How is the future value of a lumpsum calculated?

FV = P × (1 + r)^n, where P is the amount invested, r the annual return and n the number of years. The calculator compounds annually by default; switch to monthly compounding for instruments that credit interest monthly.

Compound annual growth rate: the single annual rate that would take the starting value to the ending value over the period. CAGR = (End ÷ Start)^(1 ÷ years) − 1. It smooths out year-to-year volatility, so a fund that went up 40 percent then down 20 percent over two years has a CAGR of about 5.8 percent, not 10.

Lumpsum or SIP, which is better?

A lumpsum invested at the start earns for the whole period, so in a steadily rising market it ends higher. A SIP spreads the entry price and suits income that arrives monthly. The honest answer is that the choice is usually dictated by when the money is available, not by which is mathematically superior.

Is the return guaranteed?

No. The calculator applies whatever rate you enter. For fixed deposits or bonds the rate is contractual; for equity and mutual funds it is an assumption.

How is a lumpsum investment taxed?

Depends on the instrument. Equity and equity funds: 12.5 percent long-term above ₹1.25 lakh a year after 12 months, 20 percent short-term. Debt funds and FDs: at your slab rate. The calculator shows pre-tax values.

Lumpsum & CAGR Calculator

Future value of a one-time investment, or the compound annual growth rate between two values.

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Calculate

Amount invested (₹)

₹

Expected annual return

Compounding

Period

years

Projection

Invested

₹ 1,00,000

Gain

₹ 2,10,585

Future value

₹ 3,10,585

Illustrative only. Returns on market-linked instruments are not guaranteed. Values are pre-tax and in nominal rupees.

How it works

Future value

P × (1 + r)^n. Switch to monthly compounding for instruments that credit interest every month.

CAGR

(End ÷ Start)^(1 ÷ years) − 1. The one steady rate that explains the growth.

Compare fairly

Use CAGR, not absolute return, to compare investments held for different periods.

One-time investment, two questions

Forwards: what does this amount become at this return over this period. Backwards: what annual rate turned this starting value into this ending value. The second is the one to use when a fund factsheet or a property sale quotes an absolute return over an odd number of years and you want to know what it was really earning.

Annual or monthly

Monthly compounding gives a slightly higher figure at the same nominal rate.

Absolute vs annualised

Doubling in 5 years is 14.9 percent a year; in 10 years it is 7.2 percent.

Fractional years

Enter 2.5 for two and a half years; the formula handles it.

Pre-tax

Apply the capital gains rate for the instrument on redemption.