This calculator projects the future value of a monthly SIP or a one-time lumpsum investment using two standard compound-interest formulas. Enter an amount, a time horizon and an expected annual return, and it shows the projected value, how much of that is your own contribution, and how much is compounding — before tax and fees.
- SIP formula: FV = M × ((1+i)n − 1)/i × (1+i), compounded monthly.
- Lumpsum formula: FV = P × (1+r/100)Y, compounded yearly.
- Worked example: ₹50,000/month for 15 years at 12% p.a. → ₹2.52 Cr projected, ₹90.0 L invested, a 2.80× multiple.
How the projection is calculated
SIP: annuity-due, compounded monthly
A SIP is a fixed instalment paid every month, so the calculator uses the annuity-due version of the compound interest formula — each instalment is treated as invested from the start of its month, then compounded monthly for the remaining months on the horizon.
- M — the monthly instalment
- i — the monthly rate, i = r / 1200, where r is the annual rate you set as a percentage
- n — the number of instalments, n = 12 × years
Lumpsum: compounded yearly
A lumpsum is a single deposit, so the calculator uses the standard annual compounding convention — the whole amount grows at the same yearly rate for every year of the horizon.
- P — the amount invested on day one
- r — the assumed annual return, as a percentage
- Y — the number of years on the horizon
What this projection assumes
Four assumptions apply to every figure the calculator shows, in both modes:
- Nominal returns — the rate you set is not adjusted for inflation.
- Pre-tax — no capital gains tax is deducted from the projected value.
- Pre-fee — no expense ratio, advisory fee or transaction cost is subtracted.
- Constant rate — the same annual rate is assumed for every year of the horizon; real markets do not return the same amount every year.
Worked example: ₹50,000 a month for 15 years
At the calculator's own defaults — ₹50,000 invested every month for 15 years at an assumed 12% annual return, compounded monthly — the projected value is ₹2.52 Cr. Of that, ₹90.0 L is money actually paid in across the 180 instalments, and the remaining ₹1.62 Cr is compounding. Together that is a 2.80× multiple on the amount invested, before tax and fees. Move any of the three sliders above and the same formula recalculates instantly.
SIP vs lumpsum, side by side
Both formulas compound the same way at their core — growth on growth — but they differ in how the money enters the market and how that changes the shape of the risk.
| Aspect | SIP | Lumpsum |
|---|---|---|
| How money enters the market | Fixed amount every month, spread across the whole horizon | The entire amount, invested on a single day |
| Compounding used here | Monthly, annuity-due (i = r/1200, n = months) | Yearly (r = annual rate, Y = years) |
| Rupee-cost averaging | Each instalment buys in at a different price, smoothing the average entry price across ups and downs | One entry price — no averaging effect |
| Timing risk | Spread across many entry points, so a single bad month matters less | Outcome is more sensitive to the market level on the day of investment |
| Average time in the market | Shorter than the full horizon — later instalments have less time to compound | The full horizon — the whole amount is invested from day one |
| Best suited to | Ongoing income — salary, business cash flow | A sum already in hand — bonus, inheritance, sale proceeds |
| Ongoing discipline required | Yes — a contribution every month | No — one decision, then nothing further to do |