Find out what a one-time investment grows to with compounding, and watch how the growth accelerates in the later years.
Compounding, visualised
A lumpsum investment is the purest demonstration of compound growth: you invest once and every year's return is earned on an ever-larger base. The curve looks flat at first and steep later — at 12%, an investment gains as much in years 13–18 as it did in its entire first 12 years. The practical lesson is that time in the market matters more than the amount: money you can leave untouched for 15–20 years does extraordinary work.
Formula
FV = P × (1 + r)t
- P — amount invested today
- r — expected annual return (as a decimal)
- t — years invested
Worked example
₹1,00,000 invested at 12% p.a. for 10 years: FV = 1,00,000 × (1.12)10 ≈ ₹3,10,585 — your money roughly triples. Leave it another 10 years and it becomes about ₹9.65 lakh; the second decade adds more than twice what the first did, without you investing another rupee.
How to use this calculator
- Enter the amount, expected annual return and holding period.
- The money-multiple tile shows how many times your investment grows.
- Compare with the SIP calculator if you are deciding between investing at once or monthly.
Frequently asked questions
How is lumpsum growth calculated?
With the compound interest formula FV = P × (1 + r)^t, where P is the amount invested, r the annual return and t the number of years. Growth compounds — each year's returns earn returns themselves — which is why the value curve steepens over time.
When is lumpsum investing better than a SIP?
When you already have the money and a long horizon, investing it at once maximises time in the market, which historically beats spreading it out in most periods. SIP-style staggering (or an STP from a liquid fund) is mainly a behavioural cushion against investing a large sum right before a crash.
What is the rule of 72?
Divide 72 by your annual return to estimate how many years your money takes to double. At 12% a lumpsum doubles roughly every 6 years, so ₹1 lakh becomes about ₹2 lakh in 6 years, ₹4 lakh in 12 and ₹8 lakh in 18.
Should I account for inflation in these numbers?
Yes — the output is in future rupees, which will buy less than today's. A quick fix is to use a real return (expected return minus expected inflation, e.g. 12% − 6% = 6%) to see the answer in today's purchasing power, or use our inflation calculator alongside.
How are lumpsum mutual fund gains taxed?
The same as any mutual fund investment: for equity funds, gains on units held over 12 months are long-term and taxed at 12.5% above the ₹1.25 lakh annual exemption; short-term gains are taxed at 20%. Debt fund gains are added to your income. Verify current rates before redeeming, as budgets revise them.