Hello readers! Today we are going to discuss on how we can calculate our mutual fund return and understand the return on investment. As we have committed that at financehelps.in we will help you learn the tricks through which you can be financially healthy and save some amount of your income for future requirements. In this article we are providing mutual fund calculator in excel, through which you can not only calculate your return on investment via sip but also the return expected via lumpsum investment. Also we are going to explain you the procedure by using a simple example for easy understanding.

SIP Calculator

Other Calculators

Mutual Fund Calculator in Excel:

Mutual Fund Calculator in Excel [DOWNLOAD–sip calculator & mutual fund Lumpsum calculator].

Now let me explain you how can you calculate the following:-

Firstly you need to fix up an amount which you would require after a certain period .In our case we are considering that Mr.X needs 6, 00,000/- after 5 years for buying a car for her family. Now she is confused how she can generate such a huge amount after 5 years. Also she is confused what to do whether she should go for SIP or she should invest a lumpsum amount. So today we are going to solve this confusion of Mr.X

Let’s understand the amount she will receive after 5 years if she makes a lumpsum investment.  Assuming that she has a bulk amount of 3,50,000/-.Now if she invests 3,50,000 in a mutual fund and we  consider the rate of interest on the mutual fund would be around 12% .On calculating the same we find that she will receive an amount of 6,16,820 after 5 years .Snap for the calculation attached below:-

In the following image attached below the terms represent the following:-

P-Principal (value invested)

r- Rate of Interest or rate of return or compound annual growth rates

t -Time period

A-Amount of return (This is the total amount which one would get after the end of the term of investment)

Return on investment or amount of return (A) = 350000 x {1+ (12/100)}^5

= 350000 x 1.762341683

=6,16,820

SIP Calculator in Excel:

Download the SIP Calculator in excel.

Now let’s see what return she would get if she makes an sip investment in mutual fund. Let’s assume she starts a SIP Investing 8,000/- pm for a period of 5 years rate of interest which we will consider will remain same as 12% p.a. Now on calculating the same what interesting  we find is that the amount of return on the investment is somewhere close to 6,59,891/-.Snap of the calculation attached below:

Now to make your understanding more clear on this we have created a comparison table .

FAQ:

What is lumpsum investment and SIP investment in mutual Funds?

Lumpsum investment is a way of investing a bulk amount in a go to any specific fund. Sip means investing a certain small amount of money on a monthly basis or in on a periodic basis as per ones convenience in a specific mutual fund

What do you mean by power of compounding?

Power of compounding means the profit earned on the principal amount gets added and next interest is calculated of the total amount i.e. the amount invested plus the return on investment resulting in getting interest on interest.

Is lumpsum mutual fund good?

Every investment has some level of risk, similarly Lumpsum also have the risk level but lumpsum Mutual Fund is a good option only of you have spare amount to invest also you don’t have to keep track of monthly fund investment.

Is it better to put lump sum or monthly?

If you have bulk amount for investment then you can go for Lumpsum investment but you have to think about risk diversify. If you are thinking for periodic investment then SIP is the one of the option that you can do. 

Which time is best for Lumpsum?

You have to analyze the market situation (share market), and need to compare the different Mutual fund plan for better understand and performance of MF. Before investing on the mutual fund, we believe that following points need to be considering;

• Current share market scenario.
• Analysis on MF based on data, performance factor, compare the MF and then select the best one. 

What are disadvantages of lump sum investing?

Market volatility has greater impact of lumpsum investment.

How to start SIP?

We have published a post on it, to know details read more..

How do you calculate return on mutual funds?

You can calculate return on mutual funds through the calculator which we have created .Just put in the values and you get the return value. Download the excel mutual fund return calculator from the above given link.

Hope with these information you would have got better clarity of how to invest .Also we have tried covering up all the questions which arise into ones mind as soon as they think of making an investment. If you still have any queries on the related topic reach through us .We are more than happy to help you and make you financially healthy.

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