Wealth Projection Calculator

What is Wealth Projection?

A wealth projection estimates how your investable net worth may grow over time when your income, savings rate, and investment returns work together. It is useful when you want to answer practical questions such as: "If I save 30% of my income every month, where could I be in 10, 15, or 25 years?"

Unlike a basic compound interest calculator, this tool connects your wealth plan to your career path. It considers your current income, expected annual salary growth, monthly savings rate, existing investments, expected portfolio return, and investment horizon. The result is an estimate, but it gives you a structured way to test whether your current saving and investing habits are strong enough for your long-term goals.

For Indian investors, this is especially useful for planning retirement, financial independence, a future home purchase, children's education, or simply building a long-term mutual fund and equity portfolio with disciplined monthly contributions.

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How to Use the Wealth Projection Calculator

Simulate your future net worth trajectory in a few steps:

1. Enter your current income: Use annual salary or annual household income before savings and investments.
2. Add expected salary growth: A realistic range may be 5% to 10% for many salaried professionals, depending on industry, role, and career stage.
3. Set your savings rate: This is the percentage of income you can invest after rent, EMIs, living expenses, insurance, and taxes.
4. Enter existing investments: Include mutual funds, stocks, EPF, NPS, fixed income, and other investable assets. Avoid counting self-occupied home value unless you plan to sell it.
5. Choose expected return and duration: Use conservative return assumptions. Equity-heavy portfolios can fluctuate sharply in the short term even if long-term expectations are higher.
6. Compare the output: Review projected salary, annual investments, total contributions, compounded wealth, and the extra value created by investing instead of keeping cash idle.

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The Mathematics of the Simulation

The calculator uses a month-by-month compounding model. That matters because most people invest through monthly SIPs rather than one large annual contribution.

1. Annual Salary and SIP Escalation

Your salary is assumed to grow by an annual increment percentage, shown here as s. At each year y, annual salary is estimated as:

Salary(y) = Salary(y - 1) x (1 + s / 100)

Your monthly investment is then estimated from salary and savings rate:

Monthly Investment(y) = [Salary(y) / 12] x [Savings Rate / 100]

Because your salary increases annually, your monthly systematic contributions automatically step up each year, creating a powerful step-up compound effect.

2. Portfolio Compounding Loop

At each month, the calculator grows your existing portfolio by the monthly equivalent of your expected annual return and adds the monthly investment. If the annual expected return is R, the monthly rate is:

r = R / 12 / 100

The future value of one year's monthly investments is estimated as:

Future Value of Monthly Investments = Monthly Investment x [((1 + r)^12 - 1) / r] x (1 + r)

The final projection is built by repeating this process for every year in your selected time horizon.

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Simple Savings vs. Compounded Wealth Projections

The table below compares simple savings with invested wealth for a professional earning ₹12,00,000 per year, saving 30% of income, increasing income by 8% annually, and earning an assumed 12% annual return. The starting monthly investment is ₹30,000.

Year Horizon	Projected Monthly Salary	Annual Systematic SIP	Cumulative Simple Savings	Invested Compounded Wealth (12% CAGR)	Net Compound Premium Earned
Year 0 (Start)	₹1,00,000	₹3,60,000	₹0	₹0	₹0
Year 5	₹1,46,932	₹5,28,950	₹22,08,900	₹29,45,000	₹7,36,100
Year 10	₹2,15,892	₹7,77,210	₹54,53,000	₹92,45,000	₹37,92,000
Year 15	₹3,17,216	₹11,41,980	₹1,02,15,000	₹2,35,56,000	₹1,33,41,000
Year 20	₹4,66,095	₹16,77,940	₹1,72,12,000	₹5,28,45,000	₹3,56,33,000
Year 25 (Exit)	₹6,84,847	₹24,65,450	₹2,74,89,000	₹11,12,45,000	₹8,37,56,000

This example is intentionally simple. Real portfolios do not earn the same return every year. Markets can remain flat or negative for long periods, and taxes, fund expenses, asset allocation, and investor behavior can all change the final outcome. Use the result as a planning range, then test lower-return scenarios before making major life decisions.

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How to Improve Your Wealth Projection

Small changes in savings rate, return assumption, and time horizon can create large differences over 15 to 25 years. Focus on the levers you can control.

• Increase savings gradually: When your salary rises, try to invest part of the increment before increasing lifestyle spending.
• Keep an emergency fund: Maintain enough liquid money for job loss, medical costs, family needs, or urgent travel so you do not have to redeem long-term investments at the wrong time.
• Use realistic return assumptions: A 12% return may be reasonable for long equity-heavy projections, but it is not suitable for a conservative debt-heavy portfolio.
• Separate goals by timeline: Money needed within 3 years should not be projected like long-term equity wealth.
• Review net worth annually: Track assets, liabilities, investments, EPF/NPS balances, loans, and insurance needs once a year.
• Reduce high-interest debt first: Credit card debt and expensive personal loans can destroy wealth faster than investments can build it.

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Frequently Asked Questions

What is the difference between Simple Savings and Compounded Wealth?

Simple savings is the total amount you set aside without assuming any investment return. Compounded wealth is the projected value after those savings are invested and returns are reinvested over time.

How does annual salary growth affect my wealth projection?

Annual salary growth increases your ability to invest. If you raise your SIP or monthly investments whenever income rises, your portfolio can grow much faster than it would with a flat contribution. The actual difference depends on your savings rate, investment return, and number of years invested.

What is the "Compound Premium"?

The compound premium is the difference between your total invested amount and the projected compounded value. It shows how much of the final wealth comes from investment growth rather than fresh contributions.

How often should I re-evaluate my wealth projection?

Review your projection at least once a year, and also after major changes such as a new job, salary increase, home loan, marriage, childbirth, inheritance, or a shift in investment strategy.

Should I include my house in wealth projection?

Include property only if it is part of your financial plan and you may sell, rent, or borrow against it. For retirement or financial independence planning, it is usually better to separate self-occupied home value from liquid investments.