SIP vs lumpsum vs FD vs RD
Same money, same years: four ways to put it to work.
With the same money and assumed return, a lumpsum ends higher than a SIP because it is all invested from day one. With ₹12,00,000 over 10 years: a ₹10,000 monthly SIP at 12% projects about ₹23,23,391, a lumpsum at 12% about ₹39,60,464, an FD at 7% about ₹24,01,917 and an RD at 6.5% about ₹16,89,880.
Projected SIP value
Each option uses ₹12,00,000 in total over 10 years.
For illustration only. Read the assumptions below for the full picture.
Four options, side by side.
| Option | Money goes in | Projected value | Gain |
|---|---|---|---|
| SIP at 12% | ₹10,000 a month | ₹23,23,391 | ₹11,23,391 |
| Lumpsum at 12% | ₹12,00,000 on day one | ₹39,60,464 | ₹27,60,464 |
| FD at 7% | ₹12,00,000 on day one | ₹24,01,917 | ₹12,01,917 |
| RD at 6.5% | ₹10,000 a month | ₹16,89,880 | ₹4,89,880 |
Understand your result.
Compare four ways to put the same money to work over the same number of years: a monthly SIP, a one-time lumpsum, a fixed deposit and a recurring deposit. Every option uses the same total amount, so the difference comes from timing and the rate assumed for each.
A lumpsum or FD puts the whole amount in on day one, so it has more time to grow than a SIP or RD that spreads the money across the years. That timing gap is often bigger than the rate gap. A lumpsum only applies if you actually have the full amount today, and a market-linked SIP or lumpsum can return less than an FD in a given period.
A worked example.
Using this calculator’s default inputs, projected sip value is ₹23,23,391. This is an illustration of the stated formula, not a forecast.
See the example inputs
| Monthly amount (SIP and RD) | ₹10,000 |
|---|---|
| Time period | 10 years |
| Assumed annual return for SIP and lumpsum | 12 % |
| Annual FD interest rate | 7 % |
| Annual RD interest rate | 6.5 % |
A common mistake to avoid
Comparing a market return assumption with a bank rate as if both were certain.
Questions you might have.
Is SIP or lumpsum better?
With the same total amount and the same constant return, a lumpsum ends higher because the money is invested for longer. A SIP suits money that arrives monthly from income, and it spreads the entry price across market ups and downs. This comparison illustrates the arithmetic; it does not recommend either option for you.
Is a SIP better than an FD?
It depends on the return you assume and the risk you can take. At an assumed 12% equity return, ₹10,000 a month for 10 years projects about ₹23,23,391, close to an FD of the same ₹12,00,000 at 7%, about ₹24,01,917, because the FD money is all invested on day one. FD interest is fixed for the term; equity returns are not.
SIP vs RD: which grows more?
Both put in the same amount each month, so the difference is the rate. ₹10,000 a month for 10 years projects about ₹23,23,391 in a SIP at an assumed 12% and about ₹16,89,880 in an RD at 6.5%. The RD rate is fixed by the bank; the SIP return is not guaranteed and can be lower or negative.
Why do lumpsum and FD use the full amount on day one?
So every option uses the same total money. The total is the monthly amount × 12 × years. If you do not have that sum today, the lumpsum and FD lines are not available choices for you, and the SIP and RD lines are the fair comparison.
Are taxes included?
No. Results are before income tax, TDS on deposit interest, capital gains tax, exit loads and fund expenses, which differ between options and can change the ranking.
Why does lumpsum beat SIP in this comparison?
With the same total and the same assumed return, a lumpsum invests everything from the first day, while a SIP adds money gradually. The earlier money has longer to compound. In real markets, returns are not constant, so the order and size of returns can change the result.
Are the FD and RD rates live bank offers?
No. They are rates you enter. Check the current rate, compounding and payout terms with your bank, and remember that interest is taxable and may attract TDS.
Prepared by INDwise · Calculation checks: 29 October 2026How we check the maths · Report a correction
How we calculate it
Total amount = monthly amount × 12 × years. SIP and RD put in the monthly amount at the start of each month; lumpsum and FD put the total in on day one. SIP and lumpsum compound monthly at annual return ÷ 12. FD compounds quarterly. RD uses the monthly equivalent of quarterly compounding. Each line uses the same formula as the matching INDwise calculator.
Assumptions & things to know
Constant illustrative returns and rates. Lumpsum and FD assume the whole amount is available on day one, so they have more time to grow; this compares timing as well as rates. Market returns vary and are not guaranteed. Before tax, TDS, exit loads and fees.
Your privacy & sharing
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