### HOW MUCH WILL YOUR INVESTMENTS BE WORTH AFTER 10 YEARS

As an investor, the most inquisitive question would be how much worth will one’s investment be after, say 10, years? One needn’t be an expert in the field of math or even investment to find that out. This article will act as a guide against sip vs lumpsum investment.

Suppose, we want to calculate the future value of ₹2 lakh invested at 15% rate of return, after 10 years

There are two methods to calculate this. You can either do it on a paper with a pen if you fancy being vintage or there is always a trusted internet website waiting to ease your senses. Both the methods are discussed step wise and in detail below:

Fan of paperwork  :-

There are two possible avenues, Lumpsum investment and SIP investment

1. Lumpsum investment

The formula is :

FV= PV x (1+r%)^n

FV= Future value,

PV= present value of your investment = ₹2,00,000

r= rate of return =15

n= time period of investment = 10 years

Putting the values in the formula,

FV=2,00,000 x ((1+0.15)^10)

FV= ₹8,09,112

1. SIP investment (systematic investment plan)

The formula is:

FV= I x (((1+r%)^n) -1)/r%)

Here,

FV=Future value,

I=Monthly investment = ₹1111

r= rate of return = 15/12 = 1.25 ( divide the interest rate by 12 since its monthly investment)

n= time period of investment = 10 years x 12 months=120

Entering the value in the formula,

FV= 1111 x (((1+0.15)^120)-1)/0.15

FV= ₹751,995

Website savvy :-

1.Lumpsum Investment

The future value of your lumpsum mutual fund investment can be calculated by using a ‘Lumpsum calculator‘. You can find it under the website of any trusted AMC (Asset Management Company) or mutual fund house.

Put the investment amount i.e. Rs 2 lakh under ‘Total investment’ and input the values under the ‘expected rate of interest’ button, i.e. 15%. Input the time period as 15 years. Hit on calculate button. And voila, you won’t have to go through the hustle and hard work  of calculating it on your own.

After putting the values in, the following results will show.

The future value of 2 lakh rupees after 15 years @15% R.O.I will be Rs 8,09,112

1. SIP investment

Future value of your SIP investment can be calculated by using an SIP calculator’. You can find it under the website of any trusted AMC (Asset Management Company)  or mutual fund house.

Put the investment amount, i.e. Rs 1111 under ‘monthly investment’ and input the values under the ‘expected rate of interest’ button, i.e. 15%. Input the time period as 15 years. Hit on calculate button. And voila, you won’t have to go through the hustle and hard work of figuring it on your own.

After putting the values in, the following results will show.

The future value of 2 lakh rupees after 15 years @15% R.O.I will be Rs 751,995

Now, that you know how to evaluate the worth of your mutual funds after a period, invest in mutual funds today to achieve your financial goals. Happy investing!