# How To Calculate Your Returns on Lumpsum Investment? Technological advancement now allows you to compute your lumpsum returns in a jiffy through the lumpsum calculator. An online lumpsum calculator is a tool that assists you to calculate the value of a lumpsum investment in mutual funds. This tool typically asks you to input your investment amount, investment duration in years, and expected return rate per annum. Also, this can assist you to understand if your mutual fund investment through the lumpsum route will fulfill your crucial financial goals.

A mutual fund lumpsum calculator is an ideal and easy way to estimate your overall corpus. By inputting the lumpsum amount, investment duration, and estimated return rate, you can easily know the approximate investment returns in seconds. Also, you can tweak any of the 3 inputted parameters to know how your overall returns might change. A few of the benefits of using the lumpsum calculator are:

·       It shows the estimated return value of the investment in just seconds. However, it is crucial to remember that results provided by lumpsum return calculators are just estimates as mutual funds do not offer fixed returns.

·       It is a handy online tool to know if you can meet your financial goals by investing in a specific mutual fund.

·       It can be used to compare return values of different mutual fund schemes to select the one that mitigates your requirements.

How can you use the lump sum mutual fund investment calculator?

A lump sum calculator can be used to estimate the return on your mutual fund investment. For example, if you want to invest in a mutual fund a lump sum amount of Rs 60,000 for 7 years at an assumed return of 12 percent, you will have to place these details on their respective boxes in the calculator, to arrive at the result. Your estimated return will quickly calculate to Rs 72,641 and your overall maturity amount will compute to Rs 1.33 lakh.

What is the lump sum formula to compute your mutual fund returns?

While lumpsum mutual fund return value on investment depends on the market performance, all lumpsum calculators use a formula to compute the returns on lumpsum investments. Your return is estimated using the compound interest formula.

The formula used is:

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

Wherein,

A = estimated return

P = Present value of invested amount

r = estimated return rate (%)

t = overall investment duration

n = number of times the interest is compounded

For instance, if you take the above example – a lumpsum investment of Rs 60,000 in mutual funds for a tenure of 7 years and an expected return rate of 12 percent. Here, the interest is compounded annually.

Formula for lumpsum investment calculation can be used this way:

A = 60,000 {(1 + 00.12/1) ^ 7}

A = 60,000 X 2.2107

A = Rs 1.33 lakh

However, in place of using this lump sum formula to compute lumpsum investment, you can use the calculator to get the result in seconds. Doing so will not just help you save time but also arrive at a decision quickly.