Inflation Calculator
See what prices could be in the future, how much your money will really be worth, the average yearly rate between two prices, or what your savings earn after inflation. You choose the rate, so the result is always yours.
Your result
Enter your numbers above to see the result.
Results assume one steady yearly rate. Real inflation changes from year to year. This calculator is for general information and is not financial advice.
What inflation really means for you
Inflation is the slow rise in prices. A loaf of bread, a bus ticket, a month’s rent: over the years they tend to cost a bit more. When people say inflation is 3 percent, they mean that, on average, things cost about 3 percent more than they did a year ago.
The part that matters for your wallet is the mirror image. If prices go up, each coin or note buys a little less. Money you keep in a drawer still says the same number, but it can buy fewer groceries every year. That quiet shrinking is called the loss of buying power, or purchasing power.
This calculator helps you see that effect in numbers. You pick the yearly inflation rate and it shows what happens, so you can plan for a future cost, check what your savings are really worth, or work out how fast prices have been rising.
How to use this calculator
- Future price: enter a price today, a yearly inflation rate and a number of years. You get the price you could expect at the end, and a year-by-year list.
- Buying power: enter an amount of money, a rate and the years. You get what that money will be worth in today’s terms, and how much you would need then to buy the same things.
- Find the rate: enter an old price, a new price and how many years apart they are. You get the average yearly inflation between them.
- Real return: enter an amount, the interest you earn and the inflation rate. You get the real growth of your money after prices are taken into account.
There is no built-in inflation data on purpose. The answer depends on the rate you choose, so you stay in control. You can use your country’s official figure, the average over a past period, or a round planning number such as 2% or 3%. Try a few to see a range.
The formulas, in simple form
Future price = price today × (1 + inflation)years
Buying power today = amount ÷ (1 + inflation)years
Average yearly rate = (later price ÷ earlier price)1 ÷ years − 1
Real return = (1 + interest) ÷ (1 + inflation) − 1
Years to double = ln(2) ÷ ln(1 + inflation)
Inflation works like compound interest, only on prices. Each year the new price is the old price times (1 + rate), so the increases pile on top of each other. That is why a modest-sounding 3 percent becomes a big change over a few decades.
Four worked examples
A future price
Your weekly grocery shop costs 200 today. At 3% inflation, in 10 years it would cost 200 × 1.0310, which is about 268.78. That is roughly 34% more for exactly the same food.
Buying power
You keep 10,000 in cash for 20 years, with inflation at 3% a year. The number on the bank note does not change, but its buying power does: 10,000 ÷ 1.0320 is about 5,536.76 in today’s money. You would have lost about 44.6% of what it can buy.
Finding the rate
A loaf of bread cost 1.20 ten years ago and costs 1.80 now. Divide 1.80 by 1.20 to get 1.5. Raise it to the power of one tenth, which is 1.0414, then subtract 1. The average inflation for this loaf was about 4.14% a year.
A real return
Your savings earn 4% a year while prices rise 3% a year. It looks like you gain 1%, and the exact figure is (1.04 ÷ 1.03) − 1, or about 0.97%. Start with 10,000 and wait 10 years: the balance reaches 14,802.44, but in today’s money it is only worth about 11,014.41. The extra growth you can actually spend is much smaller than the headline number.
The Rule of 70: a quick mental shortcut
To estimate how long it takes for prices to double, divide 70 by the yearly inflation rate. At 2% that is about 35 years. At 5% it is about 14. The same number tells you how long it takes for money’s buying power to be cut in half. The table compares the shortcut with the exact answer.
| Yearly inflation | Rule of 70 | Exact |
|---|---|---|
| 1% | 70.0 years | 69.7 years |
| 2% | 35.0 years | 35.0 years |
| 3% | 23.3 years | 23.4 years |
| 4% | 17.5 years | 17.7 years |
| 5% | 14.0 years | 14.2 years |
| 6% | 11.7 years | 11.9 years |
| 8% | 8.8 years | 9.0 years |
| 10% | 7.0 years | 7.3 years |
What 1,000 buys later
This table shows what 1,000 of today’s money would be worth, in today’s buying power, if inflation stays at a steady rate.
| Inflation | After 10 years | After 20 years | After 30 years |
|---|---|---|---|
| 2% | 820 | 673 | 552 |
| 3% | 744 | 554 | 412 |
| 5% | 614 | 377 | 231 |
| 10% | 386 | 149 | 57 |
Your own inflation is not the headline number
The official inflation figure is an average over a basket of goods and services. Your own spending may look different. If you spend a lot on rent, fuel or food, and those prices rise faster than the average, your personal inflation is higher. If you spend more on things that get cheaper, like some electronics, it can be lower. If you want a closer match, use a rate that fits the things you actually buy.
