Wealth-Optimal Mix

Loan vs Lumpsum Calculator

Find the wealth-optimal mix of loan and cash using your expected investment returns.

Inputs

Summary

Best Strategy—
Winning Loan %—
Best End Wealth₹0
Difference vs Next Best₹0

Decision Insight

Run the calculation

Adjust inputs to see the wealth-optimal mix and a quick insight.

Charts

Scenario Comparison

Loan Amount Taken Upfront Payment Monthly EMI Lumpsum Invested SIP Invested Total Amount Paid Final Lumpsum Asset Final SIP Asset Total Growth Total Asset Profit/Loss

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What this calculator does

This tool compares end-of-tenure wealth for different loan percentages (0% to 100%). It assumes you have full cash available, and evaluates how much wealth you create by investing the unused cash while paying EMI from income.

How it works

EMI follows standard amortization, and investment growth uses monthly compounding of CAGR. Each loan % creates a different invested cash amount and processing fee. The scenario with the highest end wealth is recommended.

  • Monthly investment return: $(1 + CAGR)^{1/12} - 1$
  • EMI formula: $EMI = P \times r \times (1+r)^n / ((1+r)^n - 1)$
  • SIP FV assumes contributions at the start of each month.

Assumptions

  • Processing fee is paid upfront from pocket and applied on borrowed amount.
  • EMI can be treated as income-funded or cash outflow (toggle).
  • Loan % tested in steps of 10%.

FAQs

Should I always take a higher loan if returns are higher? Not always. Processing fees and EMI cashflow matter. This calculator visualizes the full curve.

Why invest SIP when paying full cash? This uses the EMI-equivalent SIP to show the opportunity cost of tying up cash upfront.

Disclaimer

Results are illustrative and do not include taxes or market risk. Last updated: 31 Jan 2026.