A SIP Calculator illustrate how regular monthly investments may grow over time, while a lump sum calculator show how a one-time investment may increase over the years.
In this comparison, the monthly SIP reaches a value above ₹1 crore earlier, but it also involves a much higher total contribution over the investment period.
The comparison looks at two different ways of building a corpus. The first involves investing ₹10,000 every month through a systematic investment plan. The second involves investing ₹5 lakh once and allowing the amount to compound over time.
Both calculations assume an annualised return of 12%. However, the investment pattern is different. The SIP receives fresh contributions every month, while the lump sum depends entirely on the original ₹5 lakh and the returns earned on it.
This distinction is important because the result is not simply a contest between SIP and lump sum investing. It is a comparison between two different cash flow structures.
In the first scenario, ₹10,000 is invested every month for 21 years. The assumed annualised return is 12%.
Monthly SIP: ₹10,000
Investment period: 21 years
Assumed annualised return: 12%
Total amount invested: ₹25,20,000
Estimated returns: ₹88,66,742
Estimated corpus after 21 years: ₹1,13,86,742
The total contribution over 21 years comes to ₹25.20 lakh. At the assumed return, the estimated gain from compounding is ₹88.67 lakh, taking the final value to nearly ₹1.14 crore.
Based on the calculation, the SIP corpus is close to ₹1 crore after 20 years and moves above the target during the following year. At the end of 21 years, the corpus is comfortably above ₹1 crore.
In the second scenario, ₹5 lakh is invested once and allowed to grow for 27 years at an assumed annualised return of 12%.
Initial lump sum: ₹5,00,000
Investment period: 27 years
Assumed annualised return: 12%
Total amount invested: ₹5,00,000
Estimated returns: ₹1,01,62,440
Estimated corpus after 27 years: ₹1,06,62,440
The initial investment remains unchanged at ₹5 lakh. No additional money is added during the 27-year period. At an assumed return of 12%, the amount grows to about ₹1.07 crore.
The estimated return of ₹1.02 crore is much larger than the original investment. This demonstrates the effect of allowing a lump sum to remain invested for a long period.
The lump sum takes longer to reach ₹1 crore because the starting capital is limited to ₹5 lakh and there are no further contributions. The entire journey depends on the original amount multiplying through compounding.
At a 12% annualised return, ₹5 lakh needs to grow about twenty times to become ₹1 crore. Achieving this level of growth naturally requires a long investment period.
By comparison, the SIP keeps adding ₹1.20 lakh every year. These regular contributions increase the capital base and help the corpus reach the target earlier.
Read More: SIP Calculator: Can ₹35,000 a Month Build a Retirement Corpus of Over ₹12 Crore?
Based on the stated assumptions, the ₹10,000 monthly SIP reaches a corpus above ₹1 crore faster than the ₹5 lakh lump sum. The SIP reaches about ₹1.14 crore in 21 years, while the lump sum grows to about ₹1.07 crore in 27 years.
The faster result in the SIP scenario is mainly due to regular monthly contributions, which raise the total invested amount to ₹25.20 lakh. The lump sum scenario begins with only ₹5 lakh and depends on compounding for a longer period.
Read stock market news in Hindi. Head to Angel One's share market news in Hindi for comprehensive coverage.
Disclaimer: This blog has been written exclusively for educational purposes. The securities or companies mentioned are only examples and not recommendations. This does not constitute a personal recommendation or investment advice. It does not aim to influence any individual or entity to make investment decisions. Recipients should conduct their own research and assessments to form an independent opinion about investment decisions.
Mutual Fund investments are subject to market risks, read all scheme-related documents carefully.
Published on: Jul 14, 2026, 5:34 PM IST
Team Angel One
We're Live on WhatsApp! Join our channel for market insights & updates
Get the link to download the App