Thinking about inflation in your plans
You cannot control inflation, but you can plan with it in mind. Some general ideas people consider: aim for savings or investments that earn more than inflation over the long term, so the real return is positive; keep an emergency fund in an easy-to-reach account but do not hold much more cash than you need; and when you plan for a big cost far away, such as education or retirement, estimate it in future money rather than today’s. The savings goal calculator can raise your target for inflation, and the compound interest calculator shows how returns build up. None of this is financial advice, and a qualified adviser can help with your own situation.
Common mistakes
- Treating the rate as a total. A 3% yearly rate over 10 years is about 34% in total, not 30%, because of compounding.
- Comparing nominal and real numbers. A bank balance of 14,802 and a buying power of 11,014 are different things.
- Subtracting inflation from your interest and calling it exact. It is a good approximation, but the exact method is a division, as the formulas above show.
- Assuming one steady rate in real life. Inflation changes, so test several rates.
- Forgetting taxes and fees, which also reduce what your money earns.
Frequently asked questions
What is inflation?
Inflation is the general rise in prices over time. When it is 3% a year, something that costs 100 today costs about 103 a year from now. The flip side is that each unit of money buys a little less, which is why people talk about the loss of buying power.
How do I calculate the future cost of something?
Multiply today's price by (1 + the yearly inflation rate) once for every year. For a price of 200 at 3% inflation over 10 years, that is 200 × 1.03 to the power of 10, which is about 268.78. The Future price tab does this for you and shows the price year by year.
How much will my money be worth in the future?
Divide the amount by (1 + the inflation rate) once for every year. At 3% a year, 10,000 kept for 20 years has the buying power of only about 5,537 in today's money. The nominal amount is still 10,000, but you can buy about 45% less with it. The Buying power tab shows this.
How do I find the inflation rate between two prices?
Divide the later price by the earlier one, raise the answer to the power of 1 divided by the number of years, and subtract 1. If bread went from 1.20 to 1.80 over 10 years, the average rate is (1.80 ÷ 1.20) to the power of 0.1, minus 1, which is about 4.14% a year. Use the Find the rate tab.
What is a real return?
A real return is what your money earned after taking inflation away. If your savings pay 4% and prices rise 3%, your buying power only grows by about 0.97% a year, because (1.04 ÷ 1.03) − 1 is about 0.0097. The Real return tab shows both the nominal and the real balance.
Which inflation rate should I use?
That is up to you, and it is the main thing that decides the answer. You can use the official inflation figure published by your country's statistics office, the average over a past period, or a planning figure such as 2% or 3%. This calculator does not include any built-in inflation data, so it never uses a number you did not choose.
Is inflation the same every year?
No. Real inflation goes up and down. The calculator assumes one steady average rate, which is a good way to see the long-term effect, but the real path will be bumpier. Try a few different rates to see a range.
What does the Rule of 70 mean?
Divide 70 by the yearly inflation rate to get a rough number of years for prices to double, or for the buying power of money to halve. At 3% that is about 23 years, and the exact figure is 23.4. The calculator shows the exact number.
Can inflation be negative?
Yes, a negative rate means prices are falling, which is called deflation. You can type a negative rate in the calculator, for example −1, and the results will show prices dropping and money gaining buying power.
Is anything I enter saved or sent anywhere?
No. The sums run in your browser and nothing you type is uploaded or stored on our servers. This calculator is for general information and is not financial advice.
Related calculators
To see growth with interest, use the compound interest calculator, and for steady investing the SIP calculator. To plan a target, try the savings goal calculator. For working out percentage changes between two numbers, the percentage calculator is handy.