How Forecast Projection Works?

 What if you could see how your net worth might grow in the coming years, based on the assets you already own today?

This isn’t guesswork. It’s a data-driven, research-backed projection that uses trusted market indices, historical performance, and your current portfolio to estimate what your wealth may look like in the future.

Why Forecast Your Net Worth?

Most of us track our finances by looking backwards — “How much did my net worth change this month?” But real progress happens when you look forward.

With forecast, you’ll now see:

• Projected net worth 3 years from today
• Projected value of each asset class — Stocks, Mutual Funds, Real Estate, Gold, FDs, etc.
• A forecast range (conservative to aggressive) for a realistic planning

We calculate this using a bottom-up model — meaning each asset and liability is projected individually and then combined to form your future net worth.

How We Calculate Forecast?

For most assets, we use historical growth trends to estimate how the value could grow in future. 

We then provide a range

• Conservative projection uses a slightly lower growth rate  
• Aggressive projection uses a slightly higher growth rate

This adjustment is small usually in the range of (0.5% – 2%) depending on the asset class.

Some assets don’t appreciate (e.g., vehicles). For these, we use a depreciation model instead.

For liabilities, we show the current outstanding amount as the forecast, since it is dependent on your repayment behaviour. 

Asset-by-Asset Forecast Guide

• Mutual Funds

We use the MF’s category/sub-category average CAGR (Flexi Cap fund, Value fund, Large Cap fund, etc.).

Example – 

• You hold ABC Flexi Cap Fund worth ₹1,00,000.
• Since it belongs to the Flexi Cap category, we use the average CAGR of all Flexi Cap funds to project its value, which is 17.08%
  

Hence, 3 year forecast = ₹1,00,000 × (1.1708)³ = ₹1,60,490

Aggressive and conservative values are computed by adding and subtracting 2% from the CAGR.

• Stocks & ETFs

Each Stock/ETF is mapped to a benchmark index, depending on its category. This ensures that the forecast uses a realistic, market aligned growth rate.

Examples of benchmark mapping:

• Large Cap → Nifty 100
• Mid Cap → Nifty Midcap 100
• Small Cap → Nifty Smallcap 100
• MultiCap ETF → Nifty 500
• Gold → Goldbees ETF
• Silver → Silverbees/MCX
• Debt → CRISIL indices

We then use the benchmark’s CAGR for forecast.

Example

• You hold a Midcap ETF worth ₹50,000.
• Benchmark CAGR for Midcap category is 14.27%.

Then, 3 year forecast = ₹50,000 × (1.1427)³ = ₹74,604 

Aggressive and conservative values are computed by adding or subtracting a small percentage depending on the benchmark

• smallcases

Stock smallcase

We map each stock/ETF to its benchmark index and use the benchmark’s CAGR. Then, based on each constituent’s weight, we calculate the weighted average CAGR. This weighted CAGR is applied to the smallcase value to project its value 3 years into the future.

Example – 

If you have invested ₹1,00,000 in a smallcase that contains the following constituents:

Hence, the weighted average expected CAGR would be = 14.58%
Then, 3 year forecast = ₹1,00,000 × (1.1458)³ = ₹1,50,427

Similarly, we can calculate the aggressive and conservative CAGR and range.

Mutual Fund smallcase 

We map each Mutual Fund to it’s category (Flexi Cap, Large Cap, Mid Cap, etc.) and use the category’s historical CAGR. Then, based on each constituent’s weight, we calculate the weighted average CAGR. This weighted CAGR is applied to the smallcase value to project its value 3 years into the future.

Example – 

If you have invested ₹1,00,000 in a smallcase that contains the following constituents:

Hence, the weighted average expected CAGR would be = 15.57%
Then, 3 year forecast = ₹1,00,000 × (1.1557)³ = ₹1,54,360

Similarly, we can calculate the aggressive and conservative CAGR and range.

• Fixed Deposits

For fixed deposits, we calculate the forecasted value using the details you provide (investment amount, interest rate, maturity date). Interest is compounded quarterly, and month-end values are computed until the maturity date.

Once the FD matures, we use the RBI’s Savings Deposit Rate as a benchmark to project future value. 

Example

• Suppose your FD is currently worth ₹2,10,000, with 2 years remaining until maturity at an 8% annual interest rate
• Using quarterly compounding, the forecasted value at maturity would be:
  2,10,000 × (1 + 0.08/4)⁴ˣ² = ₹2,46,048
• After maturity, projecting 1 more year using the RBI Savings Deposit Rate (2.5%):
  ₹2,46,048 × (1.025)¹ = ₹2,52,199

• Bank Accounts 

We use RBI’s Savings Deposit Rate as the benchmark for forecasting bank balances.

Example

• If you have a ₹50,000 balance and RBI’s Savings Deposit Rate is 2.5%:
• Then the 3Y forecast = ₹50,000 × (1.025)³ = ₹53,844

• Real Estate 

We use the Housing Price Index (HPI) as a benchmark to forecast your real estate value. HPI tracks how residential property prices have changed across Indian cities, providing a reliable indicator of home price growth over time.

If your property is in one of the cities covered by HPI, we use the city-level HPI to calculate the expected growth. For properties outside these cities, we use the overall HPI for India.

Aggressive and conservative values are computed by adding and subtracting 2% from the CAGR.

Example

• If your real estate value is ₹50,00,000 and the city’s CAGR according to HPI is 5%
• Then, 3 year forecast = ₹50,00,000 × (1.05)³ = ₹57,88,125
• Conservative and aggressive forecast range = (50L × (1.03)³, 50L × (1.07)³) = (₹54.6L, ₹61.2L)

• Gold

We use the Goldbees ETF CAGR as a benchmark to project the growth of your gold assets.
Aggressive and conservative values are estimated by adding or subtracting 2% from the CAGR.

Example

• Suppose your gold holdings are worth ₹3,00,000, and the Goldbees ETF CAGR is 13%
• The 3-year forecasted value would be = ₹3,00,000 × (1.13)³ = ₹4,32,869

• EPF

We use the current EPF interest rate to forecast the growth of your EPF balance. 

Example

• Suppose your EPF balance is ₹5,00,000, and the current EPF interest is 8.25%
• The 3-year forecasted value would be = ₹5,00,000 × (1.0825)³ = ₹6,34,240

• Other Assets 

For assets where we don’t have a specific benchmark (like miscellaneous investments), we use the RBI Repo Rate to estimate growth.

• Vehicles 

We estimate your vehicle’s value using an annual depreciation of 15%. Each year, the value decreases by 15% of the previous year’s value. To avoid unrealistic depreciation, we cap the minimum value at 10% of the original purchase price.

Example

• If you bought a car for ₹15,00,000
• End of Year 1: ₹15,00,000 × 0.85 = ₹12,75,000
• End of Year 2: ₹12,75,000 × 0.85 = ₹10,83,750
  
  Minimum value (after many years) = ₹1,50,000

DISCLAIMERS

The views, illustrations, and future projections discussed in this post are for educational and informational purposes only and should not be viewed as a representation of guaranteed or assured returns. The content of this post including securities/investment products mentioned if any, should not in any manner be construed as an investment advice, recommendation, offer, solicitation to buy/hold/sell any securities/investment products. The securities quoted if any, are for illustration purposes only and are not recommendatory. Investment in securities market are subject to market risks. Read all the related documents carefully before investing. Please consult our financial advisor before making any financial decisions (including investments). The company makes no warranties regarding the accuracy or suitability of any projections and disclaims all liability arising from reliance on such illustrative data.