# Lumpsum Calculator

## What is Lumpsum Investment?

A lump sum investment is depositing the entire amount at one go. Lump-sum investment is a popular way of investing in mutual funds. If you invest the entire amount available with you in a mutual fund scheme, it is called the lump-sum mutual fund investment. Lump-sum investing is a common mode of investment for HNIs and big-ticket investors. It is an excellent way of investing in the long-term. An investor who has a high-risk tolerance may consider investing a lump sum amount in a mutual fund scheme. You may consider lump-sum investment for a windfall such as an inheritance, bonus, or a gift. If you get the market timing right, you may profit from the lump-sum investment. It is an ideal investment for the long-run. You must still invest based on your investment goals, risk appetite, and time horizon. Lump-sum investing is not suitable for short-term investment. If you are not confident with handling large amounts of money, you may opt for a systematic investment plan or SIP that staggers investments over some time. It helps you avoid timing the market. Investing a lump sum amount of money depends on the need for funds. Failure to plan for liquidity could mean liquidating assets at a loss.

## What is a Lump sum Calculator?

A lump sum calculator is a utility tool that shows you the wealth gained over the long-term. It is a smart tool to calculate the return on a lump-sum mutual fund investment. A lump sum calculator consists of a formula box, where you enter the investment amount, investment period in years, and the annual rate of return expected on the investment. The lump-sum calculator will show you the expected amount and the wealth gain in seconds.

## How does Lump sum Calculators work?

Lump-sum Calculators work on the principle of future value. The lump-sum calculator tells you the future value of your investment at a certain rate of interest. You must use the mathematical formula: FV = PV(1+r)^n FV = Future Value PV = Present Value r = Rate of interest n = Number of years For example, you have invested a lump sum amount of Rs 1,00,000 in a mutual fund scheme for 20 years. You have the expected rate of return of 10% on the investment. You may calculate the future value of the investment as: FV = 1,00,000(1+0.1)^20 FV = Rs 6,72,750. You have invested Rs 1,00,000 which has grown to Rs 6,72,750. The wealth gain is Rs 6,72,750 – Rs 1,00,000 = Rs 5,72,750.

## How to use the ClearTax Lump sum Calculators?

The ClearTax Lumpsum Calculator shows you the future value of your mutual fund investment in seconds. To use the ClearTax Lumpsum Calculator.
• You must enter the investment amount.
• Fill up the investment duration in years.
• You then enter the annual expected rate of return.
• The ClearTax Lumpsum Calculator will show you the return on your investment. It also displays the wealth gain.

## Benefits of ClearTax Lumpsum Calculator

• The ClearTax Lumpsum Calculator shows you the return on a lump-sum investment in seconds.
• It helps you evaluate if you can reach the financial goal at the end of the investment term.
• It is an excellent tool to find the return on a lump-sum investment in mutual funds.
• It helps you manage finances better as you have an idea of the maturity value of your investments.
• It is easy and convenient for novice investors to calculate the return on their investments.
• You can select investments that may offer return above inflation to achieve investment goals over the long-term.

## FAQs on ClearTax Lumpsum Calculator

• How does the ClearTax Lumpsum Calculator show the Wealth Gain?
You will have to enter the initial lump sum investment amount, expected rate of return and the duration of the investment. The ClearTax Lumpsum Calculator will calculate the wealth gain based on the difference between the initial investment and the return on your investment.
• Can the ClearTax Lumpsum Calculator show the return from mutual fund investment?
Yes, the ClearTax Lumpsum Calculator calculates the return on a lump sum mutual fund investment. You can estimate the wealth creation for a lump-sum investment over a specified period, in a mutual fund scheme of your choice.
• How does the ClearTax Lumpsum Calculator help you achieve the financial goal?
The ClearTax Lumpsum Calculator shows you the return on a lump-sum investment. You may use the calculator to calculate the return on a lump sum mutual fund investment over a period and an expected rate of return. You can select investments that give return above inflation for financial goals such as a child’s education and marriage, retirement planning, or buying a dream house.
• Is the ClearTax Lumpsum Calculator easy to use?
Yes, the ClearTax Lumpsum Calculator is easy to use the tool. You just have to enter the lump sum amount, duration, and the expected rate of return on the investment. The ClearTax Lumpsum Calculator will calculate the return on the investment and the wealth gain in seconds.
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