Inflation is the quiet reason financial plans fail. Nothing dramatic happens; the number in your account never falls. What changes is what that number can buy.
The arithmetic
If prices rise at 6% a year, something costing ₹10,00,000 today costs roughly ₹17,90,000 in ten years and about ₹32,07,000 in twenty. Nothing about the goal changed. Only the price tag did.
Your inflation is not the headline inflation
Consumer price inflation is an average across a standard basket of goods. Your own basket is different. Education fees, medical treatment and property have historically risen faster than the headline number in India, which is why the education calculator on this site keeps education inflation as its own separate input.
What this means for where you keep money
Money held in a form that earns less than inflation loses purchasing power every year, even though the rupee balance never falls. That is not an argument for taking more risk than you can bear — it is an argument for matching the holding to the horizon. Money you need in eight months has no business being exposed to market movement. Money you need in eighteen years has a different problem entirely.
Building it into a plan
- State the goal in today's money first — it is the only figure you can estimate honestly.
- Apply an inflation assumption to get the future cost.
- Work backwards from that future cost to a monthly investment.
- Revisit the assumption every couple of years, because it will be wrong.