Nominal vs Inflation-Adjusted Wealth Projection
This learning module is designed for serious investors who want to understand how money truly grows, how inflation destroys wealth, and how disciplined investing builds long-term financial freedom.
Money is dynamic. A rupee today is worth more than a rupee tomorrow because of inflation, risk, and opportunity cost.
Inflation quietly reduces your purchasing power every year. At 6% inflation:
SIP is a disciplined investing approach where you invest a fixed amount periodically, usually every month.
Each SIP installment compounds for a different duration. Earlier investments compound longer, later ones less.
Lumpsum investing means investing a large amount at once. It is sensitive to timing and valuation.
| SIP | Lumpsum |
|---|---|
| Lower timing risk | Higher timing risk |
| Best for salaried investors | Best for surplus funds |
| Emotionally easier | Emotionally challenging |
Goal-based investing starts with a clear target and works backwards.
A large number in the future does not guarantee purchasing power.
