SIP vs Lumpsum Comparison

If you will invest ₹10,000 a month for 10 years, that is ₹12 lakh of cash either way. A SIP at 12% in this model grows to about ₹23.23 lakh. Putting the whole ₹12 lakh in on day one at the same 12% grows to about ₹37.27 lakh in the comparison line — because the lumpsum had ten full years on every rupee. Real markets punish that lumpsum if day one was a peak.

The cash-flow question

This is the argument happening in every WhatsApp investment group in Bengaluru. IndiaKit shows both engines with the same monthly amount, rate and years so the mechanical advantage of early capital is visible, and so the risk of bad timing is discussed in the limits, not hidden.

The maths on this page

SIP value uses the monthly annuity (same as the SIP tool) ≈ ₹23,23,391. Lumpsum equivalent invests monthly × 12 × years = ₹12,00,000 immediately and compounds annually at the same rate ≈ ₹37,27,018. Total invested is ₹12 lakh in both stories only if you actually have ₹12 lakh on day one.

Most salaried people do not have the lumpsum; they have a salary. Then SIP is not a philosophy, it is a cash-flow fact.

Sequence of returns can make a SIP win in a crashing-then-recovering market. This page does not simulate sequences; it uses a flat rate.

₹10,000 a month versus ₹12 lakh on day one

Deepa in Bengaluru can either SIP ₹10,000 or, if she had it, invest ₹12 lakh at once. At 12% for 10 years the page shows SIP ≈ ₹23.23 lakh and lumpsum ≈ ₹37.27 lakh. She does not have ₹12 lakh, so she SIPs, and she does not pretend the lumpsum line is her life.

What a bank still has to confirm

Flat expected return. No crash scenario. The lumpsum line assumes you already hold the full ₹12 lakh. Not a recommendation to borrow and invest.

Common questions

Why is lumpsum so much higher here?

Because every rupee compounds for the full 10 years. SIP rupees that arrive in year 9 barely grow. The gap is time in the market in a flat-return cartoon.

What if the market falls 30% next month?

A fresh lumpsum would fall 30% on the whole pile. A SIP would buy cheaper units later. This calculator cannot show that path; it is the reason people still SIP even when the cartoon favours lumpsum.

Are the rates the same as the SIP tool?

Yes — default ₹10,000, 12%, 10 years. The SIP maturity matches the SIP page on purpose.