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Inflation-Adjusted SIP Calculator

Find what your future SIP corpus will be worth in today's rupees after accounting for inflation.

Total invested
₹18,00,000
Estimated returns
₹32,45,760
Maturity value
₹50,45,760
Value in today's rupees
₹21,05,419

Step-by-step working

  1. Nominal FV = ₹50,45,760 (SIP formula)
  2. Real value = 50,45,760 / (1 + 6/100)^15 = ₹21,05,419.35

Mathematical Formula

Nominal FV = P × [((1 + i)^n − 1) / i] × (1 + i); Real value = FV / (1 + inflation)^years.

Overview & Explanation

Inflation reduces purchasing power. Discounting the SIP corpus by expected inflation shows what it will buy in today’s prices.

How It Works

  • Compute the nominal SIP corpus.
  • Divide by (1 + inflation)^years to bring it to today’s value.

Practical Applications

  • Realistic retirement planning.
  • Setting goals in today’s money.

Example 1: ₹10,000/month, 15 years, 12% return, 6% inflation

Typical long-term assumption.

1

Inputs

Monthly SIP amount (₹): 10000 · Expected return (% p.a.): 12 · Investment period (years): 15 · Expected inflation (% p.a.): 6

= entered
2

Step 1

Nominal FV = ₹50,45,760 (SIP formula)

3

Step 2

Real value = 50,45,760 / (1 + 6/100)^15 = ₹21,05,419.35

4

Maturity value

Result

= ₹50,45,760
5

Value in today's rupees

Result

= ₹21,05,419

Example 2: ₹20,000/month, 25 years, 11% return, 5% inflation

A retirement-style plan.

1

Inputs

Monthly SIP amount (₹): 20000 · Expected return (% p.a.): 11 · Investment period (years): 25 · Expected inflation (% p.a.): 5

= entered
2

Step 1

Nominal FV = ₹3,18,11,623.78 (SIP formula)

3

Step 2

Real value = 3,18,11,623.78 / (1 + 5/100)^25 = ₹93,94,060.68

4

Maturity value

Result

= ₹3,18,11,624
5

Value in today's rupees

Result

= ₹93,94,061

How it's calculated & sources

Nominal FV = P × [((1 + i)^n − 1) / i] × (1 + i); Real value = FV / (1 + inflation)^years.

Frequently Asked Questions

Why adjust a SIP for inflation?
A corpus of ₹1 crore in 20 years will buy far less than ₹1 crore today. Adjusting shows the real value of your goal.
What inflation rate should I use?
RBI targets 4% CPI inflation with a band of 2–6%. Many planners use 5–6% for general expenses and higher for education or healthcare.
Is this the same as real return?
Approximately. Discounting the nominal corpus by inflation is equivalent to compounding at the real rate (1 + r)/(1 + π) − 1 on an annual basis.

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