₹10 lakh lump sum outperforms ₹10,000 monthly SIP over 100 months, study shows

Lump Sum vs SIP: Which Investment Strategy Yields Greater Wealth?AI Quick ReadMany investors wonder whether investing a large amount upfront or spreading the same investment through SIPs creates more wealth. In such a case, let's check how your corpus grows for both approaches when the total investment, duration, and expected returns remain identical. Her's a comparison

A lumpsum investment is a strategy where you invest a single, large sum of money all at once, rather than breaking it up into smaller, periodic payments. It is commonly used when you receive a financial windfall, such as a bonus, inheritance, or large accumulated savings.

A Systematic Investment Plan (SIP) is an investment method where you regularly contribute a fixed, usually small amount of money into mutual funds. It automates your investments, allowing you to build wealth over time without the need to time the market

Now, let's see whether a lump sum investment or a SIP can create a larger corpus when the total amount invested is the same. In one case, the entire amount is invested upfront as a one-time investment, while in the other, the same amount is deployed gradually through regular SIP instalments over the investment period.

Suppose your fixed deposit (FD) matures and you receive ₹10 lakh as the maturity amount. Instead of reinvesting it in another FD, you decide to invest the entire amount in a mutual fund

In the second scenario, you choose to invest ₹10,000 every month through a Systematic Investment Plan (SIP) as your salary comes in.

In both the cases, you invest for 100 months or 8.3 year and let's assume that in both cases the rate of return is 12%. Accorrdingly:

A lump-sum is more suitable when you have a large amount ready to invest, such as an FD maturity, bonus, or inheritance, and have a long investment horizon. SIPs, on the other hand, are generally better for salaried individuals who invest gradually from their monthly income.

Sanchari Ghosh is an Assistant Editor at Mint with over 12 years of experience in journalism, specialising in personal finance, DLT & DeFi, geopolitics and foreign policy, with a particular emphasis on how these areas intersect. <br> She writes extensively about how money works in everyday life—helping readers navigate personal finance decisions. <br> As AI reshapes investing behaviour, capital is increasingly flowing into decentralized ecosystems, redefining how assets are managed, traded, and valued. She focuses on explaining how money flows within frameworks like Distributed Ledger Technology (DLT), DeFi protocols, and crypto markets—while also exploring what the future of money could look like in a trustless, programmable financial world. <br> She also focuses on immigration-related issues, simplifying complex topics around visas, passports, overseas financial planning, and the many practical challenges Indians face while moving or living abroad. <br> Alongside personal finance, Sanchari has a strong understanding of international politics, contemporary and historical conflicts, and global state decisions. She closely tracks how geopolitical developments influence economies, markets, and individual financial choices, bringing together finance and global affairs in her reporting. <br> She began her career as a desk editor, which gave her a strong foundation in news writing. Over time, her interest naturally shifted toward personal finance. Before joining Mint in 2020, she worked DNA, The Times of India, Outlook Money, BloombergQuint, and ETMoney. At Mint, she got an opportunity to expand her coverage to include immigration and geopolitical developments while continuing to closely follow personal finance trends and market movements.As a journalist, she is committed to accuracy, intellectual rigour, and fairness. <br> She is an English Major and her work took her across cities including Delhi, Mumbai, and Pune. Living independently from an early age gave her firsthand experience in managing life and money on her own. This practical exposure sparked her strong interest in personal finance. <br> Outside the newsroom, Sanchari is a sports enthusiast who regularly plays lawn tennis and squash. In her younger years, she was also a national-level badminton player.

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