Lumpsum vs SIP Comparison
If you have ₹X to invest right now, should you go all-in today or spread it across monthly SIPs? Run both honestly.
Your numbers
Your result
At 12% over 10 years on ₹12 lakh, lumpsum (invest it all today) grows to ₹37.27 lakh. SIP (spread across ₹10,000/month for 120 months) grows to ₹23.23 lakh. Lumpsum wins by ₹14.04 lakh. The honest reason: lumpsum gets the full 10 years of compounding from day one; SIP only gets full compounding on the first month's contribution.
- Total invested (both)
- ₹12 lakh
- Lumpsum value at maturity
- ₹37.27 lakh
- SIP value at maturity
- ₹23.23 lakh
- Equivalent monthly SIP
- ₹10,000
- Lumpsum advantage
- ₹14.04 lakh
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Plan your monthly SIP from here
If you go the SIP route, plan it properly with a 10% annual step-up. The step-up nearly doubles the final corpus over 20 years.
Open it
Why this question is wrong half the time
Most "lumpsum vs SIP" content compares apples to oranges. A monthly SIP commits ₹10k for 10 years (₹12 lakh total). A lumpsum commits ₹12 lakh today. The SIP has lower money-on-the-table at all times because contributions are spread out, so it has less compounding mass. Calling this "SIP loses" is misleading, the question is what you do with the money you have NOT yet committed to the SIP. If it sits in your savings account at 3 percent, then yes SIP loses. If it sits in a liquid fund at 7 percent and gets STP'd into equity, the gap shrinks materially.
The actual rule
- If you have a windfall (bonus, inheritance, RSU vest): do an STP. Move the money to a liquid fund today, then STP into equity over 6-12 months. Captures most of the lumpsum advantage; protects against immediate crash regret.
- If you have a regular salary: SIP is the only honest answer. You do not have a lumpsum to invest, you have monthly cashflow.
- If the market is at all-time highs and you are nervous: longer STP (12-18 months) instead of lumpsum.
- If the market has just crashed 20%+: lumpsum hard. The probability of further drops decreases sharply at those levels and compounding from the bottom is enormously valuable.