LIC Lumpsum Calculator

LIC Lumpsum Calculator

With lumpsum investment, you can park a large sum of money in mutual fund schemes. The growth of your investment could be projected through freely available online tools like the LIC Lumpsum Calculator.

It uses a compound interest formula to show how your money might grow over time, aiding in planning for retirement, education, or other major life events.

What is the LIC Lumpsum Calculator?

The LIC Lumpsum Calculator is an online tool that provides an estimate of potential returns on your lumpsum investment by taking into account the invested amount, expected rate of return, and the length of the investment.

It enables investors to model various scenarios and assess how their investment could potentially perform in different mutual fund schemes or other financial instruments. This helps in determining the best strategy to achieve your financial goals.

How does the LIC Lumpsum Calculator work?

To get accurate estimates of your lumpsum investment, the LIC Lumpsum Calculator uses the following information:

• The principal or the amount you wish to invest
• The tenure of the investment
• The expected rate of return

Based on these factors, the LIC Lumpsum Calculator provides you with the potential maturity return, including the interest earned.

What is the formula used by the LIC Lumpsum Calculator to calculate mutual fund returns?

To determine the potential returns on a lumpsum investment, the LIC Lumpsum Calculator uses the following formula:

A = P(1 + r/n)^(nt)

Here:

• A is the potential maturity value of the investment
• P is the amount of money invested or the principal
• r signifies the yearly interest rate
• t is the tenure of the investment in years
• n is the number of compounding periods per year

Benefits of Using the LIC Lumpsum Calculator

• By investing a large amount in one go, you can capitalise on market upswings more effectively.
• Lumpsum investments are particularly suitable for long-term investments, such as those lasting 10 to 15 years, where the compounding effect can significantly boost returns.
• It offers the convenience of making a single large investment instead of worrying about monthly contributions, which might sometimes be missed.