Lump Sum Investment: One Time 9 Lakh Investment! Will You Get Nearly 50 Lakhs in 15 Years? FD or Mutual Fund – Where is the Profit Higher?
Lump Sum Investment: Many people receive a lump sum amount at some point in their lives. It could be retirement benefits, a share of ancestral property, or a substantial bonus. Investing this large sum of money in the right place is a major challenge. Many wonder, should I keep this money in an FD, buy gold, or lean towards mutual funds? The real question is, if you have Rs 9 lakh today and invest it for 15 years, is it possible for it to turn into Rs 50 lakh?
In the world of investing, risk and reward always go hand in hand. The biggest advantage of a lump sum investment is that you start earning returns on the entire amount from day one. While lump sum investments might seem risky during market downturns, they have the potential to deliver incredible returns over the long term. Today, through a comparative discussion, we will see which of the three—Fixed Deposits (FD), Gold, and Mutual Funds—can take you from Rs 9 lakh to the target of Rs 50 lakh in 15 years.
Investment Goal and Reality
Let’s assume your current investable amount is Rs 9 lakh and your goal is to create a corpus of Rs 50 lakh after 15 years. For this, we will calculate based on historical or expected return rates of three popular instruments.
Comparative Calculation Table:
| Investment Instrument | Expected Interest Rate | Estimated Profit After 15 Years | Total Corpus Value |
|---|---|---|---|
| Fixed Deposit (FD) | 7% | Rs 15,83,128 | Rs 24,83,128 |
| Gold | 10% | Rs 28,59,523 | Rs 37,59,523 |
| Mutual Funds (MF) | 12% | Rs 40,26,209 | Rs 49,26,209 |
Analysis: Who is Ahead, Who is Behind?
Looking at the table above, it is clear that while FDs or Fixed Deposits are safe, they lag significantly in terms of profit. Assuming a 7 percent interest rate over 15 years, Rs 9 lakh will grow to only around Rs 24 lakh, which is less than half of the Rs 50 lakh target.
On the other hand, Gold is a safe and popular medium. Assuming an average return of 10 percent, your Rs 9 lakh could grow to approximately Rs 37.5 lakh in 15 years. This is better than FDs but still falls short of touching the magic figure of Rs 50 lakh.
Finally, we have Mutual Funds. If we assume an average return of 12 percent (which is quite common in the long-term history of the stock market), it appears that after 15 years, your Rs 9 lakh could turn into approximately Rs 49.26 lakh. That means it gets incredibly close to your target of Rs 50 lakh.
Risk vs Reward
Although Mutual Funds are the clear winner here, it is essential to remember that market risks are involved. When the stock market is bullish, Mutual Funds or equity deliver the best returns. Conversely, when the market is volatile, Gold acts as a strong ‘hedge’ or shield. While FDs offer guaranteed returns, they often fail to grow real wealth effectively when battling against inflation.
Therefore, before investing, it is crucial to assess your risk appetite. Instead of putting all eggs in one basket, diversifying your portfolio might be a wise decision.
Disclaimer: This article is for informational purposes only and does not constitute financial advice. Investments in mutual funds or the stock market are subject to market risks. Please consult a government-certified Financial Advisor before making any investment decisions.
