Inflation-Adjusted SIP Calculator

Created by Arunangshu DasReviewed Nov 10, 2026

Estimate what fixed monthly investments could buy at the end of a modeled horizon.

Compare the nominal ending value with its purchasing power and reconcile gains against deflated contributions.

Ending purchasing power

Enter a monthly plan or load the worked example.

Index 0 is the start of the first model month. Real gains compare values in opening purchasing power. Inflation is an assumption and does not change the nominal payment.

Understand what drives the projection

See how inflation and payment timing affect contributions and ending wealth.

Read the complete Inflation-Adjusted SIP guide

Formula and methodology

Opening purchasing power = terminal money ÷ terminal price factor.

For monthly investment factor f, monthly price factor p and n months, a payment C at index k grows to C × f^(n−k). Divide nominal ending value by p^n. Deflate each contribution by p^k and subtract that comparable contribution total to find real gain.

Definitions

An inflation-adjusted SIP compares a fixed nominal monthly investment plan with its value in opening purchasing power. Both rates are user-supplied effective annual assumptions.

Verified worked examples

Invest 500 at the end of each month for 12 months with 12% annual effective investment return and 6% annual effective inflation. Nominal ending value is 6,323.25. Dividing by 1.06 gives 5,965.33 in opening purchasing power. Contributions in opening purchasing power total 5,814.40, leaving real gain of 150.93.

Interpretation

Compare monetary values on the same price basis. The nominal sum of payments mixes amounts paid at different checkpoints. The effective annual real rate is (1 + investment return) ÷ (1 + inflation) − 1 using decimal rates.

Inputs and interpretation

Enter a fixed nominal monthly amount, complete months, both effective annual rates and beginning or end timing. Compare terminal money with opening purchasing power, then reconcile real ending value and real contributions.

Assumptions and limitations

The opening balance is zero. Beginning payments use indices 0 through n−1 and end payments use 1 through n. Each month is one twelfth of a model year. Fixed payments do not rise with inflation.

Supported domain and common mistakes

Use up to 10^12 per contribution and 0 through 1,200 months. Rates must be above −100% through 100%, with up to 12 decimal places. Calculations use 100 significant digits and reject monetary totals above 10^30.

Avoid comparing real ending value directly with a nominal sum of payments. Avoid subtracting inflation from return when you need exact compounding. Do not use an already inflation-adjusted return as the nominal input.

Frequently asked questions

How do I adjust a SIP for inflation?

Project the nominal ending value using the contribution schedule. Divide it by the price factor from opening to the end of the plan.

Do my contributions rise with inflation?

No. Every contribution is the same amount in nominal money. A later contribution can have a different value in opening purchasing power.

How do you calculate real gain?

Subtract the sum of contributions individually expressed in opening purchasing power from the ending value on that same basis.

What happens when investment return equals inflation?

The annual real rate is zero. Each payment keeps its purchasing power after it is invested, so modeled real gain is zero.

Can I enter deflation?

Yes. A negative inflation rate above −100% represents a falling price level. The terminal price factor remains positive.

How many payments occur at zero months?

None, even when beginning timing is selected. Both ending balances and contribution totals are zero.

Sources and educational scope

Educational constant-rate scenario with no CPI lookup, actual dates, fees, tax, inflation-indexed payments, FX or forecast. It does not provide personalized investment advice.

Reviewed 2026-11-10. AI-assisted content under operator editorial responsibility. No independent expert financial review is claimed.