How the Mutual Fund Calculator works
This calculator estimates the future value of a mutual fund investment made either as a one-time lump sum or as a monthly SIP (Systematic Investment Plan). It assumes a constant expected annual return; real mutual fund returns are market-linked and will move up and down over time.
Formulas used
Lump Sum: A = P × (1 + r)t
SIP: FV = P × [ ((1 + i)n − 1) / i ] × (1 + i)
- P = Amount invested (one-time for lump sum, or per month for SIP)
- r = Expected annual return (as a decimal); i = monthly return = r ÷ 12
- t = Years; n = number of monthly instalments = t × 12
Worked examples
Lump sum: ₹1,00,000 invested once at 12% for 10 years grows to 1,00,000 × (1.12)10 ≈ ₹3,10,585 (about ₹2,10,585 of returns).
SIP: ₹10,000 invested every month at 12% for 10 years totals ₹12,00,000 invested and grows to about ₹23,23,391 — roughly ₹11.2 lakh of returns. Because each SIP instalment compounds for a different length of time, SIPs also smooth out market ups and downs (rupee-cost averaging).
Things to keep in mind
- Mutual fund returns are not guaranteed. The expected-return figure here is only an assumption; actual performance depends on the market and the fund.
- Real returns are net of the fund's expense ratio and any exit load, so the amount you receive can be a little lower than a gross projection.
- Gains are subject to capital gains tax that varies by fund type (equity vs debt) and holding period, so check the current tax rules for your fund before redeeming.
