How to use a lumpsum and SWP calculator while investing one-time in mutual funds


Lumpsum and SIP are two sides of the same coin as far as investing in mutual funds is concerned. One can take a call as to which way to choose, based on their investment needs and financial conditions. Before elaborating this further, let us first see when it is ideal to make a lumpsum investment.

Substantial savings lying in bank account

If an investor has a good amount of savings ready to be invested, making lumpsum investment, with the assistance of a lumpsum calculator, would be ideal. One can choose mutual fund schemes and invest the money in mutual funds

Windfall gains

When you get a windfall gain in the form of a bonus or a property sale or a maturity of an old investment etc., you can opt for lumpsum mutual fund investment. Generally, a large amount received tends to get invested in discretionary expenses, which do not add to your current wealth. 

To fully utilise tax deduction under Section 80C –

Investments up to Rs. 1.5 lakhs in a year are eligible for tax deduction under section 80C if you invest in ELSS mutual funds. However, people may fail to fully utilise the deduction available due to non-availability of funds at the last moment. In such a scenario, you can invest in lumpsum at the beginning of the year to completely exhaust the section 80C limits

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To get a regular income

one can also invest in lumpsum to avail a regular cash flow via SWP from their mutual fund investment. In this case, one can use a SWP calculator to calculate the returns.  

In order to facilitate these decisions, tools like lumpsum calculator and SWP calculator are freely available on investment websites or AMC websites. Let us see how these calculators work –

Lumpsum calculator

Suppose you want to invest Rs 5 Lakhs for 10 years and want to know the tentative amount that can be expected after the investment period. You just need to input the following in the lumpsum calculator – 1) lumpsum investment amount – Rs 5 Lakhs 2) Period as 5 years 3) Expected return – input the return you expect from the mutual fund schemes you are investing in. In this case, say it is 10%. 

The moment you input the above, the lumpsum calculator will show the future value of your investments as Rs 805,256. The calculations are shown within seconds and helps you in planning your mutual fund investments.

SWP calculator

Suppose you want to invest Rs 10 Lakhs for 20 years and want to withdraw Rs 6,000 monthly. In this case, you can use a SWP calculator and input the following to know the future value of the investments, plus the sustainability of the one-time investment. 1) Lumpsum investment amount – Rs 10 Lakhs 2) Period as 20 years 3) Expected return 9% 4) monthly SWP amount as Rs 6,000. 

Within seconds of entering the above, the SWP calculator will show the future value of your investments as Rs 19,71,775, total SWP withdrawal amount as Rs 14,40,000 and the total profit as Rs 24,11,775 (Rs 19,71,775 + Rs 14,40,000). The calculations are shown within seconds and helps you in planning your mutual fund SWP investments. Without the SWP calculator, this complex calculation would not be possible.

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Sometime, while searching for lumpsum calculator, you can also come across a calculator lumpsum SIP calculator. Please ignore this as this will not help you in mutual fund lumpsum investment calculations. 


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