Neutral impactEconomy
Rs 10 Lakh Lumpsum Vs Rs 25,000 SIP: Which Can Build A Bigger Corpus In 20 Years?
NDTV Profit 2 hrs ago·5 Sept 2026, 10:00 am
Investors often debate between making a one-time lumpsum investment or spreading their money through a Systematic Investment Plan (SIP). A lumpsum involves investing a large sum, like Rs 10 lakh, all at once. In contrast, a SIP requires investing a fixed amount, such as Rs 25,000, every month. The key difference lies in timing and risk. A lumpsum is exposed to market volatility from day one, whereas a SIP averages out the purchase cost over time, potentially reducing the impact of market fluctuations.
For a 20-year horizon, the power of compounding plays a crucial role. A lumpsum has the potential to generate a larger corpus if the market performs exceptionally well during that period. However, it also carries the risk of significant losses if the market declines shortly after the investment. A SIP, while generally safer due to rupee cost averaging, might result in a slightly smaller final amount if the market sees a prolonged bull run. Ultimately, the choice depends on your risk appetite and market outlook.
Key takeaways
- Category: Economy.
- Assessed as a significant, market-relevant update.
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