Methodology — How We Calculate

Core formulas

• SIP / RD: future value of an annuity-due — FV = P × [((1+i)ⁿ − 1)/i] × (1+i), contributions at the start of each month, monthly compounding.
• Step-up SIP: the same annuity formula applied year by year, with the contribution rising by the step-up rate each year.
• Lumpsum / mutual fund / gold / property: compound growth — FV = P × (1+r)ᵗ. Property adds annual rent (price × yield) reinvested at the appreciation rate.
• FD: quarterly compounding — A = P × (1 + r/4)^(4t), matching standard bank practice.
• PPF: annual deposits at the start of the year, compounded annually at the notified rate.
• EMI: P × r × (1+r)ⁿ / ((1+r)ⁿ − 1) with a full monthly amortization schedule.
• SWP: monthly simulation — balance compounds, then the withdrawal is deducted.
• Retirement: corpus = present value of an inflation-growing annuity; required SIP derived from the annuity-due accumulation factor.
• CAGR: (End ÷ Begin)^(1/years) − 1.

Dashboard comparability convention

To compare unlike instruments fairly, the dashboard and compare mode give every instrument the same monthly outflow. Market and deposit products compound monthly; PPF, FD, gold and property treat each year’s outflow as a single annual purchase that then appreciates. This is a simplification — real property is not bought in annual slices — and it is disclosed wherever used.

Tax assumptions

• Equity (SIP, mutual fund, NPS equity): 12.5% LTCG on gains above the ₹1.25 lakh annual exemption; the tax toggle applies 12.5% to total gains as a conservative estimate.
• FD / RD interest: taxed at slab; the toggle uses 30% (highest common bracket) so you see the worst case.
• Property: 20% LTCG estimate; stamp duty and maintenance are discussed but not deducted from projections.
• PPF and NPS maturity lump sums: tax-free under current rules (EEE / 60% exemption).

Inflation adjustment

Real values divide the nominal value by (1 + inflation)ᵗ. The default inflation assumption is 6%, India’s long-run CPI average; the dashboard lets you change it.

Verification

Every calculator is validated against independent references (AMC SIP calculators, bank FD/EMI calculators, and spreadsheet recomputation) before release, and re-verified when formulas or tax rules change. Found a discrepancy? Tell us via the contact page — corrections ship within 5 working days.