Key assumptions
This model assumes one investment made today, compounded at a steady annual return for the entire holding period. There are no additional contributions, withdrawals, taxes, or changes in expected return over time.
Lump Sum Calculator
See how a one-time investment grows — maturity value and inflation adjusted worth in today's money.
Before you invest a lump sum
- 1Don't invest the entire amount at once during market highs — consider a Systematic Transfer Plan (STP) to spread entry over 3–6 months.
- 2Compare after-tax returns: equity held over 1 year has different tax treatment than debt or fixed deposits.
- 3For amounts above your emergency fund, match investment horizon to goal — equity for 5+ years, debt for shorter periods.
- 4Check if the fund or product has any lock-in period (e.g. ELSS has 3-year lock-in, FDs may have premature withdrawal penalties).
- 5Factor in your existing asset allocation — a large lump sum can skew your portfolio if it all goes into one asset class.
- 6If the money is from a windfall (bonus, inheritance), park it in a liquid fund first while you plan the allocation.
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What is this?
A lump sum investment grows from a single deposit compounded at your assumed annual return. This calculator shows both the maturity value and an inflation-adjusted figure so you can compare outcomes in today's money — helpful for evaluating whether a one-time investment meets a goal like education, a down payment, or retirement.
Formula
Maturity value = P × (1 + r)^n where P is the investment amount, r is the annual return, and n is years. Inflation adjusted value = maturity value ÷ (1 + inflation rate)^n.
How to use
Enter investment amount, expected annual return, time period in years, and assumed inflation rate. Compare the maturity value with the inflation adjusted figure to understand real growth.
FAQ
What is the inflation adjusted value?
It adjusts the future maturity value for inflation so you can understand what the money is actually worth in today's terms — closer to what it could buy in real life.
When should I use lump sum vs SIP?
Use lump sum when you have a one-time amount to invest (bonus, inheritance, sale proceeds). Use SIP when you want to invest smaller amounts monthly from regular income.
Does this include taxes?
No. Use an after-tax return assumption or consult your local tax rules — taxes can significantly change the net outcome.
What return rate should I enter?
Use an expected annual return that matches your asset type (e.g. 6–8% for bonds, 10–14% for diversified equity). Past performance does not guarantee future results.
How accurate is the inflation adjustment?
It applies your inflation input as a steady rate — real inflation varies year to year. Treat the inflation adjusted figure as directional, not exact.
Deeper guide
Use these notes to stress-test the calculator, understand what drives the result, and choose the right tool for the decision you are making.
Worked example
A one-time investment of 5 lakh at 10% for 15 years compounds very differently from the same money parked at 6%. Over longer horizons, small differences in annual return create large differences in maturity value because every year's gain also starts earning returns.
How to interpret the result
Compare the nominal maturity figure with the inflation-adjusted value before deciding if the investment actually supports your goal. A large nominal number can still disappoint if inflation has eroded most of its purchasing power.
When to use this vs Compound Interest
Use Lump Sum when you want a simple long-term projection with inflation context for an investment corpus. Use Compound Interest when the compounding frequency itself matters, such as fixed deposits or products with monthly or quarterly accrual.