How to calculate value of future goals and invest to achieve them?

Why Goal Based Investing?

We all understand the importance of having a goal and investing to achieve it. The two biggest advantages of goal-based investing, are – (i) Goals make it far more likely you’ll save for—and achieve— every one of your goals. When you can attach a real outcome to the purpose of your saving, you’re more likely to work toward that goal rather than blind saving, and (ii) it reduces human errors such as impulsive decision-making and overreaction.

Impact of Inflation

Generally, investors pick a random number, usually Rs. 50 lakhs or Rs. 1 crore. But, big figures may not be enough to take care of your future goals. You should know an important factor while planning for your financial goals. What seems a big number today may not remain big in the coming years. With the impact of annual inflation, the purchasing power of the same amount would corrode significantly with every passing year.

For example, take your child’s higher education. Let us assume that it costs Rs 5 lakh today. Next, find out how much time is left for your child to get an admission to the course. Or, in other words, when will you need the money for your child’s education. Let’s assume again that he would go to college in 15 years. Now you need to determine how much this education (which costs Rs. 5 lakhs today) is going to cost after 15 years. That means you need to find out how much will the education cost get inflated in 15 years. This is called calculating the future value of your goal.

Future Value (FV)= Present Value (PV) * (1+r) ^ n


FV= Future value of your goal

PV= Present value or current cost of your goal

r= annual rate of inflation (in %)

n= time left to reach your goals (in years)

Putting the values of the above example in formula, assuming education inflation is 9 per cent, the same education course will cost Rs. 18,21,240 after 15 years.

Numerically challenged? Don’t worry. Upwardly’s goal-based investment methodology allows you not only to plan what your future requirements could be but also how much you need to invest today to achieve that.

For example, when you set up a goal to buy a home on Upwardly that costs Rs.1 Crore today, 7 years later. Also assume you want to save for a down payment of 40%.


We not only estimate the future cost of this home based on inflation data for real-estate but also suggest the amount you need to invest as down-payment. We estimate this based on your income and annual increments that you could get. We take all the guesswork out of your planning to ensure that you are more likely to achieve your goal.


We all have dreams and desires, but we do not plan our investments according to our goals. Most people just invest in an unplanned manner. Goal based investing adds direction to an investment. It helps you remain focused and unaffected by the short-term market volatility. And the further in advance you start saving for a goal, the less you’ll have to save. Why? The power of compounding. The earlier you start saving, the more time you give the market to grow your savings for you.

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