long-term after 12 months. Each SIP instalment is a separate purchase, so its most recent instalments may still be short-term when you redeem.

Are the results guaranteed?

No. Both figures are estimates based on a constant assumed return. Actual mutual fund returns vary year to year, and the real gap between lumpsum and SIP depends entirely on the sequence of market returns during your holding period.

Methodology & sources

How the Lumpsum vs SIP Calculator is calculated, and where the underlying rules come from.

How we calculate it

Every result is produced by a single, shared and tested financial-formula library used across the whole site — so the maths is consistent from one calculator to the next. Figures are estimates based on the inputs you enter and standard assumptions (such as regular compounding and constant rates); real-world outcomes vary with taxes, fees and changing rates. All calculations run in your browser — nothing you type is stored or sent to a server.

Sources & references

Editorial policy & disclaimer. FinCalcHub provides free educational tools and estimates — not personalised financial, tax or investment advice. Verify important decisions with a qualified professional. Read our editorial approach, disclaimer and privacy policy.

Last reviewed for accuracy on 27 July 2026.

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